Mohammad Rassel, chief executive officer of the beleaguered e-commerce platform Evaly, has told the Rapid Action Battalion (RAB) that his company owes more than Tk1,000 crore to customers and merchants – although just a few days ago, he had disclosed a much lower amount.
RAB on Friday said the Evaly CEO also had plans either to sell the company to a foreign e-commerce firm or to declare bankruptcy for failing to pay off the huge amount of liabilities.
In a press briefing yesterday, RAB's Legal and Media wing Director Commander Khandaker Al Moin, said, "According to a report, Evaly's liabilities stood at Tk403 crore till 28 February, but its asset was worth Tk65 crore, the amount of advance payment taken from customers was Tk214 crore, and dues to different customers and companies were Tk190 crore."
Moin said in a primary interrogation, Rassel and his wife Shamima Nasrin, who were arrested on Thursday, told RAB that Evaly's liabilities stood at over Tk1,000 crore.
A Dhaka court yesterday placed Rassel and Shamima, also the chairman of the company, on a three-day remand in a case filed over allegations of embezzling customers' money. The court also denied their bail petition filed by their lawyer.
After their arrest, they were taken to the RAB headquarters for interrogation.
The RAB spokesperson said Rassel visited Asia and Europe and approached foreign e-commerce companies with a view to selling his company with all its liabilities – using Evaly's huge customer base as "brand value".
Rassel was also trying to get local or foreign investment, but local giants refused him several times, assessing Evaly's assets and liabilities and business strategies, he said.
Since the establishment, Evaly has been incurring losses. All expenses and costs were spent from customers' money. As a result, liabilities piled up gradually, Moin added.
"Rassel's recent requests for extending times to refund customers and pay vendors showing various reasons were just techniques to consume time," he said, adding that he had planned to declare himself a bankrupt after failing to repay the debt.
Rassel had also a plan to list its company on the share market at the end of its third year in business, the RAB official said.
RAB said Evaly has a very little investment. Its business strategy was to extract a large sum of money from suppliers and customers. They lured millions of customers into paying in advance in a quick time for products with stupendous discounts and cashback offers. The offers included Earthquake, Cyclone, Priority Store, T-10, T-5 and so on.
During inquiries about Evaly's infrastructure, Rassel and his wife Nasrin told the RAB that Evaly's head office and customer care in Dhanmondi and two warehouses at Amin Bazar and Savar, all are in rented spaces.
The company at one stage had about 2,000 management staff and 1,700 temporary employees. It has now 1300 staff and about 500 temporary employees owing to a decline in the business.
The employees were once paid a total salary of around Tk5 crore monthly, which now stands at Tk1.5 crore. Many employees have remained unpaid since June.
Rassel and his wife used to take a monthly salary of Tk5 lakh each. The couple used two expensive private cars (Range Rover and Audi) at the expense of the company. Besides, the company has about 25-30 vehicles.
The RAB spokesperson said the company was engaged in a huge CSR and promotional activities to enhance its brand value. They did it with all the customers' money. "Every single day the company is running its operation, its liabilities are increasing by crores," he also said
At the individual level, Rassel has other assets in Savar, including land worth crores of money. The arrestees also said there is around Tk30 lakh in Evaly's different bank accounts. There is also around Tk30-35 crore of customers' money in several payment gateways.
Sellers want Evaly to continue operation
Suppliers want Evaly to continue its business so they can get their payments and they also expect that the government will prefer constructive ways toward resolving all the issues relating to the e-commerce company.
Md Sirajul Islam, Walton's head of Corporate Sales, said their receivables from Evaly is less than Tk15 crore.
They began selling on advances in late 2019. Since payment was regular, sales volume was increasing and very importantly, competitors were selling a lot through Evaly, Walton began selling on credit until the standstill situation in Evaly's business payment cycle was fine.
"We understand their situation and are not aggressive to be paid back at once," he said.
"However, the hope for recovery is less if the owners remain detained and continue business. We expect the government will prefer constructive ways regarding Evaly."
Hafsa Mart, a seller of imported high-end motorcycles in the capital, had a remarkable sales growth with a decent profit margin in Evaly.
Since Rassel used to clear its dues, Hafsa Mart supplied on credit and even borrowed a lot to keep supplying to Evaly even when there was no cash flow, said Hafsa Mart partner Mahmudunnabi.
The enterprise now is in financial pressure and hopes Evaly comes back in business. Hafsa Mart's receivables is nearly Tk30 crore.
Mohammed Mesbah Uddin, chief marketing officer of Fair Group, told The Business Standard, "I am yet to obtain the exact figure of our dues. It grew as we were expecting that the government would let Evaly run under an administrator like what is done for banks."
A special move to run Evaly in a controlled, much regulated way is worthy considering the public interest concerned, he added.
"Like everyone, we need to be paid back ultimately," said Mesbah.