Cashing in influence

Sheikh Hasina’s aide and influential members of parliament are among the powerful backers of the controversial company behind the digital financial service Nagad.

Cashing in influence

As the deputy press secretary to the prime minister, Ashraful Alam Khokan is often seen as a top spin doctor of the Awami League government in Bangladesh. An investigation by Netra News has found that Khokan, one of the closest aides of Sheikh Hasina, also acts as a de facto board member of Third Wave Technologies Limited (TWTL), a company which operates the digital financial service brand Nagad on behalf of the Bangladesh Post Office. Documents obtained by Netra News also confirm that two influential ruling party members of parliament, Nahim Razzaq MP and Razee Mohammad Fakhrul MP, are also major shareholders of TWTL. Another shareholder of the company is Khokan’s wife Rezwana Nur.

Industry insiders accuse the trio — Khokan, Nahim and Razee — of exercising undue influence in helping TWTL get the highly lucrative operating contract for Nagad, and also in allowing the public-private partnership to gain significant preferential treatment over its direct competitors like bKash and Rocket, who must operate with a Bangladesh Bank license and abide by the strict financial regulations enforced by the central bank. Nagad operates freely without any regulatory supervision, using a loophole in the Post Office (Amendment) Act of 2010.

Partners in influence peddling: Razee Mohammad Fakhrul MP (first from left), Ashraful Alam Khokan (second from left), Nahim Razzaq MP (second from right).

The preferential treament also make Nagad’s mobile financial services ripe for money laundering and terrorism financing. These concerns are noted in internal documents obtained by Netra News from different regulatory agencies including the Bangladesh Bank, Anti-Corruption Commission (ACC) and Bangladesh Investment Development Authority (BIDA).

A letter from BIDA, noting the objections about Nagad.

“These guys [TWTL] are disruptive cowboys with little or no experience in the financial services sector, I am using the word ‘disruption’ in a negative sense. Some of them were known for supplying water to [export processing zones] while others were engaged in VOIP telephony. Now they have partnered with the postal department and started Nagad, doing mobile money which is a very sophisticated business,” an industry analyst in Dhaka told Netra News. “If you want to send money using bKash or Rocket, the maximum amount you can send in a day is [Taka 25,000]. This transaction would take place under the [regulatory microscope]. On the other hand, with Nagad you can send [Taka 250,000] and there is no regulator looking at that transaction. We are not sure how they are pulling this off but someone very powerful is backing them. Until [Nagad] appeared on the scene, this used to be a very well-regulated and well-disciplined sector.”

Nagad — which is a public-private partnership between Bangladesh Post Office (51%) and TWTL (49%) — has also been using the prime minister, Sheikh Hasina, and her son Sajeeb Wazed in its marketing material, skillfully exploiting its special ties to the prime minister’s office (PMO) in Dhaka.

Happy models? Sheikh Hasina and Sajeeb Wazed Joy in Nagad marketing material.

Elusive shareholders

According to business registry documents obtained by Netra News from the Registrar of Joint Stock Companies and Firms (RJSC), Third Wave Technologies Limited (TWTL) was incorporated in November 2016 (registration number: C-134027) with five shareholders owning a total of 10,000 shares. The two biggest shareholders were Kazi Monirul Kabir (3000 shares) and Tanvir Ahamad Mishuk (2350 shares).

Extract from the Memorandum of Association of TWTL.

According to RJSC records obtained by Netra News in the first week of February 2020, the shareholding structure of TWTL changed significantly on July 16th 2017, when all of Kazi Monirul Kabir’s shares were divvied up between Tanvir Ahamed Mishuk and three other new shareholders: Nahim Razzaq (1200 shares), Razee Mohammad Fakhrul (1200 shares), and Rezwana Nur (500 shares).

Extract from the Schedule X document obtained from the RJSC, listing TWTL shares.

When Razee Mohammad Fakhrul MP was asked by Netra News about his association with TWTL, he said, “That is my friend’s [Tanvir Ahamed Mishuk] company.” When he was reminded that he himself is one of the owners of the company and owns 1200 TWTL shares, the MP immediately hung up the phone. He then texted Netra News the mobile number of Tanvir Ahamed Mishuk, adding, “No comments. Please get details from [the] company directly.”

