Destiny Multipurpose Cooperative Society Limited on Sunday filed a writ petition challenging the legality of Bangladesh Bank’s inspection report in which it recommended 14 punitive actions, including immediate ban on its membership collections drive.
In his writ petition, its chairman Mohammad Rafiqul Amin prayed for staying the operation of the recommendations, the central bank made to the finance ministry on March 11 for taking the actions against Destiny.
Rafiq also prayed to the High Court to issue a rule on Bangladesh Bank and the finance secretary to explain why the central bank’s inspection and its subsequent recommendations should not be declared ‘mala fide’ and against the principles of natural justice as the authorities gave no opportunity to the company to defend itself.
The petitioner’s lawyer former attorney general Hassan Ariff told reporters that the writ would be moved
today at the bench of Justice Farid Ahmed and Justice Sheikh Hassan Arif.
Rafiq said in his petition that being registered with the Department of Cooperatives under the Co-operative Societies Act 2001, Destiny Multipurpose Cooperative Society Limited, was neither a bank nor a company.
The petitioner said that Section 51 of the Bank Company Act of 1991, under which Bangladesh Bank asked Destiny to provide certain information for its inspection report, was not be applicable for Destiny Multipurpose Cooperative Society.
However, in the petition, he said under section 44 of the Bank Company Act, Bangladesh Bank on direction from the government could, at any time, carry out an inspection of any banking company, its ledgers and accounts.
The petition stated that the law requires the central bank to follow certain procedures including supplying to the banking company a copy of its inspection report.
The petition also stated that as the Bangladesh Bank did not follow the stipulations regarding inspection, its report and recommendations based on it should be declared illegal.
  
It described as ‘totally controversial’ the central bank’s inspection report which stated that Destiny has been mopping up people’s savings like commercial banks.
The central bank recommended, among other5 actions, banning Destiny Multipurpose Co-operative Society’s membership collection drives using the concept of multi-level marketing, institution of a high-power committee to stop its illegal savings collection and fund transfer and recommend punishment measures against its officials.
It also recommended a ban on fund transfer to Destiny’s sister concerns and projects; surplus capital of the company should be invested in government’s savings certificates; called for carrying out extensive campaign in print and electronic media against Destiny to make the people aware about the danger and risks of its activities.
It asked the cooperative department under the ministry of local government and cooperative to make Destiny share holders aware about financial liability; the department was also asked to ensure preventing the company from bribing government officials to influence its collection of savings from people.
It also asked for taxing its profits and interest earnings and appointment of audit firms for mandatory auditing its accounts.