Controversial officials of Al Arafah Islami Bank are still in service despite they were found involved in financial irregularities.
On September 3, 2024, Bangladesh Bank (BB) reconstituted the board of directors of Al-Arafah Islami Bank PLC (AIBL) as part of a broader effort to remove the S. Alam Group's control from the bank.
However, the bank's shareholders allege that the controversial officials appointed by the previous board are still in office.
They allege that the Chairman of new board, including some directors, are controlled by a Chattogram-based garment businessman and the bank's board's decisions come from Chattogram for this reason.
Sources said Al Arafah Islami Bank, which started its journey in 1995 as a Sharia-based bank, became popular in a short time due to its customer-friendly programmes.
But after the Awami League government came to power, it came under the control of the controversial S Alam Industrial Group and another business group based in Chattogram.
There were allegations that the top officials of the bank were involved in various irregularities and served the past board's interests.
The representatives of the current board of Al Arafah Islami Bank has visited the Chattogram office a number of times in the last 3 months at the invitation of a Chattogram-based garment trader group, who was a director of the last board.
Sources said that Saiful Alam Masud, the owner of S. Alam Group, has a family relationship with the garments trader group in Chattogram.
The bank's new board of directors is meeting at the office of the Chattogram-based garments trader group before each board meeting. The decision made from Chattogram is the decision that is being made in the board meeting of the bank, some shareholders allege.
According to reliable sources, the S. Alam Group and Chattogram-based KDS Group have been trying to influence the current board chairman and two other independent directors to sell the shares to their trusted companies. They were given hope to become a shareholder director in future.
A report by Bangladesh Bank shows that during the Awami League government, S Alam Group and KDS Group took over the bank in 2009. They forced at least 9 entrepreneur directors outside Chattogram to leave the bank.
Entrepreneur shareholders Abdul Hadi and Md. Ezahar Miah allegedly seized major shares through fraud. They grabbed at least 37.25 (23.75 + 13.50) percent of the total shares of S Alam Group and the KDS Group in the bank through various tricks and corruption.
Kazi Shahed Jamil is serving as the PS of the current board Chairman Khwaja Shahriar. He was an employee of that Chattogram-based garment group.
He was promoted and appointed by skipping five steps. He is still in his position. Not only he, the current board also retained the head of the human resources department, Amir Hossain, and company secretary Moniruzzaman, who were appointed by the previous board.
A senior official of the bank has alleged that all the bank's information is being passed on to S Alam's brother Abdus Samad Labu and another director through the officials.
He claims that the previous board of directors controlled everything inside the bank through Kazi Shahed, Amir Hossain and Moniruzzaman. And due to the influence of the previous board, including S Alam, they have been retained in their positions in the bank.
The corrupt officials appointed by the two former chairmen are still in office. Even against whom various types of irregularities have come to light in the BFIU investigation, no action has been taken.
It is alleged that the current CEO and CFO of the bank have returned Tk 5.4 million that was embezzled through corruption in the bank.
They have been working as close allies of the S Alam Group and the Chattogram-based garment business group for a long time.
Despite the evidence of their various corruptions, the current board has not taken any action against them.
Besides, the new board has started fresh recruitment alongside promotion to various posts including MD, EVP, SVP, VP and AVP in the bank by providing additional increments.
Some shareholders claimed that many old clients are leaving the bank due to inefficiency and lack of fairness in decision-making by bank's current board of directors.
Bank insiders said even though one-third of the fiscal year has passed, the new board has not been able to pass the important budget of the bank. So far, they have not been able to make any decision despite holding five to six meetings.
