Mon, Apr 25th, 2011 11:18 pm BdST
Reazul Bashar
bdnews24.com senior correspondent
Dhaka, Apr 25 (bdnews24.com)—The Grameen Bank inquiry committee has
caught Muhammd Yunus lying on a number of issues, including his role in
running many Grameen companies.
The committee also concluded the 1996 fund transfer that caused all the
trouble for the Nobel laureate was done without any lawful authority but
admitted that the dispute had indeed been settled, although after a lot
of wrangling, with the Norwegian government.
"A review of minutes of Board meetings shows that decisions on associate
companies of Grameen Bank are taken after deliberations in the meetings.
But Dr Muhammad Yunus told the review committee that these companies had
nothing to do with Grameen Bank," the committee report said.
The five-strong panel was led by Dhaka University economics professor Dr
A K Monaw-war Uddin Ahmad, who specialises in regulatory issues and
teaches international trade.
The committee, formed in January, submitted its report to the government
on Monday. Dr Ahmad's team included central bank deputy governor Nazrul
Huda, former deputy Comptroller and Auditor General Rokeya Deen, former
bank management professor R M Devnath, and Supreme Court lawyer Mohsin
Rashid.
A copy of the full 90-page report, in Bangla, is available with
bdnews24.com.
Not just Yunus, the committee found, "Grameen Bank executives are acting
as directors of 30 companies".
On September 30, 2003, a board meeting gave permission for Yunus to act
as chairman of 20 companies, the report said.
"Until 2003, the Managing Director of Grameen Bank without the
permission of the Board had been acting as Chairman/Director of other
companies of the Grameen family," it said.
"There is no Board approval (yet) for Grameen Bank executives to act as
directors of other companies.
"According to the Grameen Bank Ordinance 1983, setting up of associate
companies such as Grameen Fund and Grameen Kalyan is beyond its
jurisdiction and therefore the Board of the Bank cannot even authorise
the Managing Director and other executives to work as Chairman/Director
of these organisations."
The inquiry also found that Yunus, being an employee of the bank, and
other fellow executives went beyond their authority when they gave
personal guarantees to set up at least 12 limited companies.
A Grameen Bank spokesperson, general manager Jannat-E-Q-Quanine. when
contacted by bdnews24.com at 11pm, declined to comment.
No respect for law
Grameen Bank broke laws in everything it did, according to the inquiry.
"It grew big riding on a country-wide expansion of micro-credit. But in
all the activities—administrative decision-making, procurement, role of
directors in the Board, creation of different companies and
organisations, use of funds, inter-company transfer of funds etc—there
has been a tendency to violate laws and rules in Grameen Bank."
"In fact, the organisation did not follow rules and laws, rather grew
completely dependent on one individual," the report said.
Female directors
The committee found that the much-trumpeted board representation from
among poor borrowers of the bank was all sound and fury, signifying nothing.
"It is also apparent from the proceedings of Board meetings that the
elected female directors of the Grameen Bank do not play any role (in
the deliberations).
"It has been seen that the three government-nominated directors and the
managing director are involved in all activities. The
government-nominated directors form the executive committee. It is
obvious that the elected female directors only attend the meetings.
"There is no relation between the principles and objectives of Grameen
Bank and other associate companies. And it is clear from their (meeting)
deliberations," the report said.
"The full-time managing director of Grameen Bank Dr Muhammad Yunus is a
public servant. But in the Article and Memorandum of Associations of
Grameen Cybernet Ltd and Grameen Babsha Bikash, he has described himself
as businessman.
"In Grameen Trust, he is a professor; and in Grameen Uddog, he
introduces himself as Managing Director of Grameen Bank. In Grameen
Textiles Mills Ltd Memorandum and Article, his address is Medical
College Road, Panchlaish, Chittagong (not the usual address of Grameen
Bank Complex)."
Fund transfer 'ultra vires'
The committee said that Grameen Bank indeed stepped beyond its legal
authority to divert billions of takas of aid money to another arm of the
Grameen family in 1996.
It said that a 'credit account' was created in Grameen Kalyan by
transferring the fund in the organisation to make the fund interest bearing.
"It seems that the dispute regarding use/transfer of Norad aid funds for
Grameen Bank has been settled. But the fund transfer to different
organisations by Grameen Bank was beyond its authority (ultra vires),"
the report said.
"Grameen Bank, from its revolving fund received from (Norwegian aid
agency) Norad and other donors, transferred Tk 3.47 billion (Tk 347.18
crore) to Grameen Kalyan.
"The bank in its balance sheet made revolving fund account debit and
'borrowing from Grameen Kalyan' account credit meaning it decreased
equity and increased liabilities," the inquiry found.
"By doing so, the ownership of the fund was transferred. It can be
considered as aid as no liabilities were incurred from Grameen Kalyan.
Revolving fund should be used by Grameen Bank repeatedly," the report said.