On being told that Netra News was working on a story about Nagad, Tanvir Ahamed Mishuk responded, “Sure, sure… I have to call you back later [about this], in an hour.” Since then, neither Tanvir Ahamed Mishuk nor Razee Mohammad Fakhrul MP responded to repeated contact requests by Netra News.

Razee Mohammad Fakhrul MP did not disclose information about his stake in TWTL in the affidavit he submitted to the Bangladesh Election Commission (EC) before the 2018 general election. In the affidavit, the MP did list his shares of other companies.

Extract from Razee Mohammad Fakhrul’s affidavit to the EC.

Nahim Razzaq MP indicated to Netra News that he once owned shares in TWTL, “I do not hold share[s] with TWTL anymore. Thank you.” He, however, refused to say when he stopped being a TWTL shareholder. As Netra News obtained the business registry documents in the first week of February, it is possible that Nahim Razzaq ceased being a TWTL shareholder very recently.

Undue influence

Industry insiders told Netra News that the two MPs were involved with TWTL from an early stage, and that they exercised undue influence to help the company win lucrative government contracts.

“The relationship [between TWTL and the MPs] started even before they became shareholders,” one of the insiders told Netra News. “This was a company that was set up [towards the end of] 2016. And by [April 2017] they were awarded a lucrative deal with the [Ministry of Posts, Telecommunications and Information Technology]. Just like that, no track record nothing, [TWTL] started doing government projects.”

Photos shared with Netra News confirm that both Nahim Razzaq MP and Razee Mohammad Fakhrul MP were “special guests” at an event in April 2017, where the post and telecommunications ministry signed a Memorandum of Understanding (MOU) with TWTL, when it was awarded a contract for marketing postal cash cards on behalf of the post office.

Tarana Halim MP, who was then the state minister in charge of the Post and Telecommunications Division, was the chief guest at the event. At that time, neither Nahim Razzaq nor Razee Mohammad Fakhrul owned any TWTL shares. Both of these MPs became major shareholders in TWTL three months later, in July 2017. And by December 2017, TWTL was awarded the highly lucrative contract for operating Nagad services.

Tarana Halim and Nahim Razzaq MP at the April 2017 MOU-signing event.

Responding to a question about his presence at the MOU-signing event in April 2017, Nahim Razzaq MP told Netra News, “My involvement with the Ministry of Telecommunication[s] is through my representation as an adviser of e-CAB (e-Commerce Association of Bangladesh). At the stated meeting and MOU signing ceremony, members of e-CAB [were] present as a part to digitize the Bangladesh Post Office and to promote e-commerce. My presence was a part of the delegation of e-CAB as stakeholder.”

An e-CAB official confirmed that both Nahim Razzaq MP and Tanvir Ahamed Mishuk are associated with e-CAB but the organisation had nothing to do with the MOU-signing between TWTL and the ministry. “There was no representation of e-CAB at this ceremony,” they said. The official also said Razee Mohammad Fakhrul MP was not affiliated with the organisation. Netra News shared photos from the event with the e-CAB official, who said they only recognised two e-CAB affiliated individuals there: Tanvir Ahamed Mishuk in the audience and Nahim Razzaq MP on stage.

Although Nahim Razzaq MP claimed that he had some form of involvement with the post and telecommunications ministry as an adviser of e-CAB, just a few minutes later he texted Netra News, “[The] accusation of my influence is baseless since I am not involved with the Ministry of Telecommunications, nor in the parliamentary standing committee of ICT or telecommunications. Can you substantiate any evidence of undue influence from my part? If you find any anomalies (any loophole or [lack of] oversight from BPO’s [Bangladesh Post Office] part) in the process involving TWTL, [please] inquire [with] BPO. I am not involved with TWTL anymore hence further discussion is unnecessary.”

When asked how would he explain a potential conflict between his duty as a lawmaker and his private interest as a part-owner of a company which has been allowed to operate without a licence from the central bank, the MP responded, “As a legislator, my opinion regarding a dispute between a private entity and a government initiative needs to assess whether we are considering a monopolistic or a competitive environment for the betterment of the general population. This is a deep and long discussion which needs a different platform to explain. Thank you for your understanding.”

