The Chittagong Port Authority has asked its branches and sub-branches to stop accepting pay orders, cheques and bank guarantees from nine troubled banks, seven of which were linked with S Alam Group.
The authority issued a notification regarding this on August 29.
The nine banks are Islami Bank Bangladesh, Global Islami Bank, Union Bank, Bangladesh Commerce Bank, First Security Islami Bank, Social Islami Bank and National Bank 鈥� all linked to the S Alam Group.
Additionally, Padma Bank and ICB Islami Bank face similar restrictions.
Recently, the Bangladesh Bank dissolved the boards of four banks controlled by S Alam Group, except for First Security Islami Bank PLC and Bangladesh Commerce Bank Limited, and appointed independent directors to manage them.
These banks have been plagued by massive irregularities and loan anomalies, leading to severe liquidity shortages, preventing them from meeting depositors鈥� demands, according to BB officials.
Since 2017, S Alam Group, allegedly with state agency support, has taken a hostile takeover of six banks, ousting several founding shareholders and directors in the process.
On May 7, the Bangladesh Bank also handed control of National Bank to individuals connected with S Alam Group, leading to allegations of significant money siphoning through anonymous companies.
S Alam Group has been accused of widespread irregularities within the six banks, particularly in recruitment and loan disbursement.
In a press conference on August 28, newly appointed BB governor Ahsan H Mansur described the S Alam scam as the largest banking heist in the world, with the group allegedly siphoning off about Tk 2 lakh crore or $16.6 billion using state mechanisms.
Mansur stated, 鈥業 am unaware of anyone else globally who has looted banks on this scale and in this manner.鈥�
He added that assets under S Alam鈥檚 name and anonymous ownership would be sold to compensate depositors and warned people against purchasing these assets.
The loan irregularities under S Alam Group鈥檚 control have pushed these banks into a severe liquidity crisis, forcing them to rely on central bank bailouts.
Many of these irregularities occurred under the watch of the Bangladesh Bank, with alleged involvement from some of its senior officials.
S Alam Group鈥檚 troubles escalated when Sheikh Hasina resigned as prime minister and fled to India on August 5 amid a student uprising.