As reported in the media, hundreds of thousands of innocent Bangladeshis have fallen victims to fraudulent practices by some E-Commerce (electronic commerce) and MLM (multi-level marketing) companies and cooperatives over the past one and a half decades, apparently due to regulatory laxity and official indifference as well as covert abetment cum underhand dealings. As many as 280 such entities have siphoned off at least Taka 210.17 billion from the pockets of hapless citizens during this period. These figures have been compiled based on the estimates provided by Bangladesh Bank, investigations of law enforcement agencies as well as claims by subscribers cum customers. The amounts included Taka 26 billion misappropriated by the MLM entity Jubok in 2006; Taka 60 billion defrauded by Unipay2u in 2011; Taka 50 billion pilfered by Destiny in 2012; and Taka 41 billion embezzled by 266 cooperatives between 2008 and 2017. In all these cases, the tactic employed has been to entice greedy or ignorant customers with promises of excessively high profits and discounts, and are symptomatic of a deeper malaise in the country's economy, society and polity.
Apart from the above-mentioned organizations, there have been reports about 11 defaulting establishments during 2021 alone. The amounts include Taka 11 billion belonging to customers and suppliers (vendors) of E-Orange, Taka 10 billion of Evaly, Taka 8.03 billion of Dhamaka Shopping, Taka 1.50 billion of SPC World, Taka 1.10 billion of Ehsan Group, Taka 80 million of Nirapad.com, Taka 310 million of Chalantika, Taka 500 million of Supam Products, Taka 200 million of Rupsha Multipurpose, Taka 300 million of New Navana, and Taka 150 million of Qworld Marketing Ltd. At present, the Criminal Investigation Department (CID) is conducting investigations into money laundering allegations against 14 E-Commerce platforms. The complaints include non-delivery of ordered items to the customers, non-refund of money, dishonouring of cheques in banks, and non-payment of dues to the suppliers.
Many cases have been lodged in courts over the past one and a half decade against these marketing schemes on the grounds of fraud, deceit and embezzlement. Some of the accused have gone into hiding, others have been arrested, and some are in jail for a long time. But the trapped customers are yet to get their money back, and the government as well as the regulatory bodies have done little to improve the situation. For example, the Jubok incident originally came to light back in 2006. The subscribers claimed that the entity had many properties and lands, and staged protests for getting refunds by selling Jubok assets. But nothing has materialised even after 15 years. The subscribers even petitioned the prime minister and finance minister for appointment of an administrator in Jubok. The finance ministry then wrote to the commerce ministry for taking necessary action. But there have been mere exchanges of letters between the two ministries since then.
The E-Commerce scandals have occurred quite openly through the digital media. The platforms enticed customers by offering hefty discounts for goods, similar to the Ponzi schemes. They collected huge sums of money through transactions via banks and MFS (mobile financial services) companies. But the victims as well as observers allege that the relevant departments of the government including regulatory authorities did not intervene at the right moment for preventing irregularities through policy or legal actions.
The much-discussed E-Commerce platform Evaly commenced its journey only in December 2018. But from the very outset, it started selling commodities at a rate much cheaper thanthe market price. This was accompanied by an advertisement cum publicity blitz, including prime-time slots in Television and FM-radio channels, branding, and even wall-advertisements at airports. The innocent, ignorant, and unsuspecting customers joined the bandwagon after becoming convinced about its genuineness. But complaints were also filed at the department of consumer rights protection from its very inception regarding non-delivery of goods as well as dilly-dallying tactics employed by the company. Other E-Commerce platforms like E-Orange and Dhamaka Shopping also resorted to similar publicity techniques. Some even recruited celebrities and icons like Tahsan, Mithila and Mashrafe Bin Mortaza as brand ambassadors. But none of the government agenciesconcerned
took any timely step to enquire about these entities or undertake in-depth investigations.
The commerce ministry became alert only after reports were published in the print media in August 2020 about suspicious business transactions of some of the E-Commerce platforms. The ministry then set up an inquiry committee and sent letters to relevant government agencies. The bank account of Evaly was frozen for one month, but its business was allowed to continue. Then the central bank informed the ministry this June through a report that Evaly had a current asset of only Taka 650 million against the liability of Taka 4.03 billion. But according to the latest figures provided by Rapid Action Battalion (RAB), the company's debts stood at Taka 10 billion, while its bank deposit was only Taka 9 million, and receivables from the digital gateways were about Taka 350 million. And now the company's chairman says he does not know how he will repay the debts.
Concerned observers claim that the current situation would not have arisen if remedial actions were taken at the very outset thorough investigation of suspicious activities including offers of huge discounts. It has been clearly a case of administrative negligence and non-performance of assigned duties by the relevant authorities. As reported in the media, even a bench of the High Court Division of Supreme Court commented recently during the hearing of a related writ petition: Why is my house unprotected? Why are my doors open? Why people are taking away looted money outside the country? The government is taking steps, but when? Only when I become a pauper! Where is my remedy? If he takes away my money, shall I move from door to door? He may go to the police station, the jail, and sleep after eating rice. But the money taken away from me - what will happen to that?
Dr Helal Uddin Ahmed is a retired Additional Secretary and former Editor of Bangladesh Quarterly.