Swift, Decisive Action A Must

The ongoing crackdown on individuals involved in the cooperative savings scam has raised the likelihood of Rabi Lamichhane, Chair of the Rastriya Swatantra Party, being apprehended at any time. A parliamentary investigating panel, formed to probe cooperative fund scams related to Gorkha Media Network Pvt. Ltd. presented a report shedding light on a massive money heist in the form of cooperative fund embezzlement, prompting current administration to speed up action against those involved in the heist, including Lamichhane, some of his party members and others.

After finding that he had misappropriated cooperative savings as the managing director of the Galaxy 4K Television operated by Gorkha Media Network, the authorities are all set to arrest Lamichhane, whose spectacular rise to the nation’s political landscape and his political clout has taken everyone by surprise. Authorities have apprehended Chhabi Lal Joshi, a partner of Lamichhane in the Gorkha Media Network, demonstrating the government’s dedication to resolving the cooperative savings heist. The probe body discovered that the savings of depositors in approximately 258 cooperative organisations have been misappropriated. While 669 fraudsters have been apprehended, 1540 of these swindlers are still on the loose.

Legal action

Apart from pursuing legal action against well-known perpetrators, the inquiry panel suggested that authorities take measures to prosecute approximately 50 individuals connected to cooperative scams. Out of them, 20 people, including Gitendra Babu (GB) Rai, the mastermind behind cooperative swindling are held accountable for the embezzlement of millions of rupees in the cooperative savings. While Rai is in Malaysia, others have sought refuge in different countries to avoid punishment. The extent of the cooperative scandal in the nation is significant and poses a serious issue. In the meantime, Dhan Raj Gurung, the Deputy President of Nepali Congress, is facing legal consequences for his role in cooperative fund embezzlement, alongside his wife. People claim he arranged a fake divorce with his wife to escape punishment.

Indeed, the parliamentary probe body’s findings are alarming: they discovered that approximately Rs. 87.89 billion had been embezzled, with Rs. 71.30 billion being taken from the savings of ordinary citizens. The role of Lamichhane, a former Deputy Prime Minister and Home Minister, in the misuse of funds as managing director of the Galaxy 4K Television has caused ripples across the nation. Meanwhile, the parliamentary probe panel report revealed that various cooperative organisations unlawfully transferred Rs 655.4 million to Gorkha Media, with Rs 224.6 million being deposited directly into the company’s account. As per the same report, many cooperative operators, officials and others siphoned off a whopping Rs 87.89 billion.

Lamichhane, however, denied any involvement in the scandal, claiming ignorance of the fund transfers to the company’s account. He blamed GB Rai for all fund transfers. However, the parliamentary inquiry committee’s report painted a different picture. They moved large sums of money into their company’s accounts violating legal provisions that prohibit cooperative funds from being transferred to individuals or private entities. Though the probe committee did not find Lamichhane receiving cooperative money directly to his bank accounts, the report cited his involvement in issuing cheques worth millions of rupees to transfer or pay funds from the company’s account. He even paid his in-laws for the purchase of now defunct FM operated by them. Some argued the Gorkha Media Network was established with the seed money coming solely from different cooperative firms run under the GB Rai’s chairmanship.

RSP leaders, including Lamichhane and his supporters, berated the Nepali Congress and other leaders, citing that they ‘falsely’ claimed that Lamichhane took money directly from cooperatives. His backers insisted he received a “clean chit” from the parliamentary investigative body, asserting that his lack of physical involvement should absolve him of guilt. However, this defence did not hold water after the committee’s findings scrutinized it. According to cooperative regulations, it is not permissible to transfer funds from cooperatives to media-related institutions or use them for purposes that do not benefit their members. 

Worthwhile to note here is the fact that cooperative scam encompasses more than just Rabi Lamichhane or Gorkha Media. The parliamentary inquiry committee was assigned to investigate fraud allegations in numerous cooperative organisations, many of which have deceived their members. Although Lamichhane’s case has garnered a lot of attention, the bigger problem lies in the widespread corruption within the cooperative sector. This has shattered the dreams of ordinary people who believed their hard-earned wages were being invested for the future. Farmers, women, elderly citizens, and everyday labourers who relied on these cooperative organisations with their life savings are now feeling betrayed. Many of victims are now unable to pay for medical treatment or education for their children, leading to bankruptcy.

Justice

Victims have been doubly affected by the government’s delayed actions, amplifying their suffering. It’s surprising to witness our concerned departments remain inactive while billions of rupees were being stolen. Despite the government’s arrest of multiple guilty operators and officials of cooperative organisations, there are concerns that justice delays might prevent people from recovering their money. Without quick and decisive action from the state, the cooperative movement and public confidence in Nepal’s financial institutions could be compromised.

Cooperative organisations, which are built on the ideals of mutual assistance and community upliftment, have long been recognised as vital pillars of economic and social progress. Cooperatives have played a key role in transforming lives, creating opportunities, and enhancing well-being across the globe. Nepal’s cooperative movement, spanning almost seven decades, has been no exception. However, the recent revelations of widespread fraud and embezzlement within the cooperative sector, including accusations against prominent figures like Rabi Lamichhane, has posed a threat to the trust that these institutions are built upon.

The government must act to restore faith in Nepal’s cooperative movement. The victims of this scandal deserve justice, and we must hold the perpetrators accountable, regardless of their political or social standing. Beyond immediate legal action, the government must also take steps to strengthen regulatory supervision of cooperatives, ensuring that such abuses cannot happen again in the future. 

(The author is a former managing editor of this daily)