Cheating Thru’ Mlm
Destiny under scanner
Regulators have moved to probe the Destiny-2000 Ltd scam spotted by Bangladesh Bank, following a series of news reports on the issue over the last few days.
The Department of Cooperatives (DoC), which is the principal regulator of cooperative societies, has formed a high-powered committee to investigate the matter.
It has also asked its officers to complete auditing of Destiny-2000 Ltd by April 30, a month ahead of the scheduled time.
The National Board of Revenue (NBR) and the Anti-Corruption Commission (ACC) have also moved to probe possible tax dodging and money laundering by the multi-level marketing (MLM) company.
“The Department of Co-operatives has formed a five-member high-powered team led by an additional registrar to probe the irregularities by Destiny,” Iqbal Hossain, additional registrar of DoC, told The Daily Star yesterday.
“Officers have also been asked to complete auditing of Destiny’s accounts by April 30,” he added.
Recently, various newspapers published reports on the irregularities of Destiny-2000 following a Bangladesh Bank inquiry that found proof of illegal banking by Destiny Multipurpose Co-operative Society, a sister concern of Destiny.
Illegal banking by the company is creating disorder in the country’s financial sector, said the BB probe report, which was sent to the finance ministry recently.
“I have asked one of the commissioners to form an investigation team to probe any possible money laundering by Destiny,” ACC Chairman Ghulam Rahman told The Daily Star yesterday.
“If it is not formed today [yesterday], it will be done tomorrow [today],” he added.
The NBR, on the other hand, will scrutinise the tax files of Destiny and its profit distribution among members to see if the company has evaded tax.
The NBR has asked its field offices to send tax files of Destiny and its sisters concerns to Dhaka soon, Md Alauddin, member of audit, intelligence and investigation of the NBR, told this correspondent.
“We will initially study the company files that we already have. Later, we will collect documents of the company’s sister concerns to track any wrongdoing,” he said.
Registered under the DoC, Destiny-2000 Ltd began operation in 2000.
Currently, the NBR has tax and audit reports of 12 entities of Destiny Group, which, according to its website, has 42 sister concerns.
Alauddin said Destiny has raised hundreds of crores of taka from people through its cooperative window, which enjoys tax exemption.
The tax regulator will also scan the accounts of the Cooperative to see if it has properly distributed profits to its members or not.
The central bank investigation has found that the company is involved in banking activities — from deposit collection to lending — illegally. It has around 70 lakh members and set a target to take the number to 1 crore by this year. The probe also found a link between the current liquidity crisis in the banking sector and the booming MLM business.
As on December 31, 2011, the organisation collected nearly Tk 2,000 crore in deposits and share capital from people.
Of the deposit, the bulk amount is lent to its sister organisations and only a small portion to its members.
The BB report said Destiny did not try to borrow from the banks or capital markets to meet its demand for capital.
-With The Daily Star input
