Evaly took more than Tk 48.67 billion from customers, but the High Court-appointed board of directors could not get to the bottom of how many products the e-commerce platform delivered before it was closed down on charges of fraud.
The board handed the charges on Thursday to Chairman Shamima Nasrin, who was recently freed on bail in dozens of cases over their handling of the company.
Launched in 2018, Evaly gained prominence with its lucrative offers on home appliances, TV, refrigerators, air-conditioners, washing machines, motorcycles, and other products.
Many customers capitalised on Evaly's generous discounts of up to 50 percent by reselling the products. They invested in reselling products purchased from Evaly by borrowing hundreds of thousands of taka or selling land and gold ornaments.
Later, thousands of complaints were filed against Evaly for its failure to deliver products or refund customers for months despite taking advance payments.
The Rapid Action Battalion arrested Managing Director Mohammad Rassel and his wife Shamima on Sept 16 last year in a case filed by a customer. They were later placed on remand for questioning.
Shamima was released eight months later on Apr 8 after being granted bail in all the cases against her.
Speaking after the handover, former Appellate Division judge Justice AHM Shamsuddin Choudhury, who headed the court-appointed board, said they found out how much money Evaly had taken from the customers, but could not be certain how many products it had delivered until its closure because they could not access the server.
Citing a report they made, Justice Shamsuddin said, “Evaly was established to dupe the customers. It wasn’t formed to do business honestly. They defrauded the customers all the time.”
“There was no transparency of accounts. Audit reports showed tens of billions of taka were transferred, but there is no trace of where the money went and who it came from.”
Justice Shamsuddin said Rassel ran the company as a “one-man enterprise”. “He was the MD and he worked as the finance officer at the same time. No one else knew anything.”
“In 2018 and 2019, he told the media that the accounts were audited. But both the audit reports are fake. Because after talking to those auditors, we have come to know that no such audit has been done by them.”
The former judge said, “Employees have also been cheated out of their salaries. The salary of some employees is shown as Tk 100,000, but they admitted that they used to get Tk 60,000. They were paid in cash, which is a crime. Because, if the salaries were paid by cheque, there would be accounts of income tax.”
“Some vouchers mention payments, but not the recipients. There is no account of where these tens of billions of takas went. There must’ve been money laundering. We’ve recommended an investigation by the relevant agency.”
The report also blamed the merchants who continued to supply goods to Evaly even after it became clear the company was going broke.
WILL EVALY SURVIVE?
Justice Shamsuddin believes it will not be possible for Evaly to revive its business if it continues to operate the same way as Rassel ran it.
“Rassel started the company to embezzle funds from its customers. He cheated customers at every stage of the business. I do not think the customers will be refunded under his family’s direction.”
The board, however, did not file for bankruptcy, keeping the option open for Evaly’s revival with new investment.
Mahbub Kabir Milon, managing director of the court-appointed board, however, is hopeful that Evaly can turn around if it gets time. “Evaly’s business will continue. This is why the new board has taken charge.”
“Maybe they will be able to bring new funds. Everyone must be patient and wait for some days. It can be a lengthy process. Maybe the customers and merchants will get their money or product. But if they rush the process, it’ll harm everyone.”
Hundreds of merchants and customers gathered outside the Evaly office in Dhaka’s Dhanmondi following the transfer of the e-commerce platform’s responsibility to the family of Shamima.
They expressed their gratitude to the court for resuming Evaly’s operation. Instead of getting their money back, they demanded Rassel’s release from prison.
“We are hopeful as the court allowed Rassel’s family to rejoin the board. The e-commerce firm will be able to refund its customers gradually if the business goes well,” said Sakib Hasan, one of the conveners of the Evaly Merchant and Customers Coordination Committee.
“We are not appointed to retrieve customers’ money. We had been asked to investigate the issues behind the crisis and how the company can be turned around. We have submitted a final report on our findings to the court. We believe Evaly will bounce back if it can secure necessary investments,” Milon said.