S Alam seeks govt support to recover from business losses

Chattogram-based business conglomerate S Alam Group has requested that the government provide financial, social and legal support for recovering the business it lost due to the freezing of its different bank accounts.
The business conglomerate made the request through a letter sent to the governor of Bangladesh Bank and the head of the Bangladesh Financial Intelligence Unit (BFIU) on September 12.
A copy of the letter, signed by Mohammed Delwar Hossain, general manager for accounts and finance at the S Alam Group, was also reportedly sent to the adviser to the finance ministry.
In the letter, the business conglomerate said different companies under the S Alam Group, owned by Mohammed Saiful Alam, have been maintaining accounts with banks and had sufficient funds to ensure business operations.
The group alleged that Islami Bank Bangladesh initially stopped providing services to the group’s companies on August 8.
Gradually, other banks, including First Security Islami Bank PLC, Global Islami Bank PLC and Union Bank PLC, followed suit without providing prior notice.
“Those lenders have declined to send letters on the service suspensions and we believe that it is an arbitrary, discriminatory act on their part as well as a violation of the client-bank relationship,” it said.
The letter said that after being contacted, the banks informed that the accounts were frozen as per verbal instructions from the BFIU.
Due to this, their companies are now facing difficulties and incurring huge losses.
The letter added that those companies were failing to pay salaries and wages timely, which may lead to labour unrest in many industrial areas.
Furthermore, the companies have been unable to pay utility bills, which could lead to line and service disconnections and consequently halt production in manufacturing units.
Moreover, the companies have been unable to deposit taxes and sales proceeds, transfer and receive funds from trade receivables, or pay for expenses, including for bank liabilities and foreign letters of credit (LCs), it said.
Contractual obligations with foreign and local suppliers and clients could not be honoured on time and interest is being charged for delayed payments, it said.
LCs relating to industrial raw materials for food and allied products have been cancelled by different scheduled banks, for which the country may face a crisis of food and other materials within a short time, warned the letter.
Non-payment of bank liabilities may lead to loan classification at any time, it said, adding that most employees were leaving.
A senior official of the BFIU confirmed to The Daily Star that they received the letter.
Husne Ara Shikha, executive director and spokesperson of Bangladesh Bank, confirmed that the central bank had received a letter after being contacted by The Daily Star.
The BFIU did not instruct banks to freeze or suspend the accounts of businesses or institutions of the group, she said, adding that it had instructed banks to freeze personal accounts related to the group.