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2 money changers ordered to shut HSIA operations

ASM Saad
28 Feb 2024 21:56:59 | Update: 28 Feb 2024 21:56:59
2 money changers ordered to shut HSIA operations
— File Photo

The Bangladesh Bank has directed two money changers to close all operations at Hazrat Shahjalal International Airport (HSIA) to maintain discipline in the forex market. Failing to follow this central bank directive will result in the two changers losing their license.

These two money exchanges are Avia Money Changer and Imperial Money Exchange, a senior central bank official told The Business Post on condition of anonymity on Wednesday.

The Bangladesh Bank sent the directions on February 8 and instructed them to halt activities in the airport within a month. This means their activities in HSIA have to stop before March 9.

The central bank found many irregularities in the two money changers. These changers reportedly sold USD to customers at a higher rate, and the regulator also found that these changers lack transparency in the process of buying and selling USD.

Moreover, even though these changers provided receipts to customers buying USD, they reportedly did not deposit the USD to customers’ accounts.

A number of money changers, preferring to be anonymous, told The Business Post that usually thousands of expatriate workers and travelers from abroad come to Bangladesh through the airport every day.

They exchange USD for Bangladeshi Taka at various foreign exchange booths and money exchangers at the airport.

Foreign currency encashment vouchers are to be paid to the encasher as per regulations, but money changers accept foreign currency directly without giving vouchers, or provide fake vouchers, in exchange of money.

They also issue unsigned, fake vouchers or encashment slips. Money changers purchased these foreign currencies did not include them in the authorized accounts of the institution as principal.

As a result, these foreign currencies are not added to the central reserve. This creates a shortage or crisis of foreign currency in the country.  Moreover, they sold USD to others at higher rates.

They are also involved in the volatility of the USD market at the airport.  As part of its measures to stabilise the kerb market, the central bank is taking punitive measures against such money changers.

Moreover, the regulator had suspended many money changers’ operations in recent years. Several times, the central banks’ inspection team monitored the money changers in a bid to stabilise the USD market, when the market started becoming volatile.

Bangladesh Bank Executive Director and Spokesperson Mezbaul Haque said, "We have directed them to stop their activities and to operate out of the airport. If they do not follow the instructions then the central bank will take the necessary steps."

On the other hand, the central bank found that five banks are operating excess booths in the Hazrat Shahjalal International Airport without license.

These banks are – Janata Bank, Agrani Bank, Sonali Bank, Standard Bank, and Probashi Kallyan Bank. The Bangladesh Bank directed that they will have to apply for a licence to the regulator.