Norway Investigates Muhammad Yunus’ Grameen Bank


Image: World Economic Forum/Flickr

Nobel Laureate and Grameen Bank founder Muhammad Yunus is under investigation for diverting nearly $100 million in grant money from microcredit lender Grameen Bank, for which the money was intended, to Grameen Kalyan, a branch that helps Grameen members stay healthy. Yunus, who heads 30 non- and for-profit organizations under the Grameen umbrella, is denying the allegations. From the BBC:

A documentary maker has alleged that cash was diverted from Professor Yunus’ Grameen Bank to other parts of Grameen. (Filmmaker) Mr Heinemann’s report alleged that after the Norwegian authorities raised objections to the alleged transfer of funds, the Grameen bank returned about $30m. The aid money was from Norway, Sweden and Germany.

In a statement, the bank said that the allegations were false. It said that a full explanation with more details would be provided at the “earliest convenient time”.

The move by the Norwegians – who insist that no criminal activity has taken place – comes at a time when the reputation of the micro-credit industry has been under attack. The original aim of the micro-credit concept was poverty reduction, but in recent years some micro-financial institutions have been criticised over exorbitant interest rates and alleged coercive debt collection.

Reacting to the latest report, the Norwegian authorities say they have no suspicions of tax fraud or corruption committed by Grameen Bank. “Having said that, the Government of Norway finds it totally unacceptable that aid is used for other purposes than intended no matter how praiseworthy the causes might be,” Norwegian International Development Minister Erik Solheim said in a statement e-mailed to the BBC.

I saw Yunus speak several years ago. He’s one of those very rare people who I think is incapable of corruption. Heinemann, the filmmaker, created a documentary that investigated how microcredit institutions around the world are basically turning into loan sharks. It’s part of his job to uncover indiscrepancies and make them public. But if Yunus’ Grameen did something wrong, I have real trouble either seeing it as intentional corruption or seeing Yunus behind it. It’s akin to Ghandi being corrupt. That said, the microfinance industry itself is turning out to be more shady (w/high interest rates) than anybody initially expected. I’m interested to see what happens next with this investigation.

  • It is good to hear that he was cleared of the charges. His efforts to change the world have been great. If we had more people making the effort he does, the world would be a better place.

    I thought you might be interested to know that Muhammad Yunus is featured as Hero of the Week over at moralheroes.org

    Here is a link to his page:

    http://moralheroes.org/muhammad-yunus

  • Siddhartha

    Most of the communities in the entire Indian sub-continent(such as Bengali) are succumbed in ‘Culture of Poverty'(Oscar Lewis), irrespective of class or economic strata, lives in pavement or apartment. Nobody is genuinely regret ed or ashamed of the deep-rooted corruption, decaying general quality of life, worst Politico-admin system, bad work place, weak mother language, continuous consumption of common social space (mental as well as physical, both). We are becoming fathers & mothers only by self-procreation, mindlessly & blindfold(supported by some lame excuses). Simply depriving their(the children) fundamental rights of a decent, caring society, fearless & dignified living. Do not ever look for any other positive alternative behaviour (values) to perform human way of parenthood, i.e. deliberately co-parenting children those are born out of ignorance, extreme poverty. It seems that all of us are being driven only by the very animal instinct. If the Bengali people ever be able to bring that genuine freedom (from vicious cycle of ‘poverty’) in their own attitude, involve themselves in ‘Production of Space’ (Henri Lefebvre), an intense attachment with the society at large – one different pathway has to create to overcome inherent ‘hopeless’ mindset; decent, rich Politics will definitely come up. – Siddhartha Bandyopadhyay, 16/4, Girish Banerjee Lane, Howrah -711101, India.