Bangladesh Bank will not launch any fresh investigation specifically targeting former president Mohammed Shahabuddin, who recently resigned from office. However, the central bank says legal action will be taken if ongoing bank-related investigations establish his involvement in any irregularities.
Speaking to reporters at Bangladesh Bank on Sunday, Executive Director and spokesperson Arief Hossain Khan said the central bank does not investigate individuals solely because of their office or identity.
“Bangladesh Bank does not conduct investigations targeting the President or any individual. However, if a person’s involvement emerges during a bank-related investigation, decisions will be taken in accordance with the law,” he said.
He added that Shahabuddin had constitutionally held the country’s highest office and, therefore, no separate investigation would be initiated against him personally.
“As part of the financial sector reform process, investigations are under way into a number of banks. If anyone’s involvement is found in those investigations, it will be dealt with accordingly,” Arief Hossain Khan said.
Before becoming president, Shahabuddin served as vice-chairman of Islami Bank Bangladesh PLC until February 2023. He joined the bank’s board in June 2017 as the nominee director of JMC Builders, a Chattogram-based company, several months after S Alam Group assumed control of the bank.
According to Islami Bank documents, JMC Builders has been identified as a proxy company linked to S Alam Group. It has been alleged that the company borrowed funds from another private commercial bank to acquire shares in Islami Bank and secure a board seat, with Shahabuddin serving as its nominee director.
Special forensic audits conducted by Bangladesh Bank uncovered widespread financial irregularities and large-scale loan scams at Islami Bank and several other banks controlled by S Alam Group.
During its investigation, the Bangladesh Financial Intelligence Unit (BFIU) identified 24 companies allegedly involved in transactions through which they acquired control of 81 per cent of Islami Bank’s shares. After the BFIU submitted its report to the High Court, the court directed the Anti-Corruption Commission (ACC) to investigate the matter. The court also imposed travel restrictions on individuals named in the investigation while the inquiry remains under way. The next hearing is scheduled for Wednesday.
As a former director of Islami Bank, Shahabuddin’s name has also been discussed in connection with the broader investigation.
Arief Hossain reiterated that Bangladesh Bank does not carry out investigations targeting specific individuals.
“The central bank regularly inspects commercial banks. Banks also conduct internal audits, while external audits are carried out independently. If any irregularity is detected during an investigation, Bangladesh Bank takes action. Where an individual’s role is identified, the involvement of the board is also examined,” he said.
Shahabuddin resigned from Islami Bank’s board in 2023 after being nominated for the presidency. Around the same time, Ahsanul Alam, son of S Alam Group chairman Mohammed Saiful Alam, became chairman of the bank.
Following the political change in 2024, Bangladesh Bank dissolved the boards of Islami Bank and several other private commercial banks and appointed new boards. Despite two rounds of board restructuring, Islami Bank has yet to receive a full-fledged board and is currently being managed by a single-member committee.
