Directors ‘swindle’ money

Publication Date: 21 June 2016
Media: The Independent

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Seven people on the board of directors of state-owned Modern Karilin Silk Mills of Chittagong illegally sold its 2.89 acres of land to Bangladesh Steel Re-rolling Mills (BSRM) in exchange of Tk17.34 crore. The Independent found from the bank statement of Modern Karilin Silk Mills that all the money was transferred to the personal accounts of these seven people, who later withdrew the money from their respective accounts without showing any business transaction.

sprawling on 2.69 acres of land alongside the Dhaka-Chittagong highway in Faujdarhat Industrial Area, the mill was illegally sold to BSRM in November 2010 in exchange for a meager amount of money, which the industry insiders say should have crossed 100 crore.

Flouting the conditions of contracts between the government and the workers and employees of Karilin Silk Mills, one of its workers’ leaders sold a large piece of the mill’s land illegally to BSRM– one of the leading steelmakers in Bangladesh– through forgery.

Although the mill changed hands, as per the gazette notification of the Ministry of Textiles and Jute and condition of the handover deed between the government and the workers and employees, there is no provision to sell or buy the mill.

To achieve this fraud, Mohammad Ishaque, the chairman of the Karilin Silk Mills and one among the guilty seven, had appointed three established industrialists and businessmen—SM Murshed Ali and his two brothers Showkat Ali and Hashem Ali—as officials of Modern Karilin Silk Mills in 2009. They were appointed as managing director and other directors of the factory. Mohammad Ishaque also empowered them to operate the mill’s bank account. It was found that BSRM deposited three cheques for Tk. 16.84 crore at the Halishahar branch of NCC Bank Limited (a/c no. 0030-021008396). From this account, SM Murshed Ali transferred Tk 10.99 crore to his personal account and his personal company Ali Steel’s account, while his three brothers Showkat Ali, Hashem Ali, Jamshed Ali, another director, and one Shamsed Ali transferred Tk 3.70 crore, Tk 0.10 crore, Tk 0.30 crore and Tk 0.30 crore, respectively, to their own accounts. Mohammad Ishaque transferred Tk 0.95 crore and Mohammad Jafar, also a director, Tk 0.50 crore to their own accounts. Sources said the remaining Tk 0.50 crore was also withdrawn by Mohammad Ishaque himself, but it has not been found how and from where he had withdrawn the money.

After transferring the money to their own accounts, the directors then divided it up among themselves.

A cheque (no.13207443) for Tk 4.50 crore was deposited by BSRM at Modern Karilin Silk Mill’s account at NCC Bank’s Halishahar Branch on September 29, 2010. The money was added to the account on September 30. On the same day, Tk 2.17 crore was transferred to Ali Steel’s account (no. 0030-0181010073) at the branch.

On September 30, 2010, Tk. 1 crore transferred from the same account as Security Deposit Receipt (SDR) to Showkat Ali’s personal account at the Phartali branch of AB Bank. On the same day, Tk 70 crore was transferred as SDR to accounts of three people—Hashem Ali’s account (Tk 10 lakh), Shamsed Ali’s account (Tk 30 lakh) and Jamshed Ali’s account (Tk 30 lakh)—at the same branch.

On that day, Tk 55 lakh was transferred as SDR to Mohammad Ishaque’s account and Tk 30 lakh to Mohammad Jafar’s account, while the rest Tk 8 lakh was withdrawn in cash by the duo.
On November 21, BSRM sent another cheque for Tk 10.34 crore, and the money was added to the account on November 22. On the same day, all the money had been transferred to Ali Steel’s account.

From Ali Steel’s account, Tk 2.70 crore had been transferred to Showkat Ali’s account and Tk 70 lakh to Alvi Enterprise (account no: 0030-0210009297), a personal company of Mohammad Ishaque.

On November 23, Tk 30 lakh was transferred to Mohammad Jafar’s account from Alvi Enterprise’s account.

On December 29, a cheque for Tk 2 crore was deposited by BSRM in the mill’s account at NCC Bank’s Halishahar branch. Next day, the money was added to the account, but Tk 1 crore out of it was immediately transferred to Ali Steel’s account and a pay order was issued to the chairman of the Chittagong Development Board, SM Murshed Ali.

When SM Murshed Ali was asked why the money was transferred to his account, he said Mohammad Ishaque had taken a loan of Tk. 10.34 crore for Karilin Silk Mills. Following the decision of the mill’s directors at a board meeting, the money was transferred to Ali Steel’s account, he added.

SM Murshad Ali’s brothers Showkat Ali, Hashem Ali, and Jamshed Ali also echoed his words. They said Mohammad Ishaque had given them a consent letter regarding payment of the loan.
Mohammad Ishaque, however, alleged that Tk.16.84 crore was swindled out by the other directors. He also lodged a complaint regarding it with the textiles and jute ministry.

Following his complaint, an investigation report submitted by a committee on April 12 last year suggested that Mohammad Ishaque was responsible for the misappropriation. He used SM Murshed Ali and his brothers to carry out this fraud, the report said.

The committee comprised Md Abdur Razzak, director of the Bangladesh Textile Mills Corporation (BTMC), Md Abul Hossain, additional deputy commissioner of Chittagong, Md Sarwar Hossain, joint director of Bangladesh Bank and Saifuddin Ahmed Mazumder, deputy secretary of the jute and textile ministry. The report also said Mohmmad Ishaque swindled Tk 11.99 crore, as he had taken the money from SM Murshed Ali. Md Showkat Ali swindled Tk 3.70 crore, while Hashem Ali, Jamshed Ali, Shamsed Ali, Murshed Ali and Mohammad Jafar respectively swindled the amounts Tk 10 lakh, Tk 30 lakh, Tk 30 lakh, Tk 65 lakh and Tk 50 lakh. The report also accused Md Didarul Alam, manager of NCC bank’s Halishahar branch, of being involved with the fraud as he had allowed the transactions. Didarul Alam could not be contacted as he has retired from the bank.

Current bank manager Krishloy Sen declined to comment on the topic. Advocate Sukumer Talukder, lawyer of Mohammad Ishaque, told The Independent, “BSRM has set up others in its own interest and transferred the money to their accounts. My client didn’t swindle any money.”