Pokhara metropolis finds Lamichhane involved in cooperative fraud

NL Today

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Kathmandu: Deputy Prime Minister and Minister for Home Affairs Rabi Lamichhane, who has been embroiled in cases of cooperative fraud, has been found to be involved in yet another case of embezzlement of deposits of a Pokhara-based cooperative.

A report of a probe committee formed by the Pokhara Metropolitan City revealed that the Suryadarshan Savings and Credit Cooperatives issued a loan of Rs 10 million in the name of Lamichhane based on a form he filled out seeking the amount. The transaction details were found when the probe panel investigated complaints of embezzlement of savings worth Rs1.35 billion belonging to 18,700 depositors of the cooperative.

On September 10, 2023, arrest warrants were issued against 19 individuals for their alleged involvement in the embezzlement of the cooperative’s public deposits worth Rs1.35 billion.

On the basis of the metropolitan’s complaint and the findings of the district police office, the district attorney office filed a case at the Kaski District Court on October 5, last year, naming 19 accused, including Gitendra Babu Rai, the prime suspect in the embezzlement of funds of several cooperatives who has been evading arrest for months.

On February 5, agitated victims filed a supplementary complaint against Home Minister Lamichhane, as well as against the cooperative’s founding member Rai, the son of former Vice President Nanda Bahadur Pun, Dipesh; the cooperative’s former chair, Gyan Bahadur Bamjan; Netrapani Bastola; and 14 companies at the district police office.

They claimed that the government did not take initiative to resolve the problem and that the police had attempted to protect the accused by hiding the report.

The Central Investigation Bureau (CIB) then formed another probe committee, consisting of representatives of the victims and the district police, and launched an investigation into the case.

The metropolis’ panel report, which was submitted to the district police office by Pokhara Mayor Dhanraj Acharya on Thursday, backed the CIB’s findings.

The panel’s findings claimed that Lamichhane, along with other suspicious borrowers’, had taken loans from the Pokhara-based cooperative. However, the report was shelved after the Rastriya Swatantra Party chair became the home minister.

The metropolis team’s report stated that the GB Rai-led Gorkha Media Network Ltd. took a loan of Rs300 million when Lamichhane was the managing director of the company and that the home minister himself borrowed Rs10 million in his name from the cooperative.

“A copy of the loan application form filled out by Rabi Lamichhane, found during the investigation, has been attached to the report. Rs 10 million had been approved as requested by Lamichhane,” said Deepak Prakash Acharya, a member of the probe committee.

The findings of the CIB and the Pokhara Metropolitan are the same.

Eighty-seven individuals, including Lamichhane, Rai, and Pun, have been named as ‘suspicious borrowers’ in the report.

Rai allegedly took Rs300 million in loans to establish the now-closed Gorkha Media Network. In return, the cooperative would be offered shares of the same amount, documents reveal.

Now, the cooperative is in crisis, and the depositors have sought the return of their deposits. But Rai has been at large for months, while Lamichhane has been claiming that there can be no investigation against him, arguing that he didn’t receive any loans from any cooperatives.

The International Criminal Police Organisation (INTERPOL) issued a diffusion notice on January 28 against Rai, who has been on the run since being accused of embezzling over Rs 1 billion.

Likewise, Pun borrowed Rs 10 million in two instalments.

As per CIB reports, Rs 1 million was transferred to a loan account 001-116-0004456 and a savings account 01-001-49-00007770, both of which are in Lamichanne’s name. Of the total loan, a cheque deposit of Rs 5 million was made to Gorkha Media Network through Gandaki Bikas Bank on May 20, 2021. The remaining amount was taken in cash on June 23, 2021.

“A total of Rs 10 million has been provided in loans to Rabi Lamichhane for 12 months at an annual interest rate of 14.75 percent,” the report says.

The cooperative had come under pressure after depositors demanded refunds, following which the audit of the amount of loans was faked, the report says.

Instead of repaying the borrowed amount, Lamichhane, on June 28, 2023, transferred the liability to the name of Gorkha Media Network.

“Lamichanne’s liability of Rs13,088,736, including interest, was transferred to the Gorkha Media Network,” the CIB report states. However, no official documents have been found regarding this deal.

As per the findings of the investigation into the complaints of 1,035 victims, Lamichhane was still the managing director of the Rai-led media network at the time of the loan transaction.

Lamichhane quit Galaxy Television, subsequently formed the RSP, and won an election for a federal parliament seat from Chitwan in November 2022. He then took office as the home minister and lost the position over his citizenship certificate row, all while the investigation was underway.

The CIB allegedly tried to hide the reports after Lamichhane was reappointed as the home minister in March this year.

Besides Suryadarshan Cooperative, the home minister is also accused of misusing deposits worth millions of rupees in the Sahara Cooperative of Chitwan and the Supreme Cooperative of Butwal.

On Tuesday, the Office of the Attorney General, however, issued a letter stating that there are no cases against Lamichhane in the cooperative fraud cases.

The first-of-its-kind letter issued by the OAG favouring Lamichhane has drawn criticism from various quarters. It was issued at the request of Lamichhane to determine whether any cases of cooperative fraud had been registered in Rupandehi, Chitwan, and Kaski districts. In his application to the OAG, Lamichhane said he needed the information to clarify to Parliament and the public the allegations he was facing.