Traders and investors in Bangladesh found guilty of misdeclaration of exports, imports and investments abroad will be sentenced to seven years in prison as the country continues its clampdown on trade-based money laundering (TBML).
The move is one of several measures taken by the authorities in its efforts to stem TBML.
Over- and under-invoicing
The punishment for TBML was announced by the finance ministry when it issued an order on 10 March under the auspices of the foreign exchange regulation act.
Over- and under-invoicing accounts for some 80 per cent of money laundered in Bangladesh according to Global Financial Integrity. The Washington-based think tank focused on illicit financial flows reckons Bangladesh loses around US$7.53 billion per year through trade misinvoicing.
Harsher penalties
The Finance Act 2020-2021 meanwhile imposed a penalty of a 50 per cent tax to be levied on any proven amount of over- or under-invoicing, or on the proven amount of any false declaration of investments.
Banks however have been given eight more months to comply with the central bank’s guidelines to curb money laundering according to Bangladesh’s financial intelligence unit.
It issued a circular on 8 March that says the deadline has been extended to 30 June 2021 on account of the coronavirus pandemic. The initial deadline was 1 November 2020.
Categories: Trade Based Financial crimes News
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