Published: Thursday, May 23, 2013

Grameen Bank Commission

Target 48 entities

Target 48 entities

Many legally independent organisations bearing Grameen names are being forced to supply documents to the Grameen Bank Commission although they are not part of the microcredit organisation.
Officials of the organisations said the government-formed commission had recently sent them letters, demanding certified copies of the minutes of the board meetings and the annual audit reports since their inception.
The three-member panel has sent letters to almost all the 48 associated organisations of Grameen Bank, said officials familiar with the development.
The entities that were served with letters include Grameenphone, Grameen Telecom, Grameen Telecom Trust, Grameen Shakti, Grameen Kalyan, Grameen Fund, Grameen Udyog, Grameen Shamogree, Grameen Knitwear and Grameen Danone Foods.
In the case of Grameen Udyog, the commission instructed the organisation to provide by today the certified copies of minutes of the board meetings and annual audit reports.
“Otherwise, legal steps will be taken,” warned the Grameen Bank Commission letter.
In the letter, the commission accused Grameen Udyog of disrupting its investigation by not providing it with information.
Officials of some other organisations have admitted to The Daily Star that they had received similar letters.
All these come as the commission begins inquiring into the organisations with Grameen names to ascertain their legal and financial ties with Grameen Bank and whether they have met the goals they were set up for.
“The commission has been asking for documents repeatedly since the beginning of the year,” a senior official of an organisation told this newspaper, requesting anonymity.
Another official said the commission was using the Commissions of Inquiry Act 1956 in extracting information and documents from the organisations.
“The commission is claiming that these organisations are part of Grameen Bank. So they are asking for information and documents as per terms of references. But we are not part of Grameen Bank. We are legally independent entities,” said the official.
Many associated organisations are already supplying the commission with documents, he added.
Legal experts say the commission cannot extract information, and the way the commission has sent letters to the associated organisations asking for documents amounts to using force.
A senior lawyer familiar with the development said the initial terms of references did not allow the commission to investigate the associated organisations. Later, the terms of references were amended to allow the panel to ask for information and audit reports.
The government formed the commission last year to review the activities of Grameen Bank and the organisations that bear Grameen names and make recommendations on how to run the organisations.
One of the terms of reference of the commission is to review the purpose, legal status and operation of the institutions, companies and enterprises bearing Grameen names.
The commission will also see why they were set up and whether they had served the purpose. It will also identify their legal and financial ties with Grameen Bank.
According to the commission’s interim report, the body will present a scheme for ensuring benefits for Grameen Bank and its borrowers and owners from the operations of the entities.
The scheme will “establish” transparency and accountability in these entities.
The government maintains that the profits and not-for-profits associated organisations are part of Grameen Bank, and any profit from the organisations should go to the bank’s 84 lakh beneficiaries.
But Prof Muhammad Yunus, founder of Grameen Bank, has all along said these are all legally independent entities and he set them up in his personal capacity as part of his lifelong mission to eradicate poverty.
Neither the commission chairman nor its members could be reached for comments.
The holdings of the government and the borrowers of Grameen Bank were 60 percent and 40 percent respectively when the bank was set up in 1983, according to a Grameen Bank Review Committee report published in 2011.
The holding of the borrowers was raised to 75 percent and that of the government came down to 25 percent following an amendment to the Grameen Bank Ordinance in 1986.
The government’s share further came down to below four percent as the government has not subscribed to its holding, the report added.

  • Bongobondho khan

    As if the government have nothing else to do than witch hunting. It would be wise for government and good for the nation if the government puts its time and money on growth and progress.

  • smahmood

    The respected organization is seroiusly in danger by the corrupted government. What is their ultimate aim?

  • Vikram Khan

    Nobody owns the word ‘grameen’, it’s just a Bangladeshi word meaning ‘village’. So there’s no point to start hunting down all ‘grameen’ businesses. It’s clear that the government is desperate to tarnish the good name of professor Yunus, an internationally renowned and rewarded personality, one of the most advanced Bangladeshi thinkers and humanists the country has ever seen.

  • Akm Bari

    After Dr. Yunus established Grameen Bank, Grameen ‘prefix’ became synonym with Grameen Bank. Therefore, anyone use Grameen, people’s perception is that it is part and parcel of Grameen Bank. These inquiries of the Government has nothing to do with Dr. Yunus since he is no longer with the Grameen Bank.

  • Raf Chow

    What is wrong with naming Grameen? There are many companies with similar names and it is ok per law as long as it is not the same. Under company law Grameen Bank and Grameen Phone are totally different. Let’s understand basic commercial codes first. If the word “Grameen” is a registered trademark then there could be legal actions.”Grameen Bank” is a registered name, not
    Grameen.

