Many of the investors opened multiple accounts. And there are also examples that one individual opened over a 100 accounts
All that glitters is not gold.
But to the around six lakh investors in the Multilevel Marketing (MLM) company UniPay2U, the prospect of doubling their investment in just 10 months must have seemed like a once in a lifetime golden opportunity.
UniPay2U collected Tk6,000 crore from those hapless investors in just 13 months, enticing them with the promise of doubling their investment in less than a year through virtual gold business. Investors were told by UniPay2Uthat their money would double every 10 months from investments in gold trades abroad.
Manzoor Hossain, a resident of the capital's Mirpur, was one of those who fell victim to this too good to be true offer.
He invested Tk3 crore in the company by selling his land and his wife's jewellery, and taking loans from banks.
He opened an online account with the company and deposited money through an agent. In return, he got paper receipts. Whenever he logged on to check on his investment, he saw growing numbers in his account.
Some Investors could even see their online account balances had actually doubled. However, no investor ever could get their hands on any real money, it was only on screen, in a virtual world.
None of the investors received a return on their investment.
UniPay2U was sued by the Anti Corruption Commission (ACC) in 2011 after allegations of fraudulent activity and corruption were brought against it. The court gave the verdict last year.
In the verdict, the court directed the authorities concerned to take steps to refund the money to the depositors of UniPay2U.
But it has been 21 months since the verdict was delivered and no initiative has been taken yet to return any money to the investors. The deceived customers have been approaching the concerned authorities for months, but there has been no assurance.
The way UniPay2U used to cheat people
Registered under the Companies Act, UniPay2U started its operations in October 2009. The Anti-Corruption Commission (ACC) filed a case against the company in January 2011.
But the company had ceased its activities before the filing of the case.
UniPay2U was able to operate its fraud operation for about 13 months. In this short span of time, the company collected Tk6,000 crore from eager investors.
Anyone willing to invest in UniPay2U had to open an account with a non-refundable Tk42,000 in the company's website.
Investors could open unlimited numbers of accounts. A maximum of Tk12.6 lakh could be invested in one account.
Many of the investors opened multiple accounts. And there are also examples that one individual opened over a 100 accounts.
UniPay2U appointed several thousand agents in four metropolitan cities, including the capital Dhaka, to defraud prospective investors. The agents received commissions on the amount of investment they could collect. They used to collect investors in the MLM method.
Case and verdict
After conducting probes into allegations of corruption and irregularities by UniPay2U, the ACC in 2011 filed a case against the high officials of the company accusing them of embezzlement and laundering of investors' money.
According to the case statement, the UniPay2Uauthorities had laundered Tk3,500 crore of investors' money. It also said that another Tk2,500 crore was within the country.
On 23 January 2019, the Dhaka Special Judge's Court sentenced six officials of UniPay2U Bangladesh Limited, including its chairman and managing director, to 12 years' rigorous imprisonment.
The court also fined them around Tk2,702 crore and directed them to pay the fine in favour of the state.
The court also confiscated around Tk420 crore seized from the convicts' accounts and all properties of UniPay2U in favour of the state and directed the authorities – including the Ministry of Finance, Ministry of Commerce and the Bangladesh Bank – to return this money to the defrauded investors.
It also asked the government to bring back the money smuggled abroad and distribute it among the defrauded UniPay2U investors.
However, none of the cheated investors have received any refund yet. There is no sign that the government has taken any initiative to return the money either.
After the verdict, Manzoor Hossain frequented different government offices in the hope of getting back his money, but he didn't get any assurance.
He then filed a writ petition in the High Court last August.
During the primary hearing of the writ on 26 August, the High Court issued a rule following a trial court verdict, asking the respondents to explain within four weeks why the money embezzled by UniPay2U had not been returned to the customers.
The finance secretary, commerce secretary, law secretary, Bangladesh Bank and UniPay2U officials were the respondents in the writ. However, even after one more month has passed than the specified time, there has not been any explanation from the respondents.
Bangladesh Bank lawyer Tanjib-ul Alam told The Business Standard that they are preparing to respond to the rule.
He said the central bank will present a statement to the High Court on the process by which the money seized from UniPay2U's bank accounts can be returned. The Bangladesh Bank will act in accordance with the court instructions.
Attorney General AM Amin Uddin said the finance and commerce ministries will also present their statements to the court.
The government has not yet decided on the process of recovering the money and returning it to the customers. The statements will be presented on behalf of the state keeping in view a solution through the court, he added.
At the beginning of 2018, 365 UniPay2U customers filed two separate cases with Dhaka's Joint District Judge (Arbitration) Court to get back their investment of Tk271 crore. The trial of any of the two cases has not been completed yet.
