RCBC eyes lawsuit against Bangladesh Bank over heist claims

MANILA, Philippines – Listed Rizal Commercial Banking Corporation (RCBC) is considering filing a lawsuit against Bangladesh Bank officials for claiming RCBC’s involvement in the $81-million cyber heist two years ago.

The Yuchengco-led bank’s statement comes after the Bangladesh central bank’s announcement that it would file a lawsuit in New York against RCBC over alleged involvement in the world’s largest cyber heist in history.

“We will not allow them to continue to malign RCBC. Various reports, including their own, indicate an inside job,” the listed Philippine bank said in a statement on Thursday, February 8.

Bangladesh Bank and Dhaka officials “refuse to release their findings to hide from the Bangladeshi public what could very well be the involvement of its own officials who may have helped loot their money deposited with the New York Federal Reserve,” RCBC said.

Hackers tried to steal close to $1 billion from the Bangladesh Bank account with the Federal Reserve Bank of New York in February 2016. The US bank was able to stop 30 of the 35 transactions.

However, 5 transactions involving $81 million entered the Philippines via RCBC through several fictitious accounts. The funds were laundered through several casinos as these were not covered by the Anti-Money Laundering Act (AMLA).

The scandal led to the resignation of RCBC president and chief executive officer Lorenzo Tan who was eventually replaced by former Development Bank of the Philippines president Gil Buenaventura.

It also led to changes in the Philippines’ AMLA. In May 2017, RCBC fully settled its record P1-billion fine for non-compliance with banking laws and regulations in connection with the scandal.

On Wednesday, February 7, Bangladesh Bank Deputy Governor Razee Hassan told Agence France-Presse that his office’s lawsuit against RCBC “would be filed in April.”

“If they sue, RCBC is ready and prepared. The first thing we will ask is for BB and Dhaka to submit to court their findings,” RCBC replied.

“If they refuse, they will immediately suffer from comparison since RCBC willingly shared information to the extent allowed by law. And why sue RCBC when they should be suing instead their own, the criminal elements from within?” the bank added.

RCBC questioned why Bangladesh Bank is not going after those who have been identified as having possession of the remaining money. (READ: How Bangladesh Bank dirty money easily got into PH)

“There is none left in RCBC. It is time for Bangladesh Bank and Dhaka to come clean and give its people answers,” RCBC said.

After the scandal, the bank owned by the late taipan Alfonso Yuchengco launched initiatives to reinforce its anti-money laundering framework.

It embarked on a branch transformation project, aimed at separating the sales and service functions of its business centers. This led to the creation of a centralized unit acting as an additional layer to ensure the proper implementation of the Know Your Customer (KYC) policies and monitor proper adherence of bank correspondents to standard operating procedures.

RCBC also centralized the review and disposition of Base60 alerts with the anti-money laundering department and compliance office compared to its previous role as just approvers. – Rappler.com