  • Saleh Tanveer

    Yes, the law does not entitle the government to poke its nose on matters that they do not have any rights on. Grameen entities were established independent of Grameen bank and there is no room for government interference. Today it is Grameen Bank, tomorrow, it will be some one else that government is displeased with. This is like putting a dagger on private initiatives. A larger principle is at stake than Professor Yunus.

  • Iftekhar Hassan

    Big government is always a poison to economic growth. The way hard earn money of the expatriate Bangladeshis and garment workers and Bangladeshi entrepreneurs are being spend to built huge bureaucracy in Bangladesh will backfire. Giving power to lazy and corrupt people of so-called public sector is nothing but disaster. Small and efficient government is the best government. Government must not have any involvement in business. De-nationalise and privatize every public sector corporation and let the enterprising people run the business with low tax. There will always be some corrupt businessmen, that is why you need a strong anti-corruption law and willing to implement it across the land.

  • Iftekhar Hassan

    No, they don’t have to, as long as they have no legal link.

    • Zahir Karna

      “No legal link” is the key point. If there is no legal link, any interaction and sharing of finances, resources, etc. between separate corporations becomes non-transparent and also illegal. That is the reason for investigation, read the article. I wish the writers made this point more clear.

      • Raf Chow

        GB has better Auditing standard than US public companies under SOX. Anyway, all this legal mumbo jumbo is a hog wash because GB needs to be destroyed along with Dr Yunus.

  • Iftekhar Hassan

    I agree with you. This remind me of Jukto Front days of 1954.

  • Saleh Tanveer

    Government may be representatives of people, but they are not entitled to poke into private businesses in the same way they are not entitled to take you and me and put us in prison without any allegations. Yes, indeed, they have absolutely no right to interfere in private businesses.

    • Sabina G

      You must have heard about antitrust suits against Microsoft or Google ? or At&T’s break up by US government ? Dissolving of Arthur Anderson, CPA firm ?

      • Saleh Tanveer

        There are anti-trust laws in the books in the US and there are agencies in the government that bring cases against alleged violators. The government is not allowed to investigate without courts authorizing them to. The bar is much higher for private companies that are do not have public stocks like the Grameen entities created by Yunus (Don’t confuse with Grameen Phone, which is different in that majority shares are controlled by Telenor). Can you kindly point out what is the law under which Grameen entities are being investigated ?

        • Zahir Karna

          From the commission report, all these grameen entities always reported to the Grameen bank board (which is legally a govt. corporation) when Dr. Yunus was in charge . As I understand, GB commission operates under ordinance to investigate management and operations of GB bank. I don’t believe that legally any further law is necessary when: 1. govt. has right to investigate for tax irregularities of any corporation, and there is already due cause for suspicion 2. state ordinance has been created for a public commission

      • Raf Chow

        Again Grameen Bank neither owns nor have direct operational control over all the grameen named organizations –that is the point. The US companies you mentioned were broken up for monopoly which is not the case here. Also AA had nothing to do with the government –it just broke away after Enron scandal.

  • Sabina G

    I know there is no such company as Grameen, I just didn’t want to type the whole name.

    I think the rules you were talking about apply every where , not just in Bangladesh !!

  • Sabina G

    You know you can engage in discussions without resorting to name calling. Aggressiveness doesn’t make one smart !!

    • Raf Chow

      Sure agree. let’s be smart and do something better than Dr Yunus.

      • Raf Chow

        I am not smarter than Dr Yunus , so I follow him with my little knowledge. So the ball already started for me.

  • Raf Chow

    Btb how about Grameen Check popularized by Bibi Russell? Will AL govt. go after her now?. The problem is what AL is doing now may be carried to next level (downward) by BNP if they comeback with vengeance. So how do we do business when government acts like an autocratic regime? Always it starts like this then end with much more devastating effect.

  • Saleh Tanveer

    That’s too much to hope from a commission that has the lawyer arguing for the government against Grameen bank as one of the three members. So much for independence. This is clearly something where the outcome is preset by the leaders of this government.

  • Saleh Tanveer

    Reluctance is easy to understand. One of the three members represented the government in case against Grameen. Also, this is the same commission which declared the 9 representatives of 8 million borrowers not educated enough to hold director positions, never mind that by the same measures most of the MPs and some in the government leadership should be disbarred.

  • Raf Chow

    Every? Not really ..Parliament /House /Senate committee has the right and power to investigate with that power- Facts. What AL is doing is like NAZI when they by passed judicial & legislative branches by forming NAZI goons dominated committees to even try people.