Bangladesh to sue US bank over $100m lost to hackers

Bangladesh’s government has said that it will sue the Federal Reserve Bank of New York for failing to prevent $100m from being stolen by hackers from a reserve account for Bangladesh’s central bank.

Dhaka, which accuses Chinese hackers of stealing the money from its foreign exchange account on February 5 and transferring it to accounts in the Philippines, also said it was working to recover the funds.

Bangladesh’s Finance Minister AMA Muhith said on Tuesday that that his government would launch a lawsuit against the US bank, which denied responsibility over the lost funds.

“We’ve heard that Federal Reserve Bank of New York has completely denied their responsibility. They don’t have any right,” Muhith told reporters in Dhaka.

“Of course, we’ll file a case against them. We have kept the money with them. They are responsible,” he said, when asked what action his government would take against the bank.

The New York Fed put out a brief statement through its Twitter account on Monday, saying: “Regarding hacking reports, there is no evidence of attempts to penetrate Federal Reserve systems and no evidence Fed systems were compromised.”

The Bangladeshi bank said it managed to recover some of the funds, but gave no details.

It has also tracked down those still missing and is working with the anti-money laundering agency in the Philippines, which has been ordered by a court in the country to freeze the accounts while the issue is being investigated.

Bangladesh is also working with World Bank cyber and forensic experts, the bank said in a statement.

The country’s leading Bengali-language Prothom Alo newspaper reported on Wednesday that at least 30 transfer requests were made on February 5 using the Bangladesh Bank’s SWIFT code, out of which five succeeded in effecting transfers.

Economist Mamun Rashid, who previously headed Citibank NA in Bangladesh, said he was sure the country would be able to recover the full amount.

“Bangladesh is a client of the Federal Reserve Bank. They must take the responsibility for this incident,” he said. “But we have to see whether we have lodged our complaint properly”.

Since hacking has been a threat for years, he said clients should not suffer if depositing with large banks. “A client’s right must be protected.”