BB issues policy to check money laundering in exports

Staff Correspondent

14 July, 2021 12:00 AM printer

Bangladesh Bank has issued new guidelines to protect exporters and prevent money laundering.

Under the new guidelines, there will be efforts in maintaining core risk management and cross border correspondent banking relationship.

The Foreign Exchange Policy Department of the central bank on Tuesday issued the guidelines sent to all the authorized dealer banks.

Bangladesh Bank issued the directives as Foreign Exchange Risk Management Guidelines to mitigate risks in exports.

It also delivered a policy on prevention of trade-based money laundering.

It said the Authorized Dealers (ADs) will have to ensure safeguards in export trade and establish relations with foreign shell banks as well as the banks of exporting and importing countries.

The directives stated that the ADs must ensure the validity of the applicant bank and the issuing bank in obtaining the loan through a third bank at the time of export under the LC loan.

The export documents have to be sent directly to the applicant bank and the issuing bank or through a bank that has a relationship with both banks.

In case of transferred LCs, ADs shall satisfy regarding the bonafide of first beneficiary and transferring bank in addition to the LC applicant banks or issuing banks.

The ADs will conduct due diligence on importers’ banks designated for the transactions under sales contracts for being ensured of their step by step responsibilities.

The responsivities are related to the release of export documents by designated banks to importers and procedural arrangement of payment as per the Guidelines for Foreign Exchange Transactions-2018.

It also includes the central bank’s subsequent circulars and relevant provisions of the Uniform Rules for Collection (URC) in force.

In this case, the ADs need to be ensured that the importer’s banks will receive export documents directly from them or through third banks or other authenticated banks with whom respective ADs maintain appropriate relationship.

The BB instruction also said the ADs have to take necessary measures to ensure fairness of contract between the importer's banks in conducting exports.