Nepal High Court sends former Home Minister Rabi Lamichhane to jail in cooperative scam case

KATHMANDU: A High Court in Nepal has ordered former Home Minister Rabi Lamichhane to be sent to jail in a cooperative scam case. The Butwal bench of Tulsipur High Court, late on Friday evening, ordered Lamichhane to be sent to jail, overturning the decision of the District Court of Rupandehi.

On Friday evening, a Joint bench of judges, Ramesh Dhakal and Swikriti Parajuli, ordered Lamichhane to be remanded in custody. Likewise, the bench upheld the decision of the district court to send former Deputy Inspector General (DIG) and ex-director of Gorkha Media Network, Chhabilal Joshi, to judicial custody.

“The order was given by the bench of Ramesh Dhakal and Swikriti Parajuli annulling the verdict of the District Court Rupandehi to release him in bail”, confirmed deputy registrar Harigopal Gyawali over phone.

On January 26, the district court released Lamichhane on bail of NRs 10 million on the condition that he appear on the scheduled dates. Lamichhane later moved the high court, challenging the lower court’s order. At the time, the court had stated, “Given that there is no reasonable basis to believe the defendant did not commit the alleged crime based on the immediately available evidence, the matter will be further examined during the trial.”

Later, the District Government Attorney’s Office appealed to the high court, seeking to overturn this order. It argued that Lamichhane should remain in custody due to the seriousness of the charges and the evidence against him. On Friday, all three cases were heard together.

The former Home Minister and the founder of the Rastriya Swatantra Party (RSP) has been facing cases involving cooperative scams in Kathmandu, Kaski, Butwal, and Chitwan.

Cases have been lodged against Lamichhane in Butwal (Supreme Cooperative), Chitwan (Sahara Cooperative), Kathmandu (Swarnalaxmi Cooperative), Kaski (Suryadarshan Cooperative) and Parsa (Sano Paila Cooperative). In all the districts, Lamichhane has been accused of diverting deposits to Gorkha Media Network, which ran the now defunct Galaxy 4K Television.

Lamichhane was arrested from his party office in Kathmandu on 18 October 2024 by a team from the Central Investigation Bureau on charges of organized crime and misappropriation of cooperative funds. The former Home Minister and founder of RSP, the fourth largest party in the parliament, has denied the charges of charges of money laundering, cooperative fraud, and organized crime.

In 2024, a special inquiry by a parliamentary committee formed to investigate the cooperative scam, which prepared and tabled a report in the parliament on September 16, 2024, indicted Lamichhane for embezzling millions of rupees as part of the cooperative scam.

The seven-member committee formed on May 28 last year was tabled in the parliament and was formally endorsed by the house session. The report concludes that millions of rupees injected into Gorkha Media came from cooperatives that traded on the basis of forged documents.

Former Home Minister Lamichhane worked as managing director in Gorkha Media, the parent company of now-defunct Galaxy 4K Television, when cooperatives’ savings were invested, violating cooperative legislation. The incumbent parliamentarian also clarified that he was engaged in Gorkha Media, taking a sweat share.

Later in 2022, Lamichhane entered politics, announcing the formation of Rastriya Swatantra Party, and entered the federal parliament as a parliamentarian contesting the election the same year. The television station, which failed to pay its staff, shut down its formal operations last year.

The committee’s report also recommended that the government take legal action against everyone involved in the transfer of money to Gorkha Media from various cooperatives. Millions of rupees were inducted into Gorkha Media from various cooperatives: Suryadarshan from Pokhara, Supreme from Butwal, Swarnalaxmi from Kathmandu, Sahara Chitwan from Chitwan, and Sanopaila from Birgunj.

The report claimed that the embezzlement was completed with the active involvement of GB Rai, Kumar Ramtel, Rabi Lamichhane (then managing director), and Chhabi Lal Joshi. Rai and Lamichhane operated a joint account in the bank and issued cheques amounting to millions, which shows his involvement, the committee report includes.

“Every company has its own objective and spirit. Promoters and shareholders are the main responsibilities of such institutions. Those in the role and responsibility as share-holders, promoters and managing director cannot be allowed not to be responsible and accountable for the money received by the company,” the report stressed.

During the investigation, the committee also held an inquiry session with former Home Minister and incumbent Chairperson of Rastriya Swatantra Party (RSP) Lamichhane for over 10 hours. Throughout the session, he claimed to be unaware that the transfers that were made to the Gorkha Media originated from cooperatives, that too, savings of about 50,000 people.

Further arguing over the case, Lamichhane also claimed that Rabi Lamichhane, who had borrowed money from Suryadarshan and Supreme Cooperatives, was also someone he did not know. The committee had asked him a set of 50 questions about his alleged involvement in the scam.

Following the tabling and endorsement of the report, House Speaker Devraj Ghimire directed the government to implement the report of the parliamentary special inquiry committee formed to investigate the misappropriation of savings of cooperatives. Speaker Ghimire then directed the Parliament Secretariat to send the report to the government for implementation.

The House of Representatives (HoR) formed the committee headed by CPN-UML lawmaker Thapa on May 28, 2024, after the Nepali Congress demanded the formation of a parliamentary investigation committee, saying Rastriya Swatantra Party President Rabi Lamichhane, who was then deputy prime minister and home minister, was involved in the misappropriation of cooperative savings. The HoR had initially given the committee three months and later extended its tenure by 15 days.

Dilendra Badu of Nepali Congress, Ishwari Neupane, Sabitra Bhusal of UML, Lekhnath Dahal of CPN (Maoist Center), Shishir Khanal of RSP, and Dhruba Bahadur Pradhan of Rastriya Prajatantra Party were members of the parliamentary committee. (ANI)