Friday, March 25, 2016

Bangladesh Bank loses money

In a swift (unintended pun) operation, the central bank of Bangladesh, the Bangladesh Bank, has lost $61 million since its SWIFT terminal was reportedly kept logged on after office hours in February. Its system was hacked with ease apparently by some Chinese criminals and instructions were issued to NY Fed where many central banks maintain accounts to transfer about $ 1 billion to various payees. Surprisingly, only $101 million was transferred mainly to Philippines and Sri Lanka. Bankers in Sri Lanka became suspicious about these transfers and sought verification from NY Fed. NY Fed got alerted and further damage was prevented.

$60 Million transferred to Philippines disappeared into a black hole in the form of a casino. It is strange that casinos do not attract KYC norms in that country. So the identity of ultimate recipients will be mysterious for ever. Operational laxity in Bangladesh Bank and NY Fed and criminal complicity in Philippines are astounding. Combination of money and negligence never fails to attract fraudsters.

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