Bangladesh Bank Heist: New York Supreme Court Tosses Case Against Bloomberry

Posted on: April 12, 2022, 07:52h. 

Last updated on: April 13, 2022, 09:50h.

Philip Conneller @casinoorgphilc Read More
Expertise: Gaming Business, Regulation, Tribal Gaming.

A New York state court has dismissed a lawsuit that sought to hold Bloomberry Resorts liable for millions still missing from the 2016 Bangladesh Bank heist.

Solaire
The Solaire Resort and Casino in Parañaque, Manila, where around $29 million from the Bangladesh Bank heist was laundered. (Image: Bloomberry Resorts)

The Philippine casino operator said Monday the civil case brought by the Bangladesh Bank had been dismissed in the New York Supreme Court for lack of jurisdiction.

The case is part of the bank’s efforts to recoup $81 million stolen by hackers believed to have links to the North Korean regime.

The money was diverted from the New York Federal Reserve to the Philippine banking system and then laundered through that country’s loosely regulated casino sector. Around $29 million ended up at Bloomberry’s Solaire Resort in Manila.

Bloomberry ‘a Victim’

Bloomberry’s lawyers argue the resort was not complicit in the robbery and was a victim of criminals who laundered the cash at its gaming tables.

The Bangladesh Bank initially sued the operator in a federal court in New York in January 2019 under the anti-racketeering RICO Act. But the judge, in that case, ruled the plaintiff had “failed to state a RICO claim or RICO conspiracy claim.” Also named in the later suit was the Rizal Commercial Banking Corp (RCBC), one of the Philippines’ biggest banks, which played a role in moving the money.

It claimed “conversion/theft/misappropriation; aiding and abetting the same; conspiracy to commit the same; fraud (against RCBC); aiding and abetting and conspiracy to commit fraud; conspiracy to commit trespass against chattels; unjust enrichment; and return of money received.”

$1B Targeted

In February 2016, hackers flooded the New York Fed with 35 requests to transfer nearly $1 billion from an account used by the Bangladesh government for international settlements. They had earlier introduced malware into the Bangladesh Bank’s servers, which gave them access to security credentials.

Five transactions totaling around $101 million were processed before New York Fed employees became suspicious and blocked the rest. Around $20 million was traced to Sri Lanka and recovered. The rest ended up in five RCBC accounts that had been opened a month earlier under false names.

This money was consolidated into one account and transferred by RCBC branch manager Maia Deguito to currency exchange Philrem, where it was converted into Philippine pesos and distributed to casino VIP rooms.

Philippine authorities believe two high-rolling Chinese junket operators, Gao Shuhua and Ding Zhize, opened the fictitious bank accounts with the help of Deguito and laundered much of the money through Solaire.

Gao and Ding’s whereabouts are unknown. In 2019, Deguito was sentenced to four to seven years in prison and fined over $100 million for her role in the heist. She is the only person to have been prosecuted for the crime.