The first incident of bank embezzlement in the country occurred at the former Oriental Bank (now ICB Islami Bank) which opened fake accounts and single and joint capital companies at the then Oriental Bank (now ICB Islami Bank) between June 19, 2006, and 2003. Obaidul Karim, the owner of Orion Group, played the role of the main miscreant in this scam. His son Salman Karim, his son-in-law Mehdi Hasan, and his brothers Ebadul and Rezaul Karim were all involved in this swindle. The other four were the bank's directors, excluding Obaidul Karim. They embezzle the customer's money kept in the bank by withdrawing it from different branches using all the tricks. However, the embezzlement did not remain a secret for long. Based on the complaint, it was revealed in Bangladesh Bank's investigation. The incident of embezzlement of the bank's money was made in the legal process at one point. Although Obaidul Karim and his associates were sentenced to imprisonment in three separate cases, none of them served that sentence in the last 16 years. It is unprecedented but true that even though legal proceedings were completed in the first instance of bank embezzlement in the country, they were not implemented.
At that time, Salehuddin Ahmed, the finance advisor of the current interim government, was the governor of Bangladesh Bank. Governor Dr. Salehuddin Ahmed did not accept the unfair proposal from the top level of the government to save Obaidul Karim and withdraw money from the capital market by releasing the bonds of the bank, which was on the verge of financial ruin. As a matter of statutory duty, he stuck to his decision and seized the shares of Obaidul Karim and his fellow directors to save the interest of the depositors. Later, under the supervision of Bangladesh Bank, when the initiative was taken to sell the bank by auction, Malaysia's ICB Islami Bank Group bought Oriental Bank as the highest bidder and started operations under the name of ICB Islami Bank. However, while some customers got their deposit back, many did not. The bank, which started with a new name, has not been able to come out of that distressed situation.
The owner of Orion Group, Obaidul Karim, along with his family's "quintet," threatened and intimidated the officials and embezzled the majority of Tk 2 thousand 329 crores of customers' accumulated deposits from the renowned and financially prosperous Oriental Bank (formerly Al-Baraka Bank). The deposits of customers were withdrawn by using Inter Branch Debit Advice (IBDA) and Inter Branch Credit Advice (IBCA) and opening fake savings, investment accounts, and importing credit cards from different branches of the bank. Out of this, Tk 488 crore and 50 lakh were embezzled from the bank's head office, principal branch, Bangshal, Karwan Bazar, Nawabpur, and Mirpur Road branches in the name of loans against anonymous and fake commercial establishments. Apart from this, 191 crores, 70 lakh, 692 IBCA, or credit entries against 469 IBDAs or debit entries as investments in the name of related organizations of that family cycle are found to be uncoordinated. The amount of money embezzled by Obaidul Karim and his associates is about Tk 757 crore. Obaidul Karim used 54 fictitious companies and 10 anonymous bank accounts to embezzle the money. In addition, he removed US$1 lakh and 80 thousand by showing fake information about imports. At that time, Bangladesh Bank conducted a special investigation into 30 branches of the bank.
At that time, Bangladesh Bank Governor (advisor of the current interim government) Dr. Salehuddin Ahmed ordered a special investigation into the Oriental Bank based on various complaints in the bank. The inquiry, which was submitted to the Governor on June 19, 2006, recommended that Obaidul Karim and his associates, interested parties, and bank officials be held responsible for the embezzlement of customers' money under criminal and civil laws. Seeing the dire situation, Obaidul Karim filed a complaint against Bangladesh Bank at the top level of the then-government. At that time, Prime Minister Begum Khaleda Zia called Governor Dr. Salehuddin Ahmed. But he (the Governor) managed to convince the Prime Minister by explaining the correctness of his adamant stand, and the findings of the inquiry later led to legal proceedings. After a few months, the government changed and the caretaker government took over, and the then Senior Assistant Vice President (SAVP) and Head of the Human Resource Department of Oriental Bank Kazi Manjur Hossain filed a case against 25 people on January 25, 2007, at Tejgaon Police Station. Obaidul Karim did not have to serve any sentence despite being sentenced to 48 years in two separate cases of money embezzlement, money laundering, and acquiring wealth through illegal means. He has spent 16 years with the strategy of delaying the hearing and missing the case documents from the court in the meantime. There are a total of 14 cases against him, including three for conviction. The trial of these cases filed in 2007 is now at a standstill. However, after the fall of the government on August 5, the Anti-Corruption Commission (ACC) took the initiative to handle all those cases again after the interim government took over. The investigation officer for the case is the deputy director of the ACC, Md. Jahangir Alam. An official also said that the acquittal of all the accused in the former Oriental Bank embezzlement case will also be reviewed.
Meanwhile, experienced and renowned banker CM Koyes Sami served as the managing director (MD) of the bank during the period 2003–2006. He is the brother of CM Shafi Sami, advisor to the caretaker government in 1991. Kais Sami is currently the president of the Jalalabad Association in Dhaka. He has also been held responsible for embezzling the bank's money in the investigation report for Bangladesh Bank. When contacted by Khaborer Kagoj on Wednesday, he shared his experience of duty at that time.
"There were incidents of looting of money in branches. When the news from the branch level came to me, I spoke to the concerned director and officers in charge of the branch and requested that they refrain from such activities. But by that time, some of the officials had been complicit in embezzling money, and others had been forced to transfer the money to the bank irregularly due to threats and intimidation," Koyes Sami stated.
"At one stage, I contacted Bangladesh Bank and asked for intervention. The then governor, who is now a finance adviser, knows the matter," he added.
"I had to report to a special agency after 'one-eleven'. I said frankly that I must be responsible for the misappropriation of the customer's money deposited in the bank. But I did not take any interest in or benefit from it. If that special agency finds something like that, they can take action against me. But they did not find any evidence against me, and consequently, I was acquitted," he said.
When the Khaborer Kagoj asked him why he did not resign after some directors of the bank took away so much money for three years, Koyes Sami said, "Before I joined Oriental Bank, I was the MD of several banks, and that's why a section of experienced bankers were also in the same bank with me. We could not all leave the bank together. We collectively tried to turn around in the end. But I failed."
In an interview given to a national newspaper on August 6, 2023, Dr. Salehuddin Ahmed said that the owner of the bank left with all the money. However, then chairman of the bank was not aware of this. Keeping the board in the dark, the owners took out the money with the help of some bankers.
History of the Oriental Bank
The financial institution in the name of Al Baraka Bank, which started in 1987, turned into a 'troubled bank' in 1994. Bangladesh Bank then appointed observers to keep the bank afloat. As there was no improvement, Obaidul Karim, the owner of Orion Group, and Abul Khair Litu, the founder of Bengal Group, bought the majority of the shares of the bank and started its commercial activities under the new name of ``Oriental Bank'' in 2004.
Bangladesh Bank's investigation revealed in 2006 that Obaidul Karim and Abul Khair Litu held 86.34 percent of the bank's shares in violation of Section 14A(1) of the Bank Companies Act, 1991. Of this, Obaidul Karim's family and four companies owned by them hold 69.87 percent. In addition, four foreign institutions were collectively holding some shares, which were later confiscated by the central bank. Among them, the share of Founder International Investment Limited was 8.67 percent, or 45 thousand.
The central bank dissolved the board of directors of Oriental Bank after a central bank investigation found embezzlement through massive irregularities in June 2006. Masum Ahmed Chowdhury was the chairman of the bank. The management authority of the bank and the ACC filed a total of 34 cases against Oriental Bank for embezzlement of approximately Tk 34 crore in 2006 and 2007.
