In the wake of the public uprising that led to the ousting of the autocratic government of Sheikh Hasina, allegations of corruption have surfaced against multiple business entities across Bangladesh.
Accusations suggest that these firms colluded with the fallen regime to expand their operations, prompting strict measures such as account freezes and other regulatory actions post-regime change. These measures have led to a state of crisis within the affected businesses.
Amidst these developments, several firms have had receivers appointed to oversee their operations.
Historical precedents of receivership appointments in industrial contexts within the country have seldom yielded positive results; many previously thriving businesses have struggled to survive under such administrative oversight.
Consequently, debt repayment and business continuity have become even more precarious.
Business owners and workers have expressed distress over the recent wave of receivership appointments.
According to business leaders, any punitive measures for corruption or criminal conduct should target individuals rather than jeopardise the viability of enterprises, employment, and the broader economy.
The priority, they argue, should be sustaining business operations for the country's economic benefit.
Former president of DCCI, Abul Kasem Khan, highlighted the anxiety among business owners regarding potential administrative interventions: "Business morale has plummeted due to the fear of administrators taking over operations. Economic activities have already been negatively impacted by law and order issues, high-interest bank loans, and inflation. In addition, some private commercial enterprise owners have found themselves listed in red as targets of political vengeance."
Explaining the rationale behind appointing receivers, High Court lawyer Shihab Uddin Khan noted that receivers are deployed when a business is deemed unmanageable or unable to continue operations. Receivers serve in an interim capacity, either through government executive orders or judicial directives.
Former Director General of the Anti-Corruption Commission and ex-District Judge Md Moidul Islam elaborated on the receiver’s responsibilities, which include submitting financial records to the court and bearing accountability for asset preservation.
In instances where defendants are acquitted, their seized assets must be returned, necessitating careful stewardship of attached properties.
Recently, the High Court instructed Bangladesh Bank to appoint a receiver to manage all assets of Beximco Group for six months.
However, upon appeal by Beximco Group, receivership at Beximco Pharmaceuticals Limited was halted, while it remained in place for other subsidiaries.
Reports indicate unrest in multiple Beximco factories over unpaid wages, leading to incidents of vandalism.
Similarly, the mobile banking service "Nagad" under the postal department has witnessed a decline in transactions and stalled decision-making since Bangladesh Bank’s appointment of an administrator.
During Hasina’s administration in 2020, Bangladesh Bank appointed an administrator to Premier Leasing and Finance due to its inability to return depositors’ funds.
Several non-bank financial institutions have faced similar outcomes, prompting depositors to seek redress from higher courts.
The notorious 2011 case, where five entities including Hallmark embezzled Tk3,500 crore from Sonali Bank’s Ruposhi Bangla (Hotel Sheraton) branch, remains unresolved, with Sonali Bank still unable to recover the funds.
In another instance, loan default issues have led to Ennatex Group's decline. Between 2008 and 2014, 22 of its firms were issued massive loans by Janata Bank amidst irregularities, with outstanding dues now totalling Tk6,550 crore excluding accrued interest.
A former Ennatex official disclosed that while their Tongi operations once comprised 22 factories, fire incidents closed two and dwindling funds have reduced operations to four or five active factories.
The owner fled the country prior to 5 August.
Similarly, receivership at e-commerce platform Evaly, imposed by the High Court, has yet to enable the company's recovery or return owed funds to thousands of customers.
Globally, governments have placed businesses under administrative control in cases of alleged corruption and irregularities.
However, this approach has seldom yielded successful outcomes.
For example, China’s anti-corruption crackdown on private sectors in 2020 saw major impacts on top firms such as Alibaba and Tencent, with share values plummeting by 40.4% to 71% during an 18-month regulatory stranglehold.
Bangladesh Bank Governor Dr Ahsan H Mansur emphasised that the receivership at Beximco aims to ensure its continuity rather than cessation: "Beximco was unable to pay workers' wages for several months, necessitating government intervention for payments. Our goal is to keep operations running, not shut businesses down, given their crucial role in employment."
