ACC's letter sent to Biman's MD and CEOACC seeks info from Biman to investigate 1,076C contract irregularities

The Anti-Corruption Commission (ACC) has formed a four-member committee to investigate allegations of irregularities amounting to Tk 1,076 crore in fraudulent contracts related to the purchase of various services, including control of trading on the online platform of Biman Bangladesh Airlines.

The national watchdog formed the committee, led by Commission Deputy Director Anarul Haque, Deputy Director Zesmin Akter, Assistant Director Abul Kalam Azad, and Sajjad Hossain.

On Monday, the commission sent a letter to the Biman Managing Director and CEO requesting all relevant information, including a copy of the Sabre GLBL Inc passenger service system contract and details of other service providers, such as the global distribution system (GDS), contractor DPP, approved estimates, allocation of funds, copies of advertisements in newspapers, the market price verification committee report, tender selection committee list, recommendations from the financial and technical committee, tender evaluation committee report, notification of award, work order, copies of pre-contract and post-contract financial proposals, the contract amount, and a copy of the minutes from the 257th Biman board meeting.

The commission also requested a copy of the report from the Office of the Comptroller and Auditor General (OCAG).

How was the money lost?

According to the OCAG report, Biman Bangladesh Airlines is facing significant financial losses due to allegedly fraudulent contracts related to the purchase of various services, including control of ticketing on its online platform. Over 10 years, these losses will amount to Tk 1,076 crore.

The audit report indicates that pre-agreement financial proposals understated costs for some services and concealed costs for others. Additionally, some service charges were included in the contract without being reflected in the financial proposal.

It is alleged that several officials, including a current director of Biman, were involved in this manipulation.

In September 2021, Biman entered into a 10-year agreement with Sabre GLBL Inc., a software and technology services provider. According to the agreement, the technology used by agents for booking and selling tickets includes the Global Distribution System (GDS), the Passenger Service System (PSS) related to airline ticket sales, the Departure Control System (DCS) for airport check-in and boarding card management, and other services such as e-commerce and loyalty services.

Before this deal, Biman's Board of Directors projected that the company would need to pay Tk282 crore over 10 years for these services. The Board of Directors approved the agreement based on this estimate.

However, a recently completed audit revealed that the deal was structured in such a way that Biman would actually have to pay a total of Tk 1,358 crore over 10 years for these services, which is Tk 1,076 crore more than the amount approved by the Board of Directors.