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Aladdin's Cheragh of S Alam
The documents of Bangladesh Bank also show that several companies have sent 1 lakh 7 thousand US dollars to Singapore through legal means, out of which not a single company is owned by S Alam.
Mohammad Saiful Alam, the owner of S Alam Group, has built a business worth at least one billion US dollars in Singapore. Although he did not take any permission from Bangladesh Bank to invest or transfer money abroad, according to The Daily Star's investigation.
The Central Bank of Bangladesh has so far allowed 17 companies to invest outside the country, but the name of this large Chittagong-based company is not in the list. The papers also show that S Alam has bought at least two hotels, two houses, a commercial space and other assets in Singapore over the past decade, and there too his name has been removed from the papers in various ways.
According to Bangladesh Bank documents, 40.15 million US dollars have been taken from the country for foreign investment till January 10, 2023.
However, this amount is only a tenth of the US$411.8 million that S Alam bought in Singapore after 2009 for just two hotels and a commercial space.
The documents of Bangladesh Bank also show that several companies have sent 1 lakh 7 thousand US dollars to Singapore through legal means, out of which not a single company is owned by S Alam.
Daily Star wrote to Bangladesh Bank to inquire about S Alam's investments abroad, but they did not respond.
Investing abroad is officially no secret. Still, the central bank appears to be treating the matter as top secret.
However, three senior officials of the central bank said on condition of anonymity that S Alam never took any permission from them to take money abroad.
One of them told the Daily Star , 'You can be sure that S Alam never took permission from Bangladesh Bank to send money abroad.' Two others also confirmed this information separately.
According to Bangladesh Prevention of Money Laundering Act, 2012, investment abroad is prohibited without the permission of the central bank. The offense is punishable by a maximum imprisonment of 12 years and a fine of twice the amount of the money laundered.
Saiful Alam founded S Alam Group in 1985 and since then it has grown into one of the largest conglomerates in Bangladesh.
Its business scope spans from commodity trading to fishing, construction materials to housing, textiles to media, intercity buses to shipping and energy and power to banking, insurance.
S. Alam was contacted twice in writing on July 6 and July 23 to get a statement on the inquiry of Daily Star . We sent him several written questions regarding his investments and sources of funds abroad, seeking his comments on the matter. Both times he replied through his lawyer A Hussain & Associates . It said he would not respond unless the entire news report was sent to him before publication — which is not journalistic practice.
Singapore to British Virgin Islands via Cyprus
S Alam and his wife Farzana Parveen have woven a wide web of offshore businesses, according to documents obtained by the Daily Star . Our search also found S Alam and his wife's investments in Singapore, British Virgin Islands and Cyprus.
The small Mediterranean country of Cyprus launched its 'Golden Passport' program in 2007. According to several international business consulting firms, the scheme offers Cypriot citizenship to wealthy foreigners in exchange for an investment of around 2 million euros ($2.5 million) in the country's housing sector and another 200 million euros in grants to the Cyprus government's research and land development fund.
Two years later, on 27 August 2009, Saiful Alam and Farzana Parveen established Canaly Logistics Pvt Ltd in Singapore, claiming to be Cypriot nationals and Singapore residents, according to company profile information from the Accounting and Corporate Regulatory Authority of Singapore (ACRA).
The company's issued and paid-up share capital at that time was US$22.34 million (S$30 million). S Alam and his wife were the sole shareholders. Alam controlled 70 percent of the 30 million shares and his wife the remaining 30 percent.
By investing in Singapore, foreigners are allowed to stay in the country with a residence permit.
Click here to view related documents
Some of the world's largest corporations operate from Singapore, including some Bangladeshi business groups. According to the Offshore Leaks Database compiled by the International Consortium of Investigative Journalists (ICIJ) , about 6,000 shell companies (namely entities) are linked to Singapore.
Apart from this, S Alam and his wife are also associated with Peacock Property Limited, another offshore shell company in the British Virgin Islands. The British Virgin Islands, more than 17,000 kilometers from Singapore, is a tax haven or tax haven where there is no income tax, corporate tax or capital tax.
Orek Kar Swarg bought another company in Cyprus in 2016 called S Alam Aclair Investment Limited . According to the Cyprus Registrar of Companies Department and Official Receiver documents , the company name was later changed to Acceler International .
Executive Director of Transparency International Bangladesh. Iftekharuzzaman said, 'This is a clear example of illegal financial transactions. Especially if there is no credible evidence that the money paid for golden passports, investments and asset purchases outside the country and offshore companies in tax havens—some of these came from legitimate foreign income.'
The former governor of Bangladesh Bank. Salehuddin Ahmed said there are two legitimate ways to send money abroad for business or investment. One of them is that a certain portion of the exporters' retention quota is 'exclusively for the payment of import and foreign debts of exporters or their subsidiaries and affiliates'. Another is to get permission from Bangladesh Bank to invest abroad.
