Jubok clients still in the dark after eight years

Eight years have gone by, but about 3 lakh clients fleeced by Jubok still have no idea if they are getting back the funds they deposited in good faith with the rogue multi-level marketing firm.

In the last five years, the government has formed two commissions and one inter-ministerial committee for that end and yet, there is no concrete solution in sight.

Formed in 1994, Jubok lured in funds by promising abnormal returns. After getting wind of its duplicitous activities, the central bank in 2006 shut it down.

To date, 3.03 lakh people have claimed money by producing documents against four Jubok concerns including Jubok Housing and Real Estate Development Ltd.

To find ways to return the swindled funds, amounting to Tk 2,588 crore, to the clients, the government formed two commissions in 2010 and 2011, headed by former Bangladesh Bank Governor Mohammad Farashuddin and former joint secretary Rafiqul Islam respectively.

Due to the enormity of the tasks that needed doing, both the commissions recommended for a permanent commission.

Farashuddin told The Daily Star that Jubok has a good deal of assets that can be sold off to meet the legitimate claims of its clients. “But that would not be possible without the formation of a more powerful commission.”

Curiously, the government in August this year formed yet another body, a seven-member inter-ministerial committee headed by Abdul Mannan, a joint secretary of the commerce ministry to review the recommendations of the previous two commissions.

The committee, which handed in its report to the commerce ministry last week, too called for a permanent commission, among others.

Now, if the permanent commission will be formed or not, is up in the air.

Meanwhile, the committee has also called for a new law that allows the government to take over property and management of any company that embezzles people's funds through fraudulent means.

However, the existing laws still give the government the legal authority to take over the assets and management of Jubok, the seven-member body said in its report.

The responsibility of managing Jubok should be given to the commerce ministry, while the cabinet division, law ministry, banking division, BB and the Registrar of Joint Stock Companies and Firms would assist it, the report suggested. The committee also recommended an amendment to the anti-money laundering law to allow either one of the deputy commissioners, upazila nirbahi officer or the court to forfeit the assets of Jubok and assign the responsibility of managing it.

It has called for steps against the top officials of Jubok under the money laundering prevention law, as the offence is punishable with 4 to 12 years of jail and a fine of up to Tk 10 lakh.

However, the committee could not suggest any quick way to return the funds to the Jubok clients.

Meanwhile, the two commissions said the clients were indirectly complicit: they deposited their money with Jubok despite knowing it was an illegal firm.

Even if a workaround can be found to return the money, the clients will only get the principal amount -- and not the interest. 

The inter-ministerial committee supported the idea and said the permanent commission may take necessary actions in this regard.

The permanent commission will also take steps to appoint an administrator whose main responsibility will be to sell off the assets of Jubok and return the embezzled funds, the committee said.

Until an administrator is appointed, the deputy commissioner or the upazila nirbahi officer of the relevant areas will oversee and manage the assets of Jubok.

In this regard, the cabinet division and the ministry of public administration will issue an executive order.

The cabinet division will also issue an order prohibiting all government policymakers and high-profile officials from joining any functions arranged by organisations like Jubok.

Jubok started its operations in 1994 by providing microcredit to its members. Since its registration with the Joint Stock Companies in 1997, it has set up more than 20 business outfits.

By 2006, its tentacles spread to telecoms, housing and real estate, tourism, health, ceramics, seafood, IT, nursery, agro-biotech industry, and capital management.

Jubok Chairman Masud Al Hossain was arrested in 2009 on charges of embezzlement. He was later freed on bail.