"Besides, fund transfer issue was not mentioned in the agreement between
Norad and the Bangladesh government. It means the action (fund transfer)
of Grameen Bank was ultra vires. As a result, the objection raised by
Norad on 15 December, 1997 seems logical."
"Grameen Bank sent a letter to Norwegian embassy on 8 January, 1998 and
clarified that if the fund was managed by other organisations then
efficiency would be increased, accounts of revolving fund would be
properly utilised and it would reduce the tax burden."
But, the committee said, it was not within the legal authority of
Grameen Bank to transfer fund without the permission of donors on the
excuse of reducing tax burden.
bdnews24.com/rb/nir/2315h.
***
Grameen fund transfer 'ultra vires': inquiry
Mon, Apr 25th, 2011 8:52 pm BdST
Dial 2000 from your GP mobile for latest news
Reazul Bashar
Dhaka, Apr 25 (bdnews24.com)—Grameen Bank stepped beyond its legal
authority to divert fund to another arm of the Grameen family in 1996,
says an inquiry by top professionals.
The five-member fact-finding committee, formed in January, on Grameen
Bank submitted its report on Monday. The inquiry was led by Dhaka
University economics professor Dr A K Monaw-war Uddin Ahmad, who
specialises in regulatory issues and teaches international trade.
The committee said that a 'credit account' was created in Grameen Kalyan
by transferring the fund in the organsiation to make the fund
interest-bearing.
"It seems that the dispute regarding use/transfer of Norad aid funds for
Grameen Bank has been settled. But the fund transfer to different
organisations by Grameen Bank was beyond its authority (ultra vires),"
the report said, a copy of which is available with bdnews24.com.
"Grameen Bank, from its revolving fund received from Norad and other
donors, transferred Tk 3.47 billion (Tk 347.18 crore) to Grameen Kalyan.
"The bank in its balance sheet made revolving fund account debit and
'borrowing from Grameen Kalyan' account credit, meaning it decreased
equity and increased liabilities," the inquiry found.
"By doing so, the ownership of the fund was transferred. It can be
considered as aid, since no liabilities or return was incurred by
Grameen Kalyan. Revolving fund should be used by Grameen Bank
repeatedly," the report added.
"Besides, fund transfer issue was not mentioned in the agreement between
Norad and Bangladesh government. It means the action (fund transfer) of
Grameen Bank was ultra vires. As a result, the objection raised by Norad
on 15 December, 1997 seems logical."
"Grameen Bank sent a letter to Norwegian embassy on January 8, 1998 and
clarified that if the fund was managed by other organisations then
efficiency would be increased, accounts of revolving fund would be
properly utilised and it would reduce the tax burden."
But the committee said it was not within the legal authority of Grameen
Bank to transfer fund without the permission of donors on the excuse of
reducing tax burden.
Dr Ahmad's team included central bank deputy governor Nazrul Huda,
former deputy Comptroller and Auditor General Rokeya Deen, former bank
management professor R M Devnath, and Supreme Court lawyer Mohsin Rashid.
bdnews24.com/rb/ssz/bd/2039h
***
Fund transfer draws 'distinguished' flak
Tue, Apr 26th, 2011 2:56 am BdST
Dhaka, Apr 25 (bdnews24.com) — There were financial irregularities and
serious violation of law while transferring funds from Grameen Bank to
Grameen Kalyan in 1996, some distinguished people have told an inquiry
committee.
Formed in January, the five-member fact-finding committee—comprising top
professionals—submitted its report on Monday.
According to the report, the distinguished people asked to give opinion
on the bank, said, "There was serious violation of law and Grameen
Bank's interest was harmed when the fund, obtained on account of the
bank's goodwill, was transferred to another entity of the Grameen family."
They said borrowers were being harassed in the name of loan recovery.
Many families got ruined due to their failure to repay, while many
committed suicide.
The distinguished people contacted by review panel include Dr Mohammed
Farashuddin, former governor of Bangladesh Bank, Dr S R Omani, professor
of economics department of Ulster University of the UK, Dr Selim Rashid,
professor of economics department of Illinois University of the US, Dr
Syed Moyeenul Ahsan, professor of the economics department of Concordia
University of Canada, Khandaker Mozammel Haque, chairman of Grameen
Bank, Muhammad Khaled Shams, former deputy managing director of the
bank, Noorjahan Begum, deputy managing director of the bank, M M Akash,
professor of economics department of Dhaka University and Dr Muhammad
Yunus himself.
They also expressed their doubt over the bank's role in women's empowerment.
Norway's national TV NRK aired a documentary on November 30 last year,
titled "Fanget i Mikrogjeld" or "Caught in Micro Debt", based on which
bdnews24.com ran a report on December 1, 2010.
According to the documentary, Yunus transferred the aid money to Grameen
Kalyan, which was in no way involved with microcredit operations.
bdnews24.com was the first media outlet in the country to break the news.
bdnews24.com/si/pd/ost/nir/2345h
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Received on Wed Apr 27 07:38:50 2011
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