Nobel Laureate Dr. Muhammad Yunus, who was once celebrated at home and abroad for his efforts to end poverty through the micro-finance program in Bangladesh, has seen a meteoric fall in his reputation for allegations including, money laundering, tax evasion, violating labor laws, exploiting marginalized people in the name of poverty alleviation, influencing the World Bank to scrap the Padma Bridge financing, misuse of power and many more.
The controversial Nobel winner is now in hot water over labor law violations and losing Grameen Banner’s crown, as the Grameen Bank on February 12 legally appointed new directors to the 8 of Grameen organizations, replacing him. From leveraging foreign mighty friends and ‘statement diplomacy’ to play the victim card, he is leaving no stone unturned to impede the judicial process.
You can also read: Grameen Bank Refutes Dr Yunus’s Claim as Untrue
On February 24, Professor Dr. Yunus talked with journalist Khaled Muhiuddin at a live event at Deutsche Welle Bangla’s program ‘Khaled Muhiuddin Jante Chay’, where he manipulates some facts by victimizing himself to recover his lost face.
Khaled Muhiuddin, head of the Deutsche Welle (DW) Bangla also presented some ‘fabricated’ data like ‘Sheikh Hasina has enmity with you’ and unusually allows Dr. Yunus to victimize himself and ‘distort’ the facts.
Forceful Occupation: ‘A Deliberate Lie’
While speaking at the talk show, Dr. Yunus Claims that the Grameen Bank forcefully occupied his organizations under the Grameen Banner. “The goons on February 12 broke into and occupied our offices. We were panicked and sought support from the police but they were reluctant,” Dr. Yunus falsely claimed.
Immediately after the same allegations were raised on February 12, The Grameen Bank debunked the allegations, terming them as misleading, false, illegal, and deliberate.
As per the Articles of Association of Grameen Telecom (Articles 51, 35(iii), 51, 48) and Grameen Kalyan (Article 32(iii)), the Bank has the authority to appoint the chairman and a number of directors of organizations formed under its financing. In line with the regulations, the bank on February 12 appointed new directors for Grameen Telecom and Grameen Kalyan, replacing Yunus as chairman.
Revealing the truth, the bank said that such ‘misleading and untrue statements’ from Dr. Yunus undermine the rights of Grameen’s 1.05 million members and their families.
Yunus’ Social Business: A Scam?
Dr. Mohammad Yunus on Saturday’s show said that he and his team do not support profit maximization in the name of business, rather they promote social business for the collective profit and help the poor.
Dr. Yunus is a pioneer of micro-financing in Bangladesh in the name of poverty alleviation through Grameen Bank or other associated organizations. But the adverse impacts and exploitative nature of micro-credit have brought further hardship to the impoverished population of the nation, exacerbating their financial struggles. Yunus’ microcredit has evolved into a lucrative enterprise that takes advantage of the destitution of vulnerable individuals by offering loans. It ultimately propagates interest burdens at the grassroots level, leading to the emergence of new cycles of indebtedness.
A documentary titled ‘Caught in Micro Debt,’ produced by Danish journalist Tom Heinemann and aired on Norwegian state television, sheds light on the ineffectiveness of ‘micro-credit’ in combating poverty. This underscores the fact that the notion of ‘Microcredit and poverty alleviation’ touted by institutions like Grameen Bank is, in reality, an empty and hollow slogan.
In Bangladesh, a significant 67 percent of micro-loans procured by the country’s impoverished citizens are directed towards non-productive sectors, offering no contribution to the alleviation of poverty. A recent report from a survey conducted by the World Food Program in Bangladesh underscores the grim reality that these loans can be dangerous if not managed properly.
Not only setting the ‘debt trap’, but Dr. Yunus is also accused of violating labor laws and exploiting their money. The court has recently sentenced Dr Yunus and his associates to six months in Jail but has granted a bail plea.
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Dr. Yunus was prosecuted for violating certain provisions of the Bangladesh Labor Act 2006, such as failure to regularize 67 contractual employees, failure to set up an employee participation and welfare fund, and failure to contribute five percent of the company’s dividends.
Tax Evasion Attempt
Dr. Yunus in his interview said that he is against maximizing personal profit in business and instead, advocates for social welfare. But interestingly he tried to evade a huge sum of money by ‘donating’ TK 760 million to his controlled trusts.
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Sensing the matter, the National Bureau of Revenue (NBR) audited the matter and demanded TK 160 million in accordance with the Gift tax law against these so-called donations. To evade tax, Dr. Yunus appealed to the court and subsequently lost in legal battle and had to pay Tk12 crores.
Dr. Yunus argued that he made these contributions out of concern for his ‘death’ and that they should therefore not be considered taxable. Upon further examination, it was discovered that Dr. Yunus and members of his family were trustee members of these trusts and ultimate beneficiaries of these funds.
