Finance Minister AMA Muhith has asked the officials concerned to arrange a seminar to get recommendations from stakeholders to prevent fraud practices by multi-level marketing (MLM) companies like (now defunct) Jubo Karmasangsthan Society (Jubok), Unipay-2U and Destiny.
On an official note proceeded recently, he stressed the need for broader consultations after going though the summary report on Jubok by the permanent commission submitted two months ago, said an official of the Bank and Financial Institutions Division.
The commission recommended enacting an MLM law as most of the MLM companies boost their wealth and expand their operations across the country blessed by the ministers, lawmakers, bureaucrats and Commercially Important Persons (CIPs).
It suggested that the authorities file criminal cases against 40 people it identified to be involved with the forgery and embezzlement of Jubok clients’ money and properties like land, buildings and business organisations.
After having a look at the 175-page report, the finance minister observed that the MLM companies were running banking operations under the cover of the cooperatives law.
“But now, there is no scope of that kind of operation by MLM companies… we need to go through a brainstorming to find ways on how to prevent the forgery,” he said, suggesting that the brainstorming session with stakeholders would discuss the laws, including cooperatives and society registration laws.
Muhith said the participants should cover representatives from the ministries of law, commerce and cooperatives, the banking sector and the civil society.
The Permanent Commission recommended appointing an administrator to sell the defunct firm’s assets and repay the clients who were cheated.
The District Commissioners and UNOs (upazila nirbahi officers) will control and inspect the wealth of Jubok before appointing an administrator, said the report prepared at the end of the commission’s two-year tenure.
The commission report reads: “The business licences of the 17 subsidiaries of Jubok, a multi-level marketing company, should be cancelled by the relevant government authorities.”
The commission also recommended amending provisions 406 and 420 of the criminal law, anti-money laundering law and inquiry act 1956 to punish those involved. As a result, they can never again cheat the common people with promises of windfall profits.
Meanwhile, Jubok money will be recovered from six organisations and persons after appointing the administrator through appointment of a board of arbitrators.
The six organisations and persons are: the owners of BK Tower, RTV, Victoria University and Atish Dipankar University; former secretary Mokammel Haque; and upazilla Chairman of Bhola Majnu Mia.
Jubok’s operations were suspended in 2006 on charges of involvement in illegal banking. Its subsidiaries include interests in housing, telecommunication, real estate development, tourism, health and agriculture.
In 2010, the government formed a probe commission, headed by former Bangladesh Bank governor Mohammad Farash Uddin, which recommended a permanent commission to ensure the repayment of depositors’ money from Jubok’s assets.
The government, in May 2011, formed the permanent commission for two years and appointed former joint secretary of home ministry Rafiqul Islam as chairman of the commission.