Banking Sector: Petition seeks formation of commission to look into graft

A rights organisation yesterday filed an appeal with the Supreme Court seeking its directive on the government to form a commission to look into the irregularities and corruption in the banking sector in the last two decades.

Human Rights and Peace for Bangladesh (HRPB) submitted the the leave to appeal petition to the office concerned of the Appellate Division of the SC praying to the apex court to stay a part of the High Court directive that ordered the Bangladesh Bank to constitute a nine-member committee to find out the loopholes in sanctioning, distributing and recovering the loans.

HRPB lawyer and its president Manzill Murshid, who submitted the leave to appeal petition, told The Daily Star that his organisation had filed a petition as a public interest litigation with the HC in February last year seeking its directive on the government to form a commission.

But, the HC did not pass any such directive. The  HC ordered the Bangladeh Bank to constitute a nine-member committee to find out the loopholes in sanctioning, distributing and recovering the loans, and to make necessary recommendations and suggestions to this effect, he said.

Advocate Murshid said ,"We have become aggrieved with the High Court directive as it did not direct the government to form a commission to look into the irregularities... That is why, we have filed the petition, seeking necessary directives to this effect."  

The lawyer said he will place the petition before the chamber judge for its hearing soon.

Following the petition, the HC on November 3 last year ruled that loan defaulters must make down payment of 15 percent of the outstanding amount to get fresh loans from any scheduled bank in line with the 2012 Bangladesh Bank circular.

 The court, however, said the BB circular issued on May 16 last year will be valid for the next 90 days so that the borrowers can apply for rescheduling their bank loans.

The central bank issued the circular allowing borrowers, who became defaulters by December last year, to reschedule loans for 10 years by making a down payment of only 2 percent instead of the existing 10 percent.

The HC also ordered BB to constitute the nine-member committee. The central bank has also been ordered to follow the recommendations and suggestions of the committee.

The HC ruled that in future, any commercial bank has to appoint its top five officials, including the managing director, under the supervision of BB.