Hefty Graft Spectacle, Hideous Financial Breaches by Orion Group Stun Everyone

 
Orion Infrastructure Limited, a concern of Orion Group, has become a loan defaulter after failing to repay Tk 106 crore in bridge financing for the Mayor Mohammad Hanif Flyover project, according to a recent Bangladesh Bank inspection report. At the same time allegations have surfaced that Orion Group has so far siphoned away 700 (seven hundred) crore taka every year in a totally unlawful way through the construction of Mayor Hanif Flyover in Dhaka city. The corruption allegations about Orion Group and the huge business conglomerate's financial breaches did not surface until 5 August 2024 when former Bangladesh Prime Minister Sheikh Hasina escaped to India.

Toll collection on Mayor Hanif Flyover was supposed to be at least 1000 to 1200 crore taka each year but Orion Group paid only 140 to 178 crore taka to state funds annually. The tolls were scheduled to be collected with digital devices but the tolls were reportedly taken from transporters manually without any receipts or vouchers.

Bangladesh Bank's review of Sonali Bank's annual financing report for 2023, conducted in July 2024, revealed that the company had not met its repayment obligations.

Consequently, the central bank directed Sonali Bank to classify the outstanding amount as bad loans and update the Credit Information Bureau data accordingly. This development has led to the identification of Orion Infrastructure Limited's board members, including Chairman Mohammad Obaidul Karim, as loan defaulters.

The report shows that the outstanding loans provided in bridge financing to Orion Infrastructure Limited for the Mayor Mohammad Hanif Flyover project under a public-private partnership has reached Tk 106 crore as of December 31, 2023.

With four installments overdue as of December 2024, the loans should have been classified as bad loans. Although the loans were initially kept unclassified based on the company's commitment to settle the overdue payments by May 2024, only Tk 2 crore was paid in July, and 15 cheques totaling Tk 15.28 crore were issued, which were not honoured.

Given the continued non-payment and the fact that five installments (equivalent to 30 months) are overdue, the central bank has instructed Sonali Bank to classify the entire loan amount as bad loans.

Obaidul Karim, who is also the founder and chairman of Orion Group, has a history of receiving a prison sentence for corruption and embezzlement. A number of Bangladesh Bank (BB) officials and bankers said that former Bangladesh Nationalist Party (BNP) leader Obaidul Karim was significantly benefited from the immediate past Awami League government through his connection with its leaders, including Sheikh Fazlul Karim Selim, though the claim remains unverified.

He had close relations with former central bank governor Abdur Rauf Talukder who was known to intervene in inspections and reporting related to Obaidul Karim, central bank officials said.

Obaidul Karim did not respond to phone calls and messages from different media outlets for comments over the issues.

The Mayor Mohammad Hanif Flyover, which was constructed at a cost of Tk 2,108 crore, was financed entirely through bank loans.

Although Orion group barely invested in the project, it continued getting benefits from it.

Six banks and investment institutions contributed a total of Tk 2,250 crore for the project-Sonali Bank (Tk 500 crore), Rupali Bank (Tk 550 crore), Janata Bank (Tk 600 crore), Agrani Bank (Tk 500 crore), Social Islami Bank and Investment Corporation of Bangladesh (ICB) each contributing Tk 50 crore.

Despite generating toll revenue since its inauguration in 2013, the banks had not received dividends from their investments, the concerned banks claimed.

In addition, Orion Infrastructure Limited secured a 15-year income tax exemption on the flyover's earnings, citing its bank loans.

A couple of weeks ago, senior journalists from different Bengali and English newspapers attended a conference with the interim government's Information and Broadcasting Adviser Nahid Islam in the conference room of the Department of Films and Publications (DFP). A number of journalists strongly raised the point that mega loan scammers and financial fraudsters should not be allowed to run or own newspapers, satellite television channels and online news portals.

Professor Dr. Laila Haseen, Department of Economics, Jahangirnagar University said, "I don't believe the regulatory authorities had no idea what was going on with Orion Group in terms of some infrastructural projects. Such huge instances of corruption are syndicated crimes. Now the interim government must thoroughly examine the complaints which have in the meantime surfaced about Orion Group."

Professor Dr. Mainul Hasan, Economics Department of Chittagong University said "We have heard about corruption and irregularities in banks, financial institutions, big business groups, influential bureaucrats, oligarchs and syndicators for last several years but there has been no significant action. Dr. Muhammad Yunus and his cabinet colleagues have declared to take tough steps against corruption and to reform different state machineries including Bangladesh's banking and financial sectors. Everybody knows that time is running out. So, Dr. Muhammad Yunus should go for fast and severe actions against these perpetrators dexterously."