Bangladesh-Malaysia labour route rife with corruption

Endemic corruption in the Bangladesh–Malaysia migrant worker system is enriching a powerful few while trapping migrants in a punishing economy of exploitation, Bloomberg reported in an investigative piece published yesterday.

Titled “Everyone gets a cut, and migrant workers pay the price,” the months-long investigation describes a recruitment system manipulated by businesses linked to political elites. 

The report opens with the story of Shofiqul Islam, who borrowed to pay $4,400 for a construction job in Malaysia. The job never materialised, his employer vanished, and his visa expired, leaving him stranded in a derelict building outside Kuala Lumpur. Shofiqul died there in February 2024.

He is one of more than 800,000 Bangladeshis who have gone to Malaysia over the past decade, often sinking into debt to pay recruitment fees far higher than those charged to workers from other countries, sometimes for jobs that do not exist.

Bloomberg interviewed more than 100 people, including current and former officials, labour analysts, recruiters and migrants, and found a system shaped by entrenched corruption, designed to extract as much money as possible from desperate workers, often leading to debt bondage, forced labour and human trafficking.

More than a dozen interviewees said figures in Malaysia’s ruling elite, including at the highest levels of government, are aware of the abuses but do little to stop them because recruitment fees benefit everyone involved.

A representative for Malaysian Prime Minister Anwar Ibrahim referred Bloomberg to the Ministry of Home Affairs, which did not respond. Bangladesh’s government also declined to comment.

AMIN’S BESTINET 

Malaysia has recruited Bangladeshi workers since the 1980s, with unofficial payments long embedded in the process. But costs surged after a man from Bangladesh rose to prominence: Aminul Islam, known as Amin, reported Bloomberg.

A controversial member of Malaysia’s elite, Amin told Bloomberg in his first interview last July that he has spent his career helping migrant workers and denied responsibility for their hardships.

Companies he founded have generated more than $100 million in profits over the past decade, filings show. Amin declined to comment on his personal wealth.

After migrating from Bangladesh in 1988, Amin built businesses providing housing and transport for workers before moving into recruitment. In 2008, he founded Bestinet, a company offering software to digitise Malaysia’s recruitment system, pitching it as a tool to curb corruption.

Some officials were sceptical. The International Labour Organization reviewed the system in 2013, calling it innovative but warning it was not “fool-proof in protecting migrants from excessive fees.” Malaysia adopted the system two years later.

People who know Amin said he cultivated powerful allies, including former senior officials and an influential politician, Ahmad Zahid Hamidi. When Bestinet was adopted in 2015, Zahid was home affairs minister overseeing immigration and announced Malaysia would recruit up to 1.5 million Bangladeshi workers.

But all recruitment was routed through just 10 Bangladeshi agencies out of more than 1,000, ending open competition. Three former Bangladeshi officials told Bloomberg that Malaysia imposed the arrangement, warning it would recruit from elsewhere if Dhaka refused.

Six people said Amin selected the agencies while Zahid handled the politics, according to the report. A parliamentary committee later found the ministry issued Bestinet a letter of acceptance before finalising procurement terms.

Zahid has denied involvement, and Amin said Malaysia chose the agencies and that he is not Zahid’s friend.

Agencies excluded from the list sued in 2018, calling the arrangement a cartel designed to control recruitment costs. The suit alleged the firms were not selected on merit and that Amin helped design the scheme. The case was later withdrawn without findings of wrongdoing.

Citing interviews, official letters and witness statements, Bloomberg reports that the selected agencies began charging workers an unlawful “syndicate fee” of about $1,350. Without cash payment, workers were allegedly denied their passports.

Ruhul Amin, owner of Dhaka-based Catharsis International, was accused by agents of collecting these fees, which allegedly exceeded $1 billion over a decade. If agencies failed to pay, Bestinet’s system allegedly blocked new recruitment orders.

These and other charges pushed recruitment costs as high as $6,600 per worker, according to a 2024 memo prepared for Anwar -- more than double previous levels and far higher than fees paid by Indonesian or Nepali workers, according to the report.

Amin denied the existence of syndicate fees. “I never met a single worker, so how do I collect money?” he told Bloomberg.

Three agencies denied collecting unlawful fees, including Catharsis, which said it operates ethically. Others did not respond.

It remains unclear how many workers paid the fees or where the money went. There is no evidence it went to Amin. 

But in 2024, Bangladesh arrested dozens of recruitment agents on charges of money laundering, extortion and trafficking, and asked Malaysia to stop using Bestinet and extradite Amin and Ruhul.

Bangladesh’s Interpol office accused the pair of playing key roles in a system that “fraudulently extorted money” and caused workers “physical and mental torture”.

Amin denied the allegations. Malaysia’s home affairs minister said police in both countries are in contact, but Amin has not been extradited.

Latheefa Koya, former chief of Malaysia’s Anti-Corruption Commission, described Amin as a symptom of deeper institutional rot. She and other senior officials said recruitment has become so lucrative that companies over-recruit or promise fake jobs to illegally subcontract workers.

The fees sustain the system, they said. Everyone gets a cut and the workers pay.