Bangladesh probe clears Muhammad Yunus of misusing aid

Yunus has been under fire since December when Norwegian documentary claimed $96 million of aid had been diverted from Grameen Bank.

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 today.

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 on May 2.

Yunus has been under fire since last December when a Norwegian documentary claimed USD 96 million of aid had been diverted from Grameen Bank,which provides small loans to the poor,to other parts of Grameen

group.

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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,referring to the fact no evidence of wrongdoing was found.

The government-appointed investigation committee also found no truth to allegations Grameen Bank charged excessive interest rates on loans to the poor,Muhith said.

“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.

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Grameen Bank charges around 20 per cent 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 per cent 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 March 8 ruling,saying the dismissal was legal and that Yunus had also exceeded Grameen Bank’s mandatory retirement age of 60.

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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 May 2.