Norway clears Muhammad Yunus' Grameen Bank of any wrong-doing

Norway has cleared Muhammad Yunus' Grameen Bank of any wrong-doing from a misuse of funds accusation. The claims that Yunus' Grameen Bank diverted money away from its intended use was made by a recent Norwegian documentary. A loan Norway gave to the Grameen Bank was transferred to another company within the Grameen family for tax purposes. Norway stated on Tuesday that Grameen was innocent and that the funds were used for housing loans as intended.

From the Economic Times, we read more about the statement from Norway and another statement from Bangladesh that will continue to beat a dead horse.

The claims were based on series of letters dating from 1996 to 1998 -- a decade before Yunus and Grameen were awarded the Nobel Prize in 2006 -- showing a conflict between the Norwegians and Grameen over the aid transfer.

After a review, Norway's minister of international development Erik Solheim said in a statement Tuesday that there was "no indication that Norwegian funds have been used for unintended purposes, or that Grameen Bank has engaged in corrupt practices or embezzled funds."

Grameen maintained the transfer of aid to Grameen Kalyan, another part of the group, was legitimate and done to minimise tax on the money.

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

Yunus and microfinance have come under fierce attack from Bangladeshi Prime Minister Sheikh Hasina , who called Sunday for a full investigation of a sector she said "does not lift people from poverty."

"Is there any other business that forces people to pay 30 to 40 per cent interest on loans?" Hasina asked, describing Grameen's transfer of Norwegian and other European aid money in 1996 to avoid tax as a financial "trick".