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Philippine court finds banker guilty over Bangladesh Bank heist

Dhaka wants Manila to expedite other cases related to one of the biggest cyber-heist in history, involving $81m of theft in 2016.

If we do recalled, in February 2016, Bangladesh Bank was hit by a massive cyber-heist which saw hackers attempting to steal nearly $1bn. Around 35 fake transfer orders from the bank's accounts at the NY Fed were sent via Swift, of which 30 were successfully blocked. However, four transfers for $81m went through to Rizal Commercial Banking Corp (RCBC) in Philippines, while another, a $20m transfer was sent to a Sri Lankan company, which was later reversed as the hackers had misspelled the name of the company.

On 10th January 2019, Nikkei Asian Review reports that a Philippine court found former bank manager of RCBC, Maia Santos-Deguito guilty of money laundering offences on Thursday, in the first criminal conviction related to the 2016 heist of Bangladesh's central bank.

Deguito, was found guilty at a Makati regional trial court of eight charges in connection with the country's largest money laundering transaction. She faces four to seven years in prison for each offence, as well as fines of up to $110 million.

Hackers wired $81 million from Bangladesh Bank's foreign reserve account at the Federal Reserve Bank of New York to four fictitious accounts at the RCBC branch headed by Deguito. The money was then withdrawn, converted into pesos, and laundered in local casinos. Charges were dropped against casino junket operator Kim Wong, who received some of the money, and foreign exchange company Philrem Service. Cases against other RCBC executives, including former Treasurer Raul Tan, are pending at the Department of Justice.

The conviction comes as Bangladesh Bank considers its own legal action in an attempt to retrieve the money. Only around $15 million has been recovered so far. RCBC had been fined a record 1 billion pesos ($52 million).It appears that efforts to date were concentrated in recovery of the monies stolen.

What happened to the hackers? Did the authorities managed to trace and track who the perpetrators are? Maia Santos Deguito is merely a Manager at the recipient bank and she was charged and found guilty of money laundering and NOT the act of hacking or assisted in the attempt.

Would this conviction emboldened more hackers to perpetrate a bigger heist knowing that the law only catches up with those down the chain?


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