NEPALGUNJ: Tulsipur High Court has ordered pretrial detention for three individuals, including the founding chairperson of Karnali Development Bank, in connection with a multi-billion-rupee financial scam that rocked the bank headquartered in Nepalgunj.
The court ruling, issued by a joint bench of Justices Chandra Bahadur Saru and Poonam Singh Chand, followed a hearing on the high-profile embezzlement case that implicates 109 individuals in total.
Among those sent to judicial custody are founding chair Rajendra Bir Raya, former chairman Pashupati Dayal Mishra, and the bank’s former head of finance, Bed Prakash Singh Thakuri.
Former Nepal Rastra Bank employee Bhuvan Basnet was granted release on a bail of Rs 200,000. However, court spokesperson Bal Bahadur Bista clarified that Basnet has been temporarily held in custody due to his inability to immediately furnish the bail amount.
The court has also instructed that a summons be issued to over 100 co-defendants who remain at large. According to court officials, the decision to remand the three key accused in custody was made to prevent potential interference with the ongoing judicial process, given the gravity of the allegations and their positions within the bank.
The Central Investigation Bureau (CIB) of Nepal Police had earlier submitted its findings to the District Government Attorney’s Office on July 30, recommending prosecution of the accused for misappropriating a staggering Rs 3.2 billion from the bank. The CIB named 109 individuals in its final report, most of whom are still evading arrest.
Based on the CIB’s recommendation, the government attorney filed a formal case at the High Court, alleging systematic embezzlement and gross financial misconduct within the bank’s top leadership and operations.
Of the total alleged embezzled amount, the largest individual liability has been claimed from founding chair Rajendra Bir Raya, with Rs 2.63 billion in damages and penalties sought. Raya is also a central committee member of the CPN-UML.
Former chairman Pashupati Dayal Mishra faces claims amounting to Rs 824.6 million, while former finance department head Bed Prakash Singh Thakuri has been charged with responsibility for losses totaling Rs 463.9 million. Meanwhile, former Rastra Bank staffer Bhuvan Basnet is accused of causing Rs 100.8 million in losses.
The scandal, one of the largest in Nepal’s banking sector, has raised serious concerns about regulatory oversight, institutional corruption, and political protection within financial institutions.2
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