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US court dismisses Bangladesh suit vs RCBC

/ 04:02 AM March 24, 2020

A US court has dismissed Bang­ladesh Bank’s charges against Yuchengco-led Rizal Commercial Banking Corp. (RCBC) and other entities and individuals in relation to the $81-million cyberhacking and money laundering scam in 2016.

“The case filed by Bangladesh Bank was dismissed for failure to state a federal racketeering claim. The court also declined to exercise jurisdiction over all other state law claims of Bangladesh Bank,” RCBC said in a disclosure to the Philippine Stock Exchange on Monday.

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Bangladesh Bank filed the civil case in early 2019 in order to collect money allegedly lost to North Korean cyberhackers who broke into its systems and sent multiple remittance orders to the account with the Federal Reserve Bank of New York. Some remittance orders were allowed to be transacted through four correspondent banks in New York and were remitted to four bank accounts in RCBC that later turned out to be fictitious.The order dated March 20 issued by the Federal Court of New York granted the motion to dismiss filed by RCBC and three other defendants.

Bloomberry Resorts Corp., the parent firm of Bloomberry Resorts and Hotels Inc. that operates Solaire Resort & Casino, was another defendant in this case.A joint motion by the defendants called for the dismissal of the charges for failure to state a Racketeer Influenced and Corrupt Organizations Act claim.

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After slipping through the cracks at RCBC’s Jupiter branch, part of the money disappeared in Philippine casinos, where these were used to purchase gaming chips and played in the casino and junket rooms. For its part, RCBC tagged the people running the branch in Jupiter Street, led by branch manager Maia Dequito, as “rouge.” Banking regulators slapped RCBC with a P1-billion fine due to the Bangladesh Bank money laundering scandal in 2016.

On Bangladesh Bank’s char­ges, although RCBC believed that the complaint and summons in the United States were “not proper,” the local bank defended itself in court and filed the motion to dismiss the complaint on two grounds: forum non conveniens (that the case belongs in the Philippines) and lack of subject matter jurisdiction (that the federal court does not have authority to hear the case).

Other defendants in the case included Dequito, Lorenzo Tan, Raul Victor Tan, Philrem Service Corp., Salud Bautista, Michael Bautista and Kam Sin Wong. INQ

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TAGS: bangladesh, Business, RCBC
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