Yunus siphoned Tk 7bln: TV report
bdnews24.com Europe Correspondent, and Biswadip Das
Dhaka, Dec 1 (bdnews24.com)—Nobel laureate Muhammad Yunus siphoned off
nearly Tk 7 billion (100 million dollars) in aid from Grameen Bank to
his own company back in 1996, the Norwegian TV says in startling
revelation.
An investigative foreign TV documentary "Fanget i Mikrogjeld" or
"Caught in Micro debt" aired on Tuesday on the National Norwegian
Television, NRK shows 'the banker to the poor' transferred the money,
meant for poor, to Grameen Kalyan, which was in no way involved with
micro-credit operations.
The film, premiered on Tuesday, quotes Professor Jonathan Morduch from
New York University saying that Grameen Bank, which also won the Nobel
Peace prize alongside Yunus, received $ 175 million dollars in
subsidies to give tiny loans to mini entrepreneurs.
The numerous secret documents, which have never been published before
and some of which are available on the bdnews24.com website, reveal
Yunus breached the agreement on housing loans. And when the Norway
Embassy, Norwegian aid agency Norad and the Economic Relations
Division in Bangladesh pressured him to return the money to Grameen
Bank, he gave back less than some Tk 2 billion ($ 30 million).
He then desperately did not want the story out and wrote a personal
letter on April 1, 1998 to the then CEO of Norad requesting help. "If
the people, within and outside government, who are not supportive of
Grameen, get hold of this letter we'll face real problems in
Bangladesh," he pleaded.
"And Norad, the Norwegian Embassy and the Bangladeshi authorities kept
their mouths shut," the documentary says. The money was from foreign
grants from countries such as Norway, Sweden, The Netherlands and
Germany, and the transaction took place at the end of 1996.
In the mid- and late-1990's, foreign aid and grants filled the bank
account of Grameen Bank, according to the programme directed by Tom
Heinemann, a Danish award-winning journalist, who spoke to
bdnews24.com that has obtained some documents.
Heinemann, the director, told bdnews24.com after the premiere that he
attempted to look critically into micro finance and came to know the
things.
"I have tried to talk to Mr Yunus for six months. But he didn't want
to talk to me," he said over telephone early on Wednesday.
In one of the many documents dated Jan 8, 1998, Yunus explained why he
did the transaction. 'With gradual higher interest rate charged, (...)
more and more money will have to be paid out as taxes in future," he
wrote to the Norwegian Embassy in Bangladesh.
WHY AGREEMENT?
The Norwegian Embassy in Dhaka at a meeting with the bank at its
office on Dec 3, 1997 came to know about the agreement between Grameen
Bank and Grameen Kalyan, signed on May 7, 1997 and became effective on
Dec 31, 1996 for transfer of funds of Tk 3.914 billion.
In a letter to Yunus on Dec 15, 1997 the embassy said: "In line with
the agreement, Grameen Bank transferred all funds accumulated up to
Dec 31, 1996 received from donors for revolving funds, to Grameen
Kalyan, which at the same date transferred the same amount to Grameen
Bank as a loan.
Tk 1.927 billion of the amount was related to the revolving fund for
housing loans.
The letter undersigned by ambassador Hans Fredrik Lehne said: "The
agreement concerning these transactions has not made provisions for
any interest rates to be charged for this part of the loan, nor any
terms of repayment."
According to the agreement signed between the governments of Norway
and Bangladesh on Nov 30, 1994 to support Grameen Bank's Phase IV
project.
Annex 1, clause 4 of the agreement said: "The amount of the Grant used
for housing loans will be used as a revolving fund."
The Norwegian Embassy was concerned about the agreement between the
two organisations for not informing it, saying "the agreement was
contrary to the quoted clause of the agreement between the
governments."
It also observed that the accounts of Grameen Bank as of Dec 31, 1996
did not reflect any revolving fund for housing loan in operation under
the bank.
The embassy, which accepted the ownership of Grameen Bank, pointed
that "the ownership of Grameen Kalyan is of another nature, and Norway
has not entered into an agreement with Bangladesh to provide funds to
Grameen Kalyan for onlending to Grameen Bank."
"The agreement has further left uncertainty about future repayment of
the loan to Grameen Kalyan, since it is not regulated by the
agreement.
"The agreement is also silent about Grameen Bank's use of the loan
from Grameen Kalyan."
The embassy in that consequence considered the agreement between
Grameen Bank and Grameen Kalyan "as a change which affects two
agreements between the two governments to support Grameen Bank."
It also asked for a written explanation from Yunus "why Grameen Bank
entered into the agreement with Grameen Kalyan, and of the
consequences for the owners of Grameen Bank and the beneficiaries of
the housing loans."
PAY BACK
The film crew also travelled several times to Bangladesh and visited
some of the most significant villages in the history of Grameen Bank.
Says Heinemann: "In Jobra, we meet the daughter of the famous original
loan taker, Sufiya Begun. In "Hillary Village", where the former first
lady of the USA, Hillary Clinton declared her support for both
Mohammad Yunus and Grameen Bank, the crew meets poor people who have
gained nothing but more debt due to micro credit."
"Almost all of the loan takers interviewed told the same story. Each
one had multiple loans in various micro credit banks and organisations
and had had a hard time trying to pay back their loans. Some had sold
their house, others had their tin-sheets pulled off their houses to
cover the weekly payments."
The film also interviews a number of leading social scientists and
researchers who, for years, have questioned the "big success" of
microcredit. "In fact, renowned social scientists, such as David
Roodman, Jonathan Morduch, Thomas Dichter and Milford Bateman, agree
on one thing: After 35 years of Microcredit there is no evidence that
Microcredit lifts millions out of poverty."
The Norwegian version of the film will soon be followed by an
international version which will also contain interviews from the
Indian state of Andhra Pradesh, where numerous reports of suicides
amongst loan takers have spread around the world and have questioned
the benefits from microcredit.
Yunus, the darling of the western media credited with pioneering the
global microlending revolution, in his defence, says nine women on the
board of Grameen represent borrowers. But his detractors say he does
things his own way.
Critics put the stunning loan recovery rate of nearly 98 percent down
to, as villagers complain, the harassment from the debt collectors.
Some argue that people can quickly sink into a cycle of debt, with
many lenders charging exorbitant rates of interest.
Dr Qazi Kholiquzzaman Ahmad, chairman of PKSF, a body that monitors
microfinance, describes microcredit as a "death trap" for the poor.
In December 2006, a few days before receiving the Nobel Peace Prize in
Oslo, he publicly attacked Norwegian telecoms giants Telenor, the
majority owner of grameenphone.
He accused it of 'breaching the contract and depriving Grameen Bank of
grameenphone's management control. He said he believed Telenor was
sucking profits from the poor of Bangladesh.
http://bdnews24.com/details.php?id=180277&cid=2
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