Wednesday, March 16, 2016

Norway clears Grameen Bank of misusing funds

New Age, 9 December, 2010

Norway clears Grameen Bank of misusing funds
David Bergman 
The Norwegian government has cleared the Grameen Bank of misusing any of the Tk 754 million (NOK 170m) that it had given the bank between 1985 and 1996.
Erik Solheim, the Norwegian minister of the environment and international development, said in a press release on Tuesday , ‘According to the report, there is no indication that Norwegian funds have been used for unintended purposes, or that Grameen Bank has engaged in corrupt practices or embezzled funds.’
The allegation that money had been misused by the Grameen bank was first made in a documentary broadcast by the Norwegian Television station, NRK.
Made by the documentary’s director Tom Heinneman, it claimed that money had ‘disappeared’ from the bank.
Specifically, it alleged that Tk 243 million (NOK 50m) of Norwegian donations had been given to finance Grameenphone.
The allegations were then repeated by under a headline stating that Yunus ‘siphoned Tk 7bn aid for poor.’
The article on the news web site, which was widely published in Bangladesh, also claimed that Yunus had taken from the Grameen Bank $70 million, two-thirds of Norad’s donations.
Norad’s inquiry report, undertaken on the request of the international development minister, finds that none of these allegations were accurate.
The report explains that Norad had given Tk 754 million (NOK 170m) to the Grameen Bank for providing loans to the poor. This was part of a bigger package of donations from other donors that totalled Tk 3472 million (NOK 540m).
In December 1997, the embassy found out that the Grameen Bank had transferred all this money to a company called Grameen Kalyan.
The report said the donor money was then loaned back to the Grameen Bank to be used ‘for the same purposes as the original intention set out in the [donor] agreement.’
The Norwegian government objected to this arrangement and remained un-persuaded by Grameen Bank arguments that it would help reduce the bank’s possible future tax liability.
The report said that after a series of discussions, ‘the Embassy secured agreement to a full return of the revolving loan funds.’ This means that all of the Norad money, Tk 754 million (NOK 170m) returned into the ownership of the Grameen Bank.
The report then quoted the statement made by Grammen: ‘Afterwards not only Norad’s money, but the 100 per cent of all donor’s money to the extent of Taka 3,474 million 501 thousand was “transferred back” from Grameen Kalyan to Grameen Bank….’
In relation to the alleged use of donor money for funding the Grameen Phone, the report said, ‘Norwegian aid funds… were not used to fund Grameen Telecom.’
Instead this money had come from a fund called the Social Advancement Fund which was created internally through the Grameen Bank.
Toufique Khalidi, chief editor of the, told New Age, ‘Norad’s report neither contradicts the Norwegian TV documentary, nor does it refute anything in our report. It rather corroborates what we have reported.’
Tom Heinneman, the Danish director of the Norwegian documentary, said that he was too busy to comment on the report.

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