Oriental Cooperative former Chair Sudhir Basnet/File
KATHMANDU: The Oriental Cooperative Limited, which was announced crisis-ridden twice by the Cabinet on September 23, is found to have embezzled some Rs 10.84 billion of its members.
According to the Problematic Cooperative Management Committee’s Office, the Oriental Cooperative had amassed the savings over Rs 10 billion through its nine branches across the country and misappropriated the deposits.
The Cooperative was first declared problematic on November 6, 2017 after it went bankrupt.
According to Office Chief Keshab Prasad Poudel, 7,646 members approached the Office demanding its facilitation to get back their deposits.
The Cooperative also faced a case at the Supreme Court for the ‘misappropriation’ of the collections.
Responding to the case, the apex court on February 23, 2020 ordered the organization to address the issue. But the implementation of the court verdict is still awaited.
After the organization was not serious towards addressing the issue, the Ministry of Cooperatives on September 23, 2022 declared it ‘problematic’ second time.
Following the declaration, Cooperative former Chair Sudhir Basnet has been arrested for discussions.
During the conversation, Basnet mentioned his association with ‘Kohinoor Hill Saving and Credit Co-operative Limited’, ‘Consumer Savings and Credit Cooperative Ltd’, and the ‘Vegas Savings and Credit Cooperative Ltd’ which are already identified as ‘problematic’ by the government.
So far, the Cooperative is found to have collected the deposits by establishing its branches in Nepalgunj, Pokhara, Dang, Surkhet, Kathmandu, Biratnagar, Itahari, Bhaktapur and Lalitpur.
The government assesses 12 cooperatives as ‘problematic’.
Cooperatives declared problematic by government
The Cooperatives declared crisis-stricken by the government are Standard Savings and Credit Cooperative Limited, Prabhu Saving and Loan Cooperatives Limited, Consumer Savings and Loan Cooperatives Limited, Standard Saving and Credit Co-operative Limited, Standard Multipurpose Cooperative Limited and Lu:Niva Multipurpose Cooperatives Limited.
Likewise, Pacific Saving and Investment Cooperative Limited, Kohinoor Hill Saving and Credit Cooperative, Kuber Saving and Loan Cooperative Limited, Begas Saving and Loan Cooperatives, Societal Saving and Loan Cooperative Limited were also declared troubled by the government.
The Office has been managing the Cooperatives declared crisis-ridden by the government, said Office Chief Poudel, who is also member-secretary of the Committee.
Most of the depositors doing transaction with the problematic cooperatives have been refunded except for Oriental’s.
Legal recourses were being taken against the troubled cooperatives to refund the remaining depositors at the earliest, Poudel shared.
Most of the money trapped in the troubled Cooperatives is of retired employees, shared Tejnath Pokharel, branch officer of the Committee.
Shopkeepers saving their incomes in the Cooperatives without acquiring additional information about the Cooperatives were also duped.
Problematic Cooperative Management Committee Office had issued a 15-day notice on November 7 in the name of Board Members of the Cooperatives, debtors, managers and employees of the Cooperatives declared crisis-stricken by the government to pay the loan and interest of the liabilities to the depositors and members within 15 days.
The latest 15-day notice was published after the repeated communication and correspondence with the concerned authorities in the cooperatives were not responded to.
Notices were published in the national-level media, shared Poudel, adding that those Cooperatives’ operators, debtors, managers and employees not paying interest within 15 days will be brought to book, the Office said.