Procurement irregularities raise questions over use of taxpayers’ money

Public money is meant to buy quality equipment and build durable infrastructure. But allegations of inflated prices, rigged evaluations and substandard machinery in government procurement are raising fresh concerns over the misuse of taxpayers’ money.

The fallout could go beyond financial losses, affecting public safety, health and the quality of essential services.
An investigation has uncovered allegations of irregularities, possible fraud and the influence of powerful contractors in the procurement of heavy machinery by several city corporations.

According to documents obtained during the investigation, Mymensingh City Corporation has purchased heavy machinery worth nearly Tk 100 crore in the seven years since its establishment in 2018. A significant portion of these contracts went to just two companies�"Sohel Engineering and HTMS.

In August 2024, Mymensingh City Corporation invited tenders to procure a new 13-ton wheel dozer. Sohel Engineering won the contract and supplied a dozer of the Rhino brand.

According to the tender conditions, the machine had to be manufactured in any one of 23 specified countries, including the United States. China was not on the list.

However, documents obtained by the Daily Observer show that Rhino Equipments of the United States itself imports the RWD132-S model dozer from Changzhou Rhinoceros Unicornis Machinery in China. The same model was subsequently supplied to Bangladesh, raising questions over whether the tender condition regarding the country of manufacture was violated.

In June this year, another work order worth around Tk 15 crore was awarded for the supply of machinery of the same brand. China was again absent from the list of approved manufacturing countries in the latest tender. Nevertheless, the same brand of equipment was proposed for supply.

Documents submitted by Rhino Equipments identify an address in Florida as the company’s factory. However, its website describes the same address as its “Global Commercial & Operations Office” and contains no information indicating that a manufacturing facility operates there. Rhino Equipments also claims to be a member of the American Association of Equipment Manufacturers (AEM). However, no company by that name could be found in AEM’s publicly available membership directory.

Information obtained from the City of Miami further indicates that Rhino Equipments is primarily a merchant and wholesale business, suggesting that it purchases machinery from overseas and sells it rather than manufacturing the equipment itself.

Questions have also been raised over the evaluation of bids in a June tender floated by Mymensingh City Corporation. Bangladesh Science House was the lowest bidder, but the contract was ultimately awarded to Sohel Engineering and Construction Limited.

The city corporation deemed Science House’s bid for Japanese Komatsu equipment technically non-responsive, citing a hydraulic tank capacity of 69 litres against the required 70 litres and 43 shoes on each side against the stipulated minimum of 44.

However, documents show that the Rhino machine proposed by Sohel Engineering had a hydraulic tank capacity of only 40 litres and 39 shoes on each side�"apparently greater deviations from the tender specifications. This has raised questions over how Sohel Engineering was declared technically compliant.

Sohel Engineering is not the only company facing scrutiny. HTMS has supplied machinery worth hundreds of crores of taka to various city corporations, the Roads and Highways Department and other government agencies. It also received work orders from Mymensingh City Corporation for equipment including vacuum loaders and wheel loaders.

According to available information, the Anti-Corruption Commission (ACC) blacklisted 14 contractors and their owners on December 12, 2019, over alleged irregularities. The name of HTMS Managing Director Aftab Ahmed was included in the list, when his company was known as ASL.

There have also been allegations that the company began operating under a new name after the blacklisting and later faced restrictions over alleged irregularities in supplying products to the Trading Corporation of Bangladesh (TCB).

TIB Executive Director Dr Iftekharuzzaman said irregularities in public procurement remain a serious concern. “If they are not identified immediately, the BNP government will have to pay the price very soon,” he said, warning that procurement irregularities waste public money and threaten the quality of government services.

Mymensingh City Corporation Chief Engineer and Tender Committee member Rafiqul Islam Mia denied the allegations, saying there was no scope for importing the equipment from China. He said officials had personally inspected the US factory but declined to provide photographs of the inspection.

Sohel Engineering proprietor Abdul Aziz Sheikh also denied the allegations, saying the corporation received a US-made Rhino wheel dozer, not a Chinese product. He claimed officials visited the United States for a pre-shipment inspection but declined to provide further details.

Project Director Arifur Rahman said he was unaware of the alleged irregularities as he joined the project about five and a half months ago and was not present during the inspection.

Aftab Ahmed said the earlier blacklisting of his company related to an incident seven or eight years ago and was later withdrawn. He claimed the action lacked legal basis and said a court subsequently stayed the decision. According to him, the company now mainly operates under the name STMS.