Norway Orders Probe on Grameen Aid Diversion

Muhammad Yunus, founder of Grameen Bank, speaks during a session at the 2010 World Economic Forum, on Jan. 27 in Davos, Switzerland. A documentary film alleges that Yunus and his associates diverted some USD100 million in grant to the bank to another Grameen company. Photo by: Remy Steinegger / World Economic Forum

Norwegian Minister of the Environment and International Development Erik Solheim has ordered the country’s aid agency to investigate allegations that millions of dollars in aid money to Grameen Bank was diverted to another entity under the group of companies headed by Nobel Peace Prize laureate Muhammad Yunus.

The allegations came from a documentary on microcredit by Danish filmmaker Tom Heinemann, who said he obtained most of his documents from the Norwegian Agency for Development Cooperation’s office in Oslo while doing his research for the film. The documentary revealed that around USD100 million in grant money was diverted from Grameen Bank to Grameen Kalyan, which does not have microcredit operations. It also indicated that Grameen returned some USD30 million in aid money, which were given by Norway, Sweden and Germany, after Norwegian authorities had raised their objections to the alleged fund transfer.

Grameen Bank has issued a statement denying the allegations and promised to provide a full explanation with more details at the “earliest convenient time,” BBC reports.

According to Solheim, the Norwegian government does not suspect the bank of tax fraud or corruption.

“Having said that, the Government of Norway finds it totally unacceptable that aid is used for other purposes than intended no matter how praiseworthy the causes might be,” he wrote in a statement e-mailed to BBC. 

About the author

  • Eliza Villarino

    Eliza Villarino currently manages one of today’s leading publications on humanitarian aid, global health and international development, the weekly GDB. At Devex, she has helped grow a global newsroom, with talented journalists from major development hubs such as Washington, D.C, London and Brussels. She regularly writes about innovations in global development.

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