‘Disquieting development’: CPD says money laundered to US is returning as remittances

Bangladeshis in the United States remitted $3.05 billion in the July-April period, compared to $3.04 billion from Saudi Arabia in the same period, according to central bank data

Part of remittances streaming into Bangladesh from the United States is “recycled money” previously laundered out of the country, the Centre for Policy Dialogue has said.

Bangladeshis in the United States remitted $3.05 billion in the July-April period, compared to $3.04 billion from Saudi Arabia, traditionally the biggest source of remittances, in the same period, according to central bank data.

In a media briefing on Saturday, Fahmida Khatun, executive director of the think-tank, said: “Money laundered to the US is returning to the country as remittances.”

Remitters are taking advantage of 2.5 percent cash incentives and a better exchange rate on remittances.

The government had offered a flat 7 percent tax rate to Bangladeshis to encourage them to return laundered money to the country, but the policy was met with no response.

Fahmida suggested the authorities figure out where the remittances were arriving from.

The overall slow growth of remittance inflows and a relative decline in remittances from some countries in the Middle East merit careful investigation, the CPD said in a report.

The overall slow growth of remittance inflows and a relative decline in remittances from some countries in the Middle East merit careful investigation, the CPD said in a report.

The likelihood of transfer through hundi or hawala and repatriation of money to take advantage of the incentives provided for inward remittances and the scope of whitening of black money taken out of the country illegally should come under scrutiny by the authorities, the CPD said.

The think tank called for appropriate steps to deal with the emergent trend.

The likelihood of transfer through hundi or hawala and repatriation of money to take advantage of the incentives provided for inward remittances and the scope of whitening of black money taken out of the country illegally should come under scrutiny by the authorities, the CPD said.

The think tank called for appropriate steps to deal with the emergent trend.

One “disquieting development” in recent times relates to remittance inflows: remittances have risen by only 2.4 percent in the July-April period year-on-year, the CPD said.

The remittance in April this year was 16.3 percent lower than what it was last year, despite Eid-ul-Fitr being held last month, it added.

The CPD pointed out that the number of people going abroad for work in the first 10 months of the current fiscal year was ‘significantly high’ at 922,000 people.

“The majority of these people went to the Gulf countries, but the remittance flows from this region did not match this rising number.”

Remittances from Oman slipped to $628.8 million in the July-April period from $849.9 million a year earlier, while funds from Kuwait declined 4.5 percent to $1.32 billion.