Norway clean chit to Grameen Bank on funds transfer | india | Hindustan Times
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Norway clean chit to Grameen Bank on funds transfer

india Updated: Dec 09, 2010 15:01 IST

Norway has given a clean chit to Nobel laureate Muhammad Yunus' Grameen Bank that was charged with embezzlement and unauthorised transfer of funds of a Norwegian aid agency, an official statement said.

According to the statement posted on the Norwegian foreign ministry website, Minister for Environment and International Development Erik Solheim said that the Grameen Bank had neither embezzled the funds of the Norwegian Agency for Development Cooperation (Norad) nor used the money for unintended purposes.

The minister also said that the microfinance institution was not involved in corrupt practices, The Daily Star reported.

The remarks came after Norad on Tuesday submitted a report on the charges against Grameen Bank's alleged undue transfer of funds to sister concern Grameen Kalyan.

Last week, Solheim had requested Norad to prepare a report after a Norwegian TV channel broadcast a series of documentaries on alleged fund anomalies involving the bank.

"According to the report, there is no indication that Norwegian funds have been used for unintended purposes or corrupt practices. 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," said Solheim.

Grameen Bank, Bangladesh's pioneering rural credit bank network, and Yunus were in news last week following reports in Norwegian media, prompting Bangladesh Prime Minister Sheikh Hasina to say that she would order an inquiry.

Yunus had welcomed the move.

Grameen Bank spokesman Mohammad Shajahan said, "We are very happy that the actual proof (of Grameen's innocence) has come to light and we hope this will end all debate about Grameen."

The microfinance institution has all along maintained that the transfer of aid to Grameen Kalyan was legitimate and done to minimise tax on the money, the daily said.

Norad's report shows that Grameen Bank transferred 608.5 million Norwegian kroner (about $100 million) to Grameen Kalyan in 1996. Norway's share in it was about 170 million kroner.

The Norwegian embassy here had protested. The issue was subsequently resolved.