[chottala.com] Grameen Bank & Transperancy ?

For the sake of transparancy Dr. Yunus should disclose his personal

financial data and reveal his fortunes in Bangladesh and in USA.

 

Proverty-trading is a big business ... Can he disprove that ?

 

A Rahim Azad

 

 On Sun, Mar 6, 2011 at 12:45 AM, <sayfaldin@aol.com> wrote:

 

Here are the facts from the Bangladesh Government's side on the Mohammed Yunus and Grameen Bank issue:

 

Last year Norwegian Television uncovered documents revealing massive financial improprieties at Grameen Bank under Mohammed Yunus. Approximately US $100 million in donor funds to Grameen Bank were transferred out of Grameen Bank to a private corporation, Grameen Kalyan set up by Yunus. The Government of Norway raised this as a major concern and as a compromise $30 million was returned. The remaining approximately $70 million was never returned. All correspondence in this regard was from Yunus himself.

 

You can download a copy of the letters from the BDNews24.com website at http://av.bdnews24.com/file/all/Yunus.pdf. I have also attached a translation of Norwegian Television's response to the Norwegian Government's recent review of this incident where the Norwegian Government cleared Grameen Bank of any wrongdoing. The original is available in Norwegian on their website http://www.nrk.no/programmer/tv/brennpunkt/1.7419927. Just as international lobbying and media is being used in this recent incident, no doubt Yunus lobbied the Norwegian Government as well. However, their explanation left millions of dollars unaccounted for.

 

This became a major issue in Bangladesh and the Government was forced to form an independent committee to investigate. Yunus personally gave a press statement (no questions were allowed) where he announced that he undertook these transfers to avoid taxes, which constitutes tax evasion. However, this makes no sense since Grameen was at the time a nonprofit and paid no taxes. What is clear is that this transfer is completely illegal and constitutes a criminal offence of "conversion" under Bangladesh law.

 

Further investigation uncovered other fraud, improprieties and illegal activity at Grameen Bank under Yunus. These include:

 

1.       Between 1998 and 2002 all microloan borrowers were forced to pay an additional amount labeled "forced savings" which they were supposed to be paid back. However, this money was never returned to the borrowers, who are among the poorest of society! This is fraud and theft.

2.       Donor funds were used to invest in a variety of private sector for profit ventures, all without approval from either the donors or the Government, which owns 25% of Grameen Bank. In several cases, the equity in these private ventures was held not by Grameen Bank, but by Yunus and his family members personally. This is completely illegal and constitutes embezzlement.

3.       Loans were made by Grameen Bank to some of these corporations, which is completely illegal since Grameen Bank is not a regular bank. It is lending donor funds and is only allowed to loan to microcredit borrowers.

4.       Grameen Bank charges up to 30% in interest rate on loans and up to an additional 10% in "forced savings" to the poorest sections of society. Their collection methods are draconian and collection officers who fail to collect payment have the uncollected amounts deducted from their pay. There are many documented cases which constitute abuse and the criminal offence of "molestation" under Bangladesh law. Since the financial improprieties surfaced in the media, some of these victims finally gained the confidence to sue Grameen Bank and Yunus in court. He is facing several lawsuits in this regard.

 

There are several other legal issues concerning Grameen Bank. I have attached a brief from the lawyers of the Government of Bangladesh that detail them. I have also attached a brief that explains Grameen's legal status in Bangladesh. Contrary to the popular perception, Yunus did not found Grameen Bank. The Government of Bangladesh did. Initially the Government owned 65% of Grameen Bank, which was whittled down over the years by Yunus. The Government still owns 25% of Grameen Bank and retains the right to veto management appointees.

 

Despite the hype, there is no evidence that microcredit has in fact reduced the rolls of the poor in Bangladesh. Grameen Bank has been in the microcredit business for 30 years, yet Bangladesh remains one of the poorest countries in the world. Furthermore, the private sector investments made using Grameen Bank money have become quite profitable. Grameen Phone is by far the largest telecommunications operator in Bangladesh with a subscriber base of 28 million, annual revenue of over US $1 billion and profits of several hundred million dollars per year. Grameen Bank owns 35% equity in Grameen Phone, so why do they have to charge such high interest rates to the poor?

 

Still, given his stature as a Nobel Prize winner, the Government of Bangladesh requested that Yunus step down quietly from the post of Managing Director of Grameen Bank. He refused and has engaged in an international lobbying campaign accusing our Government and in particular, Prime Minister Sheikh Hasina of engaging in political retribution. Nothing could be further from the truth. Yunus has no political stature in Bangladesh. During the brief military regime from 2007-08, under a state of emergency with all political activity banned and most political leaders behind bars, even with the help of the military he was unable to put together a political party and garner any public support. Politically he is a non-entity in Bangladesh and no threat to any political leader.

 

Finally, please note that the Government of Bangladesh has not filed any cases against Yunus, criminal or otherwise. There is absolutely no punitive action here. Our only goal is to prevent further abuse of microcredit borrowers.

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