Hackers are likely to get away with about $70 million of Bangladeshâ€™s foreign reserves after a brazen cyber-attack against the South Asian nation, according to Finance Minister Abul Maal Abdul Muhith.
The Philippines â€” where most of the funds ended up â€” will probably recover as much as $10 million of the $81 million stolen in February from Bangladeshâ€™s account at the Federal Reserve Bank of New York, Muhith said. The rest is hard to track, he said.
â€œThe way it has been lost, itâ€™s very difficult to identify the beneficiaries,â€ Muhith said by phone from Dhaka. â€œIt has gone largely into casinos and casino accounts.â€
The attempted theft of almost $1 billion has prompted central banks around the globe to review defenses against hackers looking to loot bountiful foreign reserve accounts. While the Fed blocked most of the transfers, about $81 million ended up in the Philippines. Another $20 million sent to a bank in Sri Lanka was returned.
The Philippines is investigating the heist. Muhith said Bangladesh is also conducting a probe, adding that â€œdefinitely some of our people mustâ€™ve been involved.â€ He declined to disclose further details.
Muhith repeated criticism of the NY Fedâ€™s handling of the money transfers, saying it allowed four transactions to go through without confirmation.
â€œThat way they become liable for that part of the fraud,â€ Muhith said, referring to the NY Fed. â€œThere have been security lapses and the Federal Reserve cannot be excused for some blame in this trouble.â€
The Fed said last month that instructions to make the payments from the account of Bangladeshâ€™s central bank followed standard protocols and were authenticated by the SWIFT message system used by financial institutions.
Bangladeshâ€™s security systems are â€œvery vulnerableâ€ and consultants are working on improving defenses, Muhith said. A detailed report on the investigation will be completed in about six weeks, he said.
Bangladeshâ€™s foreign reserves climbed to a record $29 billion this year as a weaker yuan cut the cost of raw materials used in its garment industry. Exports are holding up despite the drop in global demand, Muhith said.
He called the crime â€œa very unusual event,â€ adding that the world hasnâ€™t seen anything like it in recent memory. â€œItâ€™s a large sum of money for Bangladesh,â€ Muhith said. â€œThis is a very good warning, a signal to the world to take proper security measures in respect to money transfers.â€