Grameen Bank didn't embezzle funds: Norad

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Norad says it found no evidence of embezzlement of the Norwegian funds given to Grameen Bank but that the bank did transfer the aid money to its sister company, breaching agreement,reports bdnews24.com.
The Norwegian aid agency submitted a report to its government Tuesday on the country's support to the microlender in the 1980s and 1990s. The report follows a Norwegian TV documentary on microcredit alleging unauthorised transfer of funds from Muhammad Yunus' Grameen Bank to another sister company.
Norway's environment and international development
minister Erik Solheim asked Norad to prepare the report after the TV documentary series "Brennpunkt" raised the question of where the Norwegian aid money had gone.
Norad's report shows that Grameen Bank transferred a total of Norwegian kroner (NOK) 608.5 million to its sister company Grameen Kalyan in 1996. Norway's share of this amount is estimated to be approximately NOK 170 million.
The Norwegian embassy in Dhaka was furious to discover that cash donated to Yunus' microcredit arm Grameen Bank for housing loans was diverted to Grameen Kalyan without its knowledge or permission.
The arrangement, which Yunus claimed was made for tax reasons, was not mentioned in Grameen Bank's annual report for that year.
In the embassy's view, the transfer was not in accordance with the agreement and it took up the matter with Grameen Bank.
Following negotiations, it was agreed in May 1998 that NOK 170 million was to be transferred back from Grameen Kalyan to Grameen Bank.
The Norwegian government has maintained that even though Yunus did not steal money, the fund transfer was 'unacceptable'.
"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," said minister Solheim.
"The matter was concluded when the agreement concerning reimbursement of the funds was entered into in May 1998 under the government in office at the time," he added.