The Bangladesh Bank might be empowered to temporarily freeze suspicious accounts and confiscate illegal wealth without any court order, in a bid to step up efforts against financial crimes, according to a draft amendment to the Anti-Money Laundering Act (AMLA). Currently the central bank cannot freeze accounts without a court order.

The finance ministry will seek the amendment to AMLA, which also proposes that failure to explain sources of wealth should be considered a violation of the act and a criminal offence. The power of the central bank would be boosted by the amendment, as it would be able to seize assets suspected of having links with corruption for a month, and would also be able to freeze bank accounts for a month upon similar reasonable suspicion. The freeze can be extended for another month if required.

The council of advisers to the interim government will review the proposal to amend the 2002 act at a meeting on March, 19. Fifteen financial crimes have been selected by the finance ministry as related to AMLA in the draft. The listed crimes include corruption and bribery, banknote forgery, forgery of documents, extortion, deception, fraudulence, illegal arms trade, trade in illegal drugs and addictive substances, illegal trading in smuggled goods, abduction, kidnapping and hostage taking, murder and injurious assault, sexual abuse including paedophilia, theft and robbery, human trafficking, and illegal immigration.

Terrorist financing also figures prominently on the list. Definitions, investigations, trials of cases, and sentencing of the convicted in connection with terrorist financing would be carried out in line with the proposed Antiterrorism Act 2007. The draft amendment also proposes creation of a Confiscated Assets Fund by the central bank with seized illegal assets. The fund would provide money for adjudication of cases against corrupt individuals.

Banks, courier services, financial institutions, insurance companies, micro-credit institutions, money exchange centres, money transferring companies, professionals including lawyers, accountants and auditors, post offices, real estate developers, shares and securities dealers and brokers, sub-registrars offices, NGOs, cooperative banks and associations, and charity organisations would be compelled to provide any financial information the central bank asks for, according to the draft proposal.

At the meeting the finance ministry will also seek amendments to the Bank Company Act 1991 to bring changes in the definition of defaulted loan, and will seek to double the existing required amount of capital for commercial banks.

The draft proposes increasing the required capital for commercial banks to Tk 200 crore from the existing Tk 100 crore. The proposal also redefines defaulted loan and brings down the overdue period of repayment to three months from the current six months.

The proposal seeks to cut short the tenure of board members of any bank. It proposes a Tk 20 lakh fine against any bank for breaching the act; the highest fine for such offences is Tk 2,000 now. The draft also proposes to keep the size of a banks board within 13 members. If members of any family have 10 percent share of a bank, two from the family would be its board members, but if the share is less than 10 percent, one member of the family would be the banks board member.

None would be allowed to be a member of the board of directors of a bank for more than six years in two terms, according to the draft amendment.