Rabi Lamichhane, former Home Minister, Chairman of RSP, and Managing Director of Gorkha Media Network, has been found guilty of financial misconduct involving the embezzlement of cooperative deposits.
A special inquiry committee was formed on May 28 to investigate the embezzlement of deposits in dozens of cooperatives across the country. The Nepali Congress had been obstructing parliamentary proceedings, demanding an investigation into cooperative embezzlements, including those involving various cooperatives connected to GB Rai, Chairman of Gorkha Media Network, and Rabi Lamichhane, due to their business partnership.
After a thorough three-month investigation, it was revealed that Rabi Lamichhane was aware of the alleged transfer of millions of rupees from various cooperatives during his tenure as Managing Director of Gorkha Media Network. Although Lamichhane had consistently denied any involvement in the cooperative frauds—both publicly and to the investigation committee—the gathered evidence strongly suggested otherwise. Despite his claims of being unaware of Gorkha Media’s financial activities, the committee uncovered key documents, such as signed bank statements, audit reports, and cooperative records, that demonstrated his direct role in transferring cooperative funds into Gorkha Media’s accounts.
Findings of the Parliamentary Investigation Committee:
The Parliamentary Investigation Committee uncovered that 650 million rupees were embezzled from five cooperatives, including Suryadarshan Cooperative. The funds were reportedly transferred illegally to Gorkha Media Network Pvt. Ltd. The committee has recommended legal action against four individuals, including Rabi Lamichhane, the then Managing Director of Gorkha Media. Alongside Lamichhane, Gitendrababu (GB) Rai, Kumar Ramtel, and Chabilal Joshi have been identified as key figures involved in the misappropriation and are now facing prosecution. GB Rai has been evading arrest, and an INTERPOL notice has been issued against him.
The committee has also made a series of recommendations to reform the cooperative sector and prevent future financial misconduct, such as requiring pre-training for individuals before registering a cooperative organization. If the government is unable to provide such training, private sector training providers should be authorized to step in. Additionally, the committee has called for the establishment of maximum savings and loan limits within cooperatives, with strict enforcement to ensure compliance.
Another proposed reform is the creation of a Cooperative Authority, an autonomous body tasked with regulating, supervising, and taking action against cooperatives that violate laws. The authority would work closely with the Ministry of Cooperatives and Nepal Rastra Bank (NRB), functioning as a second-tier institution. The committee also recommended categorizing cooperatives into A, B, and C based on their financial capacity and implementing annual audits.
To address the ongoing crisis in the cooperative sector, the report suggests the establishment of a Credit Information Center, Savings Insurance, and a Debt Recovery Tribunal. These institutions, currently available to banks and financial institutions, would be adapted to cooperatives to ensure financial transparency and safeguard depositors. Furthermore, the committee has called for freezing the assets of cooperative directors involved in the scandal, including their real estate, bank accounts, and travel permits. This measure aims to prevent further financial losses while the case is under investigation.
For cooperatives declared distressed, the report suggests forming a dedicated team of banking and cooperative experts to manage the winding-up process. This team would be responsible for recovering savings and managing the distribution of assets, with priority given to small savers. The committee also proposed issuing government-guaranteed bonds to return small savers’ funds, with plans for the government to recover these amounts later.
The inquiry has also highlighted the illegal transfer of cooperative funds to private companies, particularly Gorkha Media Network Pvt. Ltd. The report calls for strict legal action against all those involved in these transactions. GB Rai, Kumar Ramtel, Rabi Lamichhane, and Chabilal Joshi have been held accountable for the misuse of cooperative savings during their tenure at Gorkha Media, and the committee has urged the government to prosecute them under existing laws.
The committee also concluded that the office bearers of Gorkha Media Network used forged documents when transferring shares of the company, and it suggested the government further investigate the matter and take necessary action. The report, prepared and approved unanimously by the committee, was submitted to the House after consultation with Prime Minister KP Sharma Oli on Sunday.
The Thapa-led seven-member committee includes Sarita Bhusal of the UML, Ishwori Devi Neupane and Dilendra Prasad Badu of Nepali Congress, Lekhnath Dahal of the CPN (Maoist Centre), Shishir Khanal of the Rastriya Swatantra Party, and Dhruba Bahadur Pradhan of the Rastriya Prajatantra Party as members.
Speaking to the media after yesterday’s parliamentary meeting, Rabi Lamichhane said, “The objections I faced earlier have been completely dismissed today. I am not involved in the misappropriation of any cooperative, so I don’t have to take responsibility for the money that came from it. However, as the Managing Director of Gorkha Media Network, I need to be legally responsible for its internal management, as per the report.” He also thanked the committee.
Legal Implications and Next Steps:
Legal experts have noted that if unethical behavior is found during a parliamentary inquiry, appointments can be rejected, though imprisonment or fines are not typically required unless a criminal offense is discovered.
According to a lawyer and Supreme Court advocate Kirtinath Sharma Paudel, “If an individual is found to have acted unethically during a parliamentary hearing, their appointment will be rejected. Legally, there is no requirement for imprisonment or fines unless a criminal offense is committed or discovered later, in which case legal action can be pursued under the applicable laws.
In the case of Rabi Lamichhane, his fraud case was not pursued while he held the position of Home Minister, though similar cases against others were prosecuted. Initially, the Parliamentary Committee declined to take action against him. However, the Committee’s recent report has now found him culpable, opening the door for legal proceedings. This development also enables the police to arrest Rabi Lamichhane, and the prosecution process can move forward, including the filing of a supplementary charge sheet.”