Apart from UniPay2U officials, relevant government agencies, including the finance and commerce ministries, have been made defendants in these cases. None of the defendants has appeared in the court yet.
There are also 70 more fraud cases against UniPay2U officials in different districts of the country. Of those, only one case in Chattogram has been tried but the plaintiff has not got any money back.
In 2012, 35 investors in the capital filed a fraud case against the company with the Mohammadpur police station. Police have not submitted the probe report to the court as yet.
3 UniPay2U bosses already served 9 years of sentence?
Three of the six convicted UniPay2U top officials – managing director Mohammad Muntasir Hossain, manager AM Jamshed Rahman and director HM Arshad Ullah – have been in jail since 2011.
They have already served over nine out of the 12 years of imprisonment since their arrests and will have to serve a maximum of 2-3 more years, according to legal experts.
However, Saifuzzaman Tuhin, lawyer for the writ petitioner, said the convicts would not be released even if the sentence is completed.
If they do not deposit the fine of Tk2,702 crore in the state treasury, they will have to stay in jail. They will have to apply for the release by depositing at least half the amount, he explained.
The other three convicts – UniPay2U chairman Md Shahiduzzaman Shahin, executive director Masudur Rahman and adviser Monzur Ehsan Chowdhury, have been absconding, reportedly abroad.
No initiative to implement verdict even in 21 months
Officials of the Ministry of Finance, Ministry of Commerce, Bangladesh Bank and UniPay2U had been ordered to return the money to the customers in the case of embezzlement and money laundering.
Asked about it, Md Ashadul Islam, senior secretary at the Financial Institutions Division under the finance ministry, refused to talk over the phone.
Commerce Secretary Md Jafar Uddin, too, said, "The matter is now being tried in the High Court. So, I do not want to talk about it."
Asked about the Bangladesh Bank initiative in this regard, Sirajul Islam, executive director and spokesperson of the central bank, replied, "The Bangladesh Bank is not directly involved in the matter. The Bangladesh Financial Intelligence Unit (BFIU), along with the Anti-Corruption Commission (ACC), Criminal Investigation Department and the relevant branch of the finance ministry are looking into it."
BFIU chief Abu Hena Mohd Razi Hasan said, "We have collected information about their [UniPay2U's officials] bank accounts following the allegations and forwarded the details to the investigating agency."
"We have not much to do to refund the customers as per the court order," he said. He refused to elaborate on any update on the issue without gathering further information .
Abu Hena, also a former deputy governor of the Bangladesh Bank, said a receiver would have to be appointed to return the money.
It is unfortunate that the government has not taken any initiative yet to return the money to the investors even after the court verdict, said Dr Mohammed Farashuddin, a former governor of the Bangladesh Bank.
ACC Secretary Muhammad Dilwar Bakht said the commission, based on an investigation, filed a case against UniPay2U and the trial has ended too.
In order to return the money to the investors, the finance ministry, the Bangladesh Bank and others concerned will have to work as per the court verdict, he added.
Abdul Baset Majumder, former president and senior lawyer of the Supreme Court Bar Association, said, the investors may receive High Court directives to get the money back after the disposal of the writ petition filed in August last.
The High Court may appoint one or more ministries or government institutions as receivers to refund the customers, he said.
UniPay2U's hidden money, property worth crores of taka
Investigating UniPay2U's fraud, the ACC found more than Tk420 crore in the company's bank accounts. Although the ACC discovered many land plots bought with the investors' money, those were not registered in the investors' names.
The national anti-corruption body also received information about the firm's laundering of investors' money to Singapore, Malaysia and Canada.
The ACC investigation found "specific information" about the smuggling of Tk300 crore to Malaysia by the firm officials some of whom have fled to that country.
However, the ACC investigation could not ascertain the total amount of money smuggled out of the country by UniPay2U.
One of the many properties bought with the money of UniPay2U's customers is located on Elephant Road in the capital. The 33.75-decimal land bought in the name of UniPay2U chairman Md Shahiduzzaman Shahin for around Tk7 crore was later deeded in the name of another person. Now, real estate company Easy Builders is constructing an 8-storey building there.
In Uttara, 27 decimals of land was primarily bought in the name of UniPay2U's managing director Mohammad Muntasir Hossain. The land is now registered in the name of Rafiqul Islam, a relative of Muntasir. A building is being constructed there too.
Lands worth around Tk100 crore have also been bought in the name of a Kushtia political leader, close to Muntasir, in different parts of the country, including the capital. The organisation also paid Tk1 crore to buy a daily newspaper published from Dhaka.