Director by proxy

Another person accused by industry insiders of misusing his position and influence for private gain is Ashraful Alam Khokan, the deputy press secretary at the PMO who takes part in TWTL board meetings, apparently on behalf of his wife, Rezwana Nur, who is one of the seven shareholders of the company. Rezwana has no visible record of previous business engagements. Khokan’s involvement in the company is a likely violation of government service rules.

An employee at the Nagad head office in Banani told a Netra News reporter that they never saw Rezwana Nur at their office, even though she is a TWTL shareholder, “She is a housewife. I only saw her photos on Facebook when [Khokan] shared them.”

Ashraful Alam Khokan (second from left) at Nagad office.

Rezwana’s husband, on the other hand, is a regular visitor to the office. Several individuals with access to the Nagad office independently confirmed to Netra News that Khokan attends all the Nagad/TWTL board meetings and is present during all major events at the office.

Ashraful Alam Khokan (front, third from left) attending a rooftop birthday party at Nagad office.

“Khokan, Mishuk, and [Maruful Islam] Jhalak [one of the directors of Nagad] are very close. They are always together, taking decisions about day-to-day business of the company,” one industry insider told Netra News. Photographs lend credence to this claim.

Ashraful Alam Khokan having lunch with Nagad directors.

We were also able to obtain evidence that show Khokan attended a seminar on technology and financial services in London along with Tanvir Ahamed Mishuk and Maruful Islam Jhalak. The seminar was organised by the Bangladesh High Commission in the first week of February. Khokan’s name was not on the list of invited guests at the seminar and we could not find an order at the PMO approving his foreign trip. As the deputy press secretary to the prime minister, attending seminars on financial services does not fall within Khokan’s usual duties.

Ashraful Alam Khokan attending the seminar in London, where Tanvir Ahamed Mishuk was a panelist for a session on Fintech.

Khokan did not respond to repeated requests for his comments for this story.

Wrist of luxury: Ashraful Alam Khokan sporting a Hublot Big Bang wristwatch. In an email, Netra News asked him if he bought the watch himself or received it as a gift. The deputy press secretary to the prime minister did not respond to our queries.

Response by Mustafa Jabbar

Netra News contacted Mustafa Jabbar, the current minister of post and telecommunications, for his comment for this story. He told us he is not aware of any corruption, influence peddling, or other irregularities in the TWTL-Bangladesh Post Office partnership. However, he added that the decision to award TWTL the contract for Nagad was already taken before he became minister, “Listen, this was already determined. This was simply launched during my term. I have not received any complaints [about] this before. No one complained about this before.”

When he was asked if he would take any action concerning the claims relating to the three men and TWTL, the minister said, “If there are any grounds for taking action, that is my responsibility. I shall see.”

Mustafa Jabbar also shared his philosophical view on the concept of influence with Netra News, “You see, the word ‘influence’, it has no material shape. If someone smiles nicely even then you can call it ‘influence’. If someone lobbies for something, that too can be called ‘influence’. One can explain these things as one pleases. This can not be a basis.”●

[Note] London-based journalist Tanvir Ahmed has objected to the use of a specific photograph in this story. The photograph was obtained by Netra News as evidence of Ashraful Alam Khokan’s attendance at a seminar in London in February 2020.

Tanvir Ahmed, who was also attending the seminar, posted this photo on his Facebook profile on February 4th, with a caption noting how he “unexpectedly” met Ashraful Alam Khokan at the event.

We included the photograph in this report considering its evidential value in a journalistic investigation. We would like to clarify that the only connection Tanvir Ahmed, the London-based journalist, has with this report is that he was a witness to an event described in this report.

We would also like to emphasise that Tanvir Ahmed, to the best of our understanding, is not connected to Nagad or TWTL, and that he and Tanvir Ahamed Mishuk (the managing director of Nagad) are not the same person.

To ward off any further confusion, we have removed the likeness of Tanvir Ahmed from the photograph. This story is being updated with this note on March 8, 1:25 AM (CET).