Govt to sell Destiny, Jubok assets to pay victims

The government is mulling over steps to expropriate Destiny and Jubok assets to pay off debt owed by the two controversial firms to their customers.

To this end, the commerce ministry has taken initiatives and asked the Ministry of Law, Justice and Parliamentary Affairs to see through a legal procedure for selling the assets, thereby making restitution for the victims.

In its primary observation, the commerce ministry found that the value of assets owned by Destiny and Jubok have appreciated over the last few years.

With their current value, about 50-60 per cent of dues the two companies owe could be paid off.

Commerce Minister Tipu Munshi said the clients of Destiny and Jubok can be compensated if the assets of the two are sold right now.

“It is not possible to pay the total liabilities of the customers, however, we will try as much as possible to pay the victims,” according to the minister.

“We do not want to evade our duty. We are committed to doing everything with the law. The government will appoint an agency in this regard.”

The minister was talking to journalists after a Workshop jointly organised by the Economic Reporters Forum (ERF) and Bangladesh Competition Commission (BCC) at the latter's office in Dhaka on Sunday.

The scams of Destiny2000 Ltd and Jubo Karmasangsthan Society (Jubok) rocked the country so much that the government had to make stringent regulations for controlling such business.

Jubok and Destiny have swindled thousands of people out of Tk 7000 crore a few years back.

The government primarily banned MLM. There was a gazette notification regarding obtaining licence mandatorily for conducting

Multilevel Marketing (MLM) business, but still no such company has reportedly got any licence under the law.

Before making law, the Registrar of Joint Stock Companies and Firms (RJSC) registered 62 companies while more such unregistered ones are doing the same MLM business under different names and employing different tricks.

An MLM enterprise Jubok came into being in 1994 by providing micro-credit to its members and went on to set up more than 20 business outfits.

Later, the business firm turned to telecommunications, housing and real estate development, tourism, health, ceramics, seafood, IT, nursery, agro-biotech industry and capital management by 2006 owing a staggering Tk 2,588 crore to its clients, according to probe reports.

A six-member probe body formed in January 2010 led by former BB Governor Mohammad Farashuddin recommended that the government constitute a permanent commission to return the money to the depositors.

Subsequently in 2011, another commission was formed led by a former joint secretary Rafiqul Islam to find ways to return the swindled funds.

In August 2014, a seven-member inter-ministerial committee reviewed the recommendations of the previous two commissions.

The committee, which handed in its report to the commerce ministry in December 2014, also called for a permanent commission, which has not been formed yet.

In September 2016, an inter-ministerial meeting took place at the finance ministry, where it was learnt that the government never pursued the issue with much seriousness.

“It is a dead issue,” the then Finance Minister AMA Muhith told reporters after a meeting. "There is no scope to do anything about it afresh."

And the government had also been silent on the matter since.

Destiny Group made off with Tk 4,118 crore from its clients who are yet to get back their funds.

Destiny Group Managing Director MD Rafiqul Amin and Destiny Multipurpose Cooperative Society Chairman Mohammad Hossain have long been facing cases of fund embezzlement and money laundering.

Allegations had it that the duo laundered money worth Tk 96 crore.

In 2012, the ACC filed two separate cases against 53 individuals involved with the Destiny scam, but the cases are still pending. The anti-corruption watchdog claimed that it has yet to complete the process of the testimony of the lawsuits.

According to the Police Headquarters, 34.4 per cent of the cases registered with the police stations are about financial fraud, a large part of which is committed through MLM businesses.