High-level panel grills Oriental chief BasnetThe Problematic Cooperatives Management Committee has started grilling Oriental Cooperative chief Sudhir Basnet over the misappropriation of billions in deposits besides freezing his assets. Basnet has served one year out of the two-year jail sentence he was awarded after being convicted of fraud.
The Problematic Cooperatives Management Committee has started grilling Oriental Cooperative chief Sudhir Basnet over the misappropriation of billions in deposits besides freezing his assets. Basnet has served one year out of the two-year jail sentence he was awarded after being convicted of fraud.
Two months ago, the government formed a high-level committee led by former judge Gauri Bahadur Karki to take over Oriental Cooperative, evaluate the assets and liabilities of troubled savings and credit cooperatives and compensate depositors.
Tika Budhathoki, one of the members of the high-level panel, said they interrogated Basnet two weeks ago. “Basnet claimed that he had fixed assets worth Rs12-14 billion and liabilities worth Rs8 billion,” Budhathoki said. “During the interrogation, Basnet also handed over the details of his properties.”
Basnet reportedly owns 14 housing colonies and apartment buildings and hundreds of ropanis of land in the Kathmandu Valley.
They include Oriental Colony, Chakrapath Heights at Basundhara, Dhumbarahi Apartments Phase 2, Bagmati Apartment at Sankhamul, Eastern Apartment at Kausaltar, Vegas City at Balkumari, Imperial Apartment at Naxal and Sanepa Height Apartment, among others.
Many people who had bought apartments from Oriental Builders and Developers and companies affiliated to it had complained that the firm had collected advance payment from them but failed to deliver the flats.
After collecting details about Basnet’s property, the high level panel has asked the concerned land revenue offices and the banks through which Basnet carried out his financial transactions to freeze his assets.
As per the panel, Bank of Kathmandu, NIC Asia Bank and Nepal Credit and Commerce Bank were found to have issued loans to Basnet.
Budhathoki said they planned to make field visits to Basnet’s real estate properties. “We want to ascertain the status of Basnet’s properties by making field visits.”
Oriental Cooperative went bankrupt in 2013 after disbursing loans haphazardly and allowing its key promoter, Sudhir Basnet, to illegally invest depositors’ funds in the real estate market which later crashed.
These malpractices and financial irregularities inflicted losses of around Rs5.2 billion, including Rs3.9 billion in principal, on Oriental’s depositors. A three-member high level commission formed around two years ago to probe troubled savings