The Bangladesh Bank has formally established a high-level investigative committee to conduct a comprehensive audit of recruitment procedures and subsequent staff redundancies at six prominent Shariah-based commercial banks. Led by an Executive Director of the central bank, the seven-member panel is mandated to evaluate the legal standing of thousands of appointments made over recent years, alongside the validity of large-scale dismissals initiated following the political transition on 5 August 2024.
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Scope of the Regulatory Audit
The investigation focuses on a specific cohort of financial institutions that operated under the de facto control of the S. Alam Group prior to the recent change in administration. The banks under scrutiny are:
Islami Bank Bangladesh PLC
Social Islami Bank PLC
First Security Islami Bank PLC
Al-Arafah Islami Bank PLC
Union Bank PLC
Global Islami Bank PLC
The primary objective of the committee is to ascertain whether the thousands of personnel recruited during the period of S. Alam Group’s influence were appointed through transparent, meritocratic, and competitive procedures. Simultaneously, the panel will scrutinise the justifications provided by the current management of these institutions for the recent termination of employment contracts and forced resignations.
Allegations of Procedural Irregularity and Mass Dismissals
The formation of this committee follows a period of escalating unrest within the banking sector. Displaced employees claim that approximately 10,000 officers and staff members have been relieved of their duties since 5 August 2024. Protesters argue that these redundancies were executed summarily, without the provision of specific cause, formal warnings, or the requisite notice periods stipulated in employment law.
On 19 April, several thousand former employees organised a human chain demonstration in front of the Bangladesh Bank headquarters in Motijheel. The demonstrators characterised the current “cleansing operation” within the Islamic banking sector as discriminatory and a direct violation of standard labour laws and internal service rules. They have formally petitioned the central bank for immediate reinstatement, asserting that they have been unfairly targeted purely based on the timeframe of their initial recruitment.
Management Defence and Institutional Integrity
In contrast, the current administrations of the six banks maintain that the dismissals are a vital corrective measure intended to address deep-seated systemic corruption in human resources. Management sources allege that between 2017 and 2024, standard recruitment protocols were bypassed to accommodate political appointees and individuals linked to the S. Alam Group.
The committee’s investigation will specifically examine the following allegations:
Absence of Competitive Selection: Claims that thousands of individuals were hired without the publication of job advertisements or the conduct of competitive written and oral examinations.
Regional Favouritism: Assertions that the banks were disproportionately staffed with candidates from a specific district in Chittagong, regardless of their professional qualifications or technical competence.
Verification of Credentials: Internal audits have reportedly identified cases where employees secured positions using forged academic certificates or misrepresented credentials.
Technical Incompetence: Reports suggest that a significant number of recruits failed to pass basic internal competency evaluations but were retained on the payroll due to external political pressure.
Committee Mandate and Administrative Stability
The seven-member committee has been directed to conduct a meticulous audit of the human resource files and recruitment documentation of the affected institutions. A comprehensive report is expected to be submitted within the coming weeks. The findings within this report will serve as the definitive evidence base for the Bangladesh Bank’s subsequent regulatory directives.
Should the committee determine that specific dismissals violated established labour protocols, those employees may be considered for reinstatement. Conversely, if the investigation confirms that the original appointments were fraudulent or lacked legal standing, the terminations will be upheld. Currently, the initiation of this probe has resulted in a degree of administrative instability within the six banks, as both incumbent staff and those seeking reinstatement await a final resolution. This intervention is viewed as a critical step by the central bank to restore corporate governance and public confidence in the nation’s Shariah-based financial sector.