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Bangladesh probe clears Yunus of misusing aid

Bangladesh probe clears Yunus of misusing aid
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First Published: Mon, Apr 25 2011. 06 54 PM IST
Updated: Mon, Apr 25 2011. 06 54 PM IST
Dhaka: A Bangladeshi probe has cleared Nobel laureate Muhammad Yunus of misappropriating Norwegian aid money at the pioneering microfinance bank he founded, the country’s finance minister announced Monday.
But the bank is still awaiting a final decision on a separate government claim that Yunus was illegally reappointed managing director, with the Supreme Court due to review an order for his dismissal next month.
Yunus has been under fire since last December when a Norwegian documentary claimed $96 million of aid had been diverted in 1996 from Grameen Bank, which provides small loans to the poor, to other parts of Grameen group.
Norway cleared Yunus of wrongdoing but the 70-year-old, who won the 2006 Nobel Peace Prize, was accused of “sucking blood from the poor” by Bangladeshi Prime Minister Sheikh Hasina and his bank was subject to a government probe.
“The probe has accepted that the Norwegian government’s decision was final. There is nothing to do about it,” Bangladesh finance minister A M A Muhith said.
Probe committee chief A K M Monowar Uddin Ahmed told AFP that they had seen the trove of papers and letters on which the allegations of aid misuse were based and had “come to a conclusion that the issue was amicably settled”.
The government-appointed investigation committee also found no truth to allegations Grameen Bank charged excessive interest rates on loans to the poor, said Muhith.
“Grameen Bank’s interest rate is the best among all the microfinance institutions,” he told journalists after receiving a copy of the report, which has not yet been released.
Grameen Bank charges around 20% interest on its micro loans.
The figure is the lowest among the country’s 1,200-plus micro-lenders, whose rates average around 30-45% interest, according to the government’s Microcredit Regulatory Authority.
Yunus was last month fired by a central bank order, which claimed he failed to seek the bank’s approval when he was reappointed managing director of Grameen Bank indefinitely in 1999.
The High Court upheld the order in a 8 March 8, saying the dismissal was legal and that Yunus had also exceeded Grameen Bank’s mandatory retirement age of 60.
Backed by international lobbying, Yunus has defied the sacking order by filing a legal appeal and continuing to work at Grameen Bank’s Dhaka headquarters.
The Supreme Court has said it would review the dismissal decision on 2 May.
Supporters of Yunus, who has also been vilified in the Bangladeshi press, say his legal woes stem from a fallout with Hasina in 2007 over his short-lived attempt to found a political party.
Analysts say Grameen’s huge influence in Bangladesh and its move into solar panels, mobile phones and other consumer goods has made the government envious of its reach.
Yunus’s sacking has sparked street protests in Bangladesh and widespread condemnation from overseas, with the US and French governments both repeatedly calling for an amicable resolution to the standoff.
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First Published: Mon, Apr 25 2011. 06 54 PM IST