It was the lure of high profits that drove Mohiuddin Robin to deposit money with a cooperative society. But it wasn’t long before the 31-year-old was overcome with a sense of despair.
Robin found out that the cooperative society was a fraud and all his money was gone.
Robin, his family members, relatives and friends invested Tk 44 lakh in the cooperative society that promised to give a 24 percent annual profit (Tk 2,000 a month for Tk 1 lakh). Now, his relatives are putting pressure on him to return their money.
Many like him were cheated by Pubali Multipurpose Cooperative Society that took Tk 19 crore from 220 non-members between 2006 and 2009. Many of the victims are women who now face severe financial crisis.
The mastermind behind the fraud is Syed Ali Ahsan, who changed his name to Syed Ali Ashraf to become the chairman of the cooperative society. Interestingly, 17 of the 22 cooperative society members are his family members and relatives.
A section of cooperative officials helped Ali run illegal banking in the guise of a cooperative society.
“Ahsan has made a fortune. He built a 10-storey building at Siddhirganj in Dhaka, and another in his village home at Choddogram in Comilla with people’s money,” said Hasan Imam Firoz, who became the cooperative’s managing director in March, 2010.
Ali also set up a CNG station and a few other companies with people’s money. He is now involved with controversial Destiny Group, said Firoz.
After taking charge, Firoz found massive anomalies in the cooperative’s activities during an audit. When Firoz pressed Ali to return the depositors their money, Ali and his brother with the help of a cooperative officer removed Firoz from office and filed two general diaries against him.
Firoz and his wife invested hefty amounts in the cooperative society but they did not disclose the exact amount.
Getting registered in March 2005, Pubali Multipurpose Cooperative Society started collecting money through advertisements and offered Tk 2,000 as interest per month for a deposit of Tk 1 lakh.
Some depositors received the offered interest till December 2008. But, in January 2009, they suddenly found the cooperative’s Paltan office closed and realised that they had been cheated.
Robin joined the cooperative as an employee in October 2005. In early 2006, one of his friends influenced him to invest Tk 2 lakh in the cooperative society. Robin later encouraged his family members, relatives and friends to deposit money with the firm.
He invested Tk 15 lakh in phases and his relatives and friends Tk 29 lakh through him. Now they all want their money back.
“I have been hiding for the last one year…even my family members are under pressure,” said Robin.
Yasmin Sultana, whose husband is abroad, invested Tk 30 lakh and Zohura Begum in Jatrabari Tk 8 lakh in the cooperative society. Md Tareq, a senior banker at a private bank, deposited Tk 24 lakh with the cooperative society.
They all made the investments for interest at a much higher rate than in commercial banks, post office or other savings instruments.
Many organisations like Pubali are collecting crores of taka from people in the name of cooperative societies. Destiny-2000 that started as an MLM company in 2000 established a cooperative firm after a few years to collect money from people easily.
“Nearly 30,000 cooperative organisations are involved in banking activities. If Destiny faces government action, all these cooperatives must face the same fate,” Mohammad Rafiqul Amin, chairman of Destiny Group, told The Daily Star recently.
Destiny recently came under the regulators’ scanner for its illegal activities that include unlawful banking. But many others like Pubali remain out of the government scanner.
“We get a lot of complaints from depositors like those of Pubali. But we cannot investigate all for manpower shortage,” said a senior official at the Department of Cooperatives. He said there are only 30-40 people to oversee the activities of 7,000-8,000 cooperative societies.
Iqbal Hossain, additional registrar of the Department, said some loopholes in the existing laws allow these companies to cheat people.
The loopholes include automatic registration of a cooperative society for the authority’s failure to register it in 60 days of application, and allowing cooperative societies to collect deposits from non-members.
The cabinet yesterday approved the draft of the Cooperative Society (Amendment) Act, 2012 with provisions of up to seven years’ imprisonment and a fine of Tk 10 lakh for running illegal banking. The draft law proposes preventing cooperative societies from taking deposits from non-members.
-With The Daily Star input