But on Saturday’s show, he falsely claimed that none of his family members can claim money from the trusts. He said that he was unaware of taxation out of donation and spontaneously paid the tax upon knowing the rules. This is another blatant lie. He didn’t pay the tax spontaneously rather forced to pay upon the court order.
It is upsetting and shameful to see a Nobel laureate and seasoned economist evade taxes through illegal means. Dr. Yunus attempted to reduce his wealth by funneling funds to a trust that he and his family controlled, allowing them to enjoy the wealth tax-free.
Other Charges
- Grameen Bank’s current chairman recently revealed detailed information that Dr. Yunus had siphoned off substantial sums from Grameen Bank to establish several new entities.
- Dr. Yunus is accused of misappropriating employee dividends, making unauthorized deductions labeled as lawyer’s fees, and transferring Tk 2,977 crores for money laundering and embezzlement, totaling Tk 45 crores including interest for the workers’ welfare fund.
- Grameen Telecom submitted inaccurate annual returns to the Registrar of Joint Stock Companies and Firms (RJSC). Despite distributing significant funds to Grameen Kalyan, they falsely claimed in their returns that no dividends were distributed. This action violates Section 397 of the Companies Act, 1994, which carries penalties for such misrepresentation.
- Between 1997 and 2022, Yunus and affiliated organizations received a total of BDT 977 billion from the company’s operational council. An ongoing investigation is probing allegations of money laundering amounting to approximately BDT 300 billion by Grameen Telecom. Additionally, the company’s chairman, Nobel laureate Dr. Muhammad Yunus, and 13 others are accused of embezzling BDT 250,227,806 from the Welfare Fund, intended for the assimilation of BDT 25,22,780.
Political Ambition?
In response to Khaled Muhiuddin’s questions, Dr. Yunus said that he never had political ambitions as he has no expertise in this field.
“The Army requested me repeatedly to be the head of the government in 2007 but I didn’t agree with them, as I am not in this field and I have no expertise here. Who could reject such a proposal? I did, because I had no ambition in politics,” Dr. Yunus said.
But in reality, when the caretaker administration took over the state power in 2007, Dr. Yunus mounted a perilous political horse. Although he had never been a part of any democratic movement, on February 11, 2007, he sought the support of the countrymen to launch a political party to reform the politics of Bangladesh. Doesn’t it substantiate his political ambitions?
Wikileaks published an article titled “Nobel Prize Winner Dr. Muhammad Yunus Considers Entering Bangladesh Politics” on Feb 13, 2007. The article mentioned that Dr. Yunus had detailed discussions with Indian officials to make a debut in Bangladesh politics.
Before the 12th Parliamentary Elections, the Nobel Laureate clearly stated that the election would be meaningless if it was not held under a Caretaker Government, though this provision is no longer a part of Bangladesh’s constitution. This proves that for his own political ambition to be fulfilled, he took a position even to undermine Bangladesh’s democratic norms and constitution.
Playing the Victim Card?
Prof. Yunus has attempted many times to seek impunity and avoid labor law violation cases and other financial misappropriation by leveraging his global reputation and Nobel fame. He has used his global friends and utilized global media to highlight his achievements and so-called ‘Noble face’ while deftly avoiding grave accusations of exploiting thousands of poor Bangladeshi citizens in the name of poverty alleviation.
Yunus has gathered support through international petitions, featuring endorsements from famous figures, creating the impression of global backing. This tactic diverts attention from labor law violations. Instead of addressing the charges directly, Yunus seeks endorsements to paint himself as a victim of politics.
Recently, 12 US senators’ letter urged Sheikh Hasina to stop the abuse of Bangladesh’s judicial system (over the trial of Dr. Yunus). Their letters strongly sided with Dr. Yunus and matched with the previous propaganda by 40 eminent persons and then 160 other eminent persons. 40 world leaders jointly published an open letter as a full-page ad in the Washington Post forUS$73,033.
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Several legal and ethical questions come to the fore in the wake of the open letter. According to Article 94(4) of the Constitution, judges are completely independent in their judicial work. According to the constitution, no one involved in the administration of the state, including the Prime Minister, has the power to interfere in the judicial process. The statement of the said letter is contrary to the Constitution of Bangladesh and the fundamental rights of workers recognized by the International Labor Organization (ILO).
While reading out the verdict sentencing Dr. Yunus to six months in jail, the court said, “Dr. Yunus is not tried as the Nobel-Winner, he is being tried as the chairman of Grameen Telecom. And allegations of violation of labor law have been proven against him.”
However, Prime Minister Sheikh Hasina has repeatedly assured that Dr. Yunus can hire lawyers from anywhere in the world to prosecute his case and get a judgment in his favor but on Saturday’s talk show, Dr. Yunus claimed without any evidence that the government didn’t cooperate to welcome foreign legal expats.