Coops scam: Lamichhane recommended for prosecution

The special parliamentary inquiry committee, formed to investigate the embezzlement of funds from financial cooperatives, has concluded that Rs 650m funneled into Gorkha Media Network was entirely sourced from cooperatives, and that the company shares were traded using forged documents. 

The committee has recommended prosecuting four individuals, including the then-Managing Director of Gorkha Media and former Home Minister, Rabi Lamichhane, in accordance with existing laws. Others recommended for prosecution include GB Rai, Kumar Ramtel, and Chhabi Lal Joshi.

The committee presented its report to the House of Representatives on Monday, outlining eight recommendations regarding the misappropriation of cooperative funds by Gorkha Media. The report revealed that five out of seven cooperatives operated by Rai and his group had transactions totaling Rs 2.56bn with Gorkha Media, of which Rs 650m was determined to be embezzled.

The committee found that the savings of 50,000 individuals from five cooperatives—Suryadarshan of Pokhara, Supreme of Butwal, Swarnalakshmi of Kathmandu, Sahara of Chitwan, and Sano Paila of Birgunj—were illegally transferred to fund Gorkha Media Network. Legal action has been recommended against the cooperative directors and all individuals involved in the decision-making process. Currently, Ramtel is in jail, and Rai is absconding.

The report emphasizes accountability for those involved, stating, “Every company has its own objective and spirit. Promoters and shareholders bear the main responsibilities. Those in the roles of shareholders, promoters, and managing directors cannot evade responsibility and accountability for the money received by the company.”

Lekhnath Dahal, a committee member, noted that funds from Suryadarshan and other cooperatives were transferred by Rai to Gorkha Media and were spent under Lamichhane's direction. Rai, the chairperson, and Lamichhane, the managing director, along with director Joshi, opened a joint account to handle the funds. During Lamichhane’s 14-month tenure as managing director of Gorkha Media Network, he signed all but one check. The committee also deemed Lamichhane’s 15 percent share in Gorkha Media as illegal.

The committee, which spent over three months compiling its findings, prepared a 2,000-page report following extensive interrogation, statements, research, and documentation. 

During the investigation, Lamichhane, a former Home Minister and chairperson of the Rastriya Swatantra Party (RSP), was interrogated for nine hours. He denied possessing or knowing the origin of the cooperative funds and claimed he should not be held responsible. He also asserted that he is not the Rabi Lamichhane who borrowed from the Suryadarshan and Supreme cooperatives.

RSP lawmaker Shishir Khanal, another committee member, indicated that while direct evidence of Lamichhane taking money from the cooperatives was not found, his involvement in spending those funds was clear. Khanal stated, “Lamichhane was MD, this is a fact. He has signed the checks in that capacity, so if signing the checks as MD creates legal liability, it should be borne.”

The report was unanimously approved by all committee members before being submitted to Parliament. Speaker Devraj Ghimire has instructed the government for necessary implementation of the report.

Formed by the House of Representatives on May 28, the committee was headed by CPN-UML lawmaker Surya Thapa, with members including Dilendra Prasad Badu from Nepali Congress (succeeded by Badri Prasad Pandey after Badu became a minister), Ishwari Neupane, Sabitra Bhusal from UML, Lekhnath Dahal from CPN (Maoist Center), Shishir Khanal from RSP, and Dhurba Bahadur Pradhan from Rastriya Prajatantra Party.

Committee Chair Thapa told Parliament on Monday that the cooperative sector is riddled with fraud, stating, “The cooperative sector is plagued by a multitude of fakes. Marriages, property sharing, and even debts are fabricated. Audit reports and working systems are falsified. General meetings and reports are manipulated. Shareholders and debtors, including public figures, have been falsely implicated.” He emphasized the need for all parties to address and resolve these issues within the cooperative sector.

Meanwhile, RSP Chairperson Lamichhane claimed that he was not involved in the case and that his party had dismissed the allegations against him. He said, “The time of the probe committee is over. If anyone has evidence against me, please bring it forward and explain it.”

Meanwhile, Prime Minister KP Sharma Oli informed the House of Representatives on Monday about his upcoming participation in the United Nations General Assembly. During the parliamentary meeting, Prime Minister Oli outlined the issues Nepal plans to raise at the assembly. The Nepali delegation, led by Prime Minister Oli, is scheduled to depart for the United States on Sept 20.

Monday’s parliamentary session resumed after the Maoist Center lifted its obstruction. Deputy Secretary General Shakti Bahadur Basnet, speaking on behalf of the Maoists, announced that the deadlock had been removed to advance key issues, including the Prime Minister’s foreign visit and the passage of important bills.

Basnet addressed the issue of the term ‘violence’, used by UML Secretary Yogesh Bhattarai in reference to Maoist insurgency during the Aug 28 meeting of the Parliament. Basnet criticized the term, stating, “We have taken the word ‘violence’ not as an unparliamentary term but as an insult to the sacrifices of the people. It is not merely a word but an attempt to undermine the entire process of Nepal’s revolution.” He also called for clarification on whether Bhattarai’s use of the term was a personal or party-related statement.

Basnet emphasized that labeling the Maoist armed rebellion as violence undermines the historical significance of political revolutions in Nepal. He questioned, “What about the Jhapa revolt? How do you label the 1951 revolution? Violence?”

The current session of Parliament has officially ended, with President Ram Chandra Poudel approving the recommendation of the Council of Ministers.