"But that does not mean that they will set up separate institutions and do business there," he said without mentioning any names. Can do anything helpful. Bangladesh Bank has allowed a handful of companies to invest abroad.
I want a golden deer
On 26 August 2014, five years after its opening, S Alam's Canaly Logistics signed a deal to buy the 328-room Grand Chancellor Private Limited Hotel in Singapore's 'Little India' for US$177 million. This information was disclosed in a circular sent by the hotel owners to their shareholders and the Singapore Securities Exchange .
According to the contract, 'the contract price will be paid in cash in installments.' The circular also states that Canaly has already "paid 18.6 million Singapore dollars (about 14 million US dollars) including the initial deposit and balance deposit" in fulfillment of the terms of the agreement.
A Singaporean law firm represented the hotel in the deal.
According to recent documents obtained by the Daily Star , Hotel Grand Chancellor's filings with Singapore's regulatory agency ACRA show that the hotel's total assets at the end of 2021 were US$314 million and annual revenue was about US$7.4 million.
A year after the acquisition, the hotel was renamed Grand Imperial Hotel Pvt Ltd and now operates under the brand name of Hilton Garden Inn Serangoon in the heart of Singapore.
According to the Singaporean media The Business Times, in 2016, Canaly bought a commercial space of 27 thousand square feet on the 19th floor of Centrium Square in Singapore for 100.53 million US dollars.
A year after the acquisition, Canaly Logistics changed its name to Wilkinson International Pvt Ltd , which in 2021 had a total asset value of around US$1 billion (Tk 10,000 crore). At the time of writing this report, Singapore authorities did not have any documents for 2022.
As the company bought one property after another, its three-year annual income statement data showed that the company's expenses were higher than its income.
Wilkinson's financial statements show his annual earnings never exceeded $78 million between 2019 and 2021. It was USD 35 million in 2020 and USD 36 million in 2019.
Wilkinson's financial statements also show that the company invested at least $567 million between 2019 and 2021, which is several times the amount they earned.
At the same time, the company received funding of USD 458 million.
While the financing could come in the form of equity or debt, analysts looking at the documents say that since Alam and his wife were the sole shareholders at least until the end of 2020, the money is more likely to be a bank loan or a cash loan.
Behind the fog
Singapore's vast business empire operates behind an address that exists only on paper.
The Daily Star sent a source to Wilkinson's registered address, who saw Wilkinson's official address at Ocean Financial Center on Collier's Quay Road in a business directory. Wilkinson International was not named there. But find the name of the legal entity involved in the company's hotel purchase agreement at the same address.
As of June 2023 on Singapore's government open data portal , 500 shell companies (namely corporations) operate from the building. Although several of them no longer exist.
Alam and his wife resigned as directors of Wilkinson on 16 December 2020 and transferred their ownership to an offshore company in the British Virgin Islands , Peacock Property Holdings Limited . The 2017 Paradise Papers leak exposed the offshore activities of the world's most influential people and companies. Through this, the name of the British Virgin Islands came up in the headlines as a tax haven .
But surprisingly, the Peacock property was also not found at the registered address. Newhaven Corporate Services, an offshore agent registered with the Financial Services Commission of the British Virgin Islands, was found at the same address.
Following the 2017 Paradise Papers leak , the four-storey yellow building was used as a postal office box for offshore companies near the James Walter Francis Highway roundabout in Road Town, the capital of the British Virgin Islands.
Newhaven Corporate was fined US$25,000 under the British Virgin Islands Money Laundering Act in 2015 for not properly engaging or taking customers seriously in business activities and failing to take relevant or additional measures where there was no face-to-face customer contact .
delete name
After removing his name from the Singapore company, Wilkinson appointed a Singaporean named S Alam Ong Le Kim as the sole director of the company. But the Daily Star apparently has no online presence.
Alam's name was also not found in the documents of Hotel Ibis Singapore Novena, which was bought from his company in 2019 for US$126 million .
The hotel's documents submitted to Singapore authorities show it is owned by several entities, all of which are legal entities mentioned above, and its ultimate owner is an offshore company in the British Virgin Islands.
The hotel has been owned by a company called Canopus Two Private Limited since 2013 , but the company's current address and Wilkins' address are exactly the same, even every unit number.
Canopus' sole shareholder is a British Virgin Islands-based company called Hazell International Private Limited , registered at Wilkinson's office address. According to documents obtained from the Accounting and Corporate Regulatory Authority of Singapore, the company was incorporated just 3 months before the sale to S Alam in June 2019.
In addition to tax haven benefits, the British Virgin Islands has the right to privacy, and companies operating in that country are not legally obliged to name their shareholders or directors on any official documents.
Ahsan H. Mansour, executive director of the Policy Research Institute, said, 'Caribbean island countries generally do not take action against shell companies. Because the country wants this money to stay in their country.'
'They don't need taxes. They need investment. So, they can give tax exemption. But we need tax and by taking that money out of the country they (money launderers) are depriving our country of taxes,' said Ahsan H Mansoor, former chairman of BRAC Bank.
He also said that it needs to be stopped at the source, i.e. not allowing these people to own banks.
puppet director
On October 25, 2012, S Alam appointed 'Casino Kingpin' Shahedul Haque as a director in his Singapore company. Shahedul was then the director of Dhaka's Union Bank, which was partly owned by the S Alam Group. S Alam's son Ahsanul Alam became the chairman of Islami Bank in mid-June 2023. Till then he was the Chairman of Union Bank. S Alam Group has significant stake in Islami Bank.
28-year-old Ahsanul Alam is also the current director of S Alam Group.
Shahedul was the director of Union Bank and Wilkinson till 2018.
According to Union Bank's financial report, Reliance Finance, a Bangladeshi company owned by S Alam Group, received placements of more than Tk 2,866 crore from Union Bank during this period. Currently Reliance Finance has changed its name to Aviva Finance.
A placement is the sale of securities or bonds to investors to raise capital.
At the end of last year, Bangladesh Bank found that most of Union Bank's total loans went to 300 local shell companies or nameless institutions after it was published in the media about how the S Alam Group was taking loans from Islamic banks. Bengali daily Prothom Alo published this report at that time.
In 2019, the Anti-Corruption Commission (ACC) raid against illegal casinos identified Shahedul as one of those involved in money laundering using casinos. Later the name 'Casino' was associated with his name 'Casino Shahedul' .
In November last year, a court in Dhaka sentenced him to 5 years imprisonment in the case of illegal acquisition of Tk 32 crore. ACC investigators said Shahedul fled the country and never appeared in court.
According to information available from US open voter records, Shahedul and his wife, Sarina Tamanna Haque, are registered voters in Canton, Michigan and own property there.
Summary of two houses
As of 2021, S Alam and his wife owned a 12,260 sq ft house in Novena, central Singapore, according to records from the Inland Revenue Authority of Singapore.
In 2018, the annual rental value of this asset was 570 thousand US dollars. However, in 2022, Singapore's Zeico Trust Limited became the legal owner.
Information provided on the Zico Trust website states, 'The benefits of forming a trust include privacy and asset protection. Trusts can be set up offshore (outside the settlor's home country) and privately, thereby ensuring the settlor's privacy.'
One of the advantages of a personal trust is asset protection. Since the trustee is the legal owner of the assets, the settlor waives his rights. In most cases it ensures a form of protection against creditors, insolvency and exchange controls, etc.'', the website said.
The couple owned a second home in Singapore until 2023 . Its ownership has also been transferred to Pedang Trust Singapore Private Trust.
Singapore abolished estate tax in 2008. Therefore, capital income distributions from Singapore trusts are tax-free and successors to the Singapore trust can be included as beneficiaries without any estate duty.
In the investigation of the ACC
Money laundering has long been a global problem. Many large corporations and high-profile individuals are operating offshore businesses to evade high taxes in the country. According to Washington-based think tank Global Financial Integrity, between 2009 and 2018 USD 8.28 billion was laundered from Bangladesh every year, which is almost 3 times the cost of Metrorail Line-6 (North to Motijheel).
In the wake of growing allegations of money laundering from Bangladesh, the government proposed an amnesty in the 2022-23 fiscal year, allowing Bangladeshi citizens to repatriate their undeclared money from abroad by paying a 7 percent tax. The government withdrew that opportunity this year.
In 2020-21, when S Alam's empire in Singapore was expanding and changing hands, several media outlets, including the English daily New Age, reported how they were borrowing thousands of rupees from Islami Bank and other Shariah-based banks in Bangladesh .
In 2022, the High Court directed the Bangladesh Financial Intelligence Unit of Bangladesh Bank, the Anti-Corruption Commission (ACC) and the Criminal Investigation Department of the Police to investigate the loan scam after the media published news about the institution's questionable loans one after the other.
In a self-proposed ruling on December 4, 2022, the High Court sought an explanation of the failure and inaction of the defendants to take appropriate legal action against the embezzlement and embezzlement of large amounts of money by taking loans from Islami Bank Bangladesh Limited and other banks under false names, and the unethical processes mentioned and published in the reports of the High Court and some newspapers. And it is also sought to know why fake and non-existent companies or institutions should not be declared illegal due to gross irregularities.
At the same time, the court ordered the defendants to take action against the wrongdoers.
On April 4 this year, the High Court order reached the ACC.
ACC lawyer. Khurshid Alam Khan said, 'We are careful about money laundering. At present we are investigating the issue of lending by Islami Bank.'
Note: Amounts in the report are converted from Singapore dollars as of 3 August.
Related topics:
S Alam GroupMohammad Saiful AlamFarzana ParveenSingaporeBritish Virgin IslandsCyprusmoney launderingBangladesh BankaccinvestmentAladdin's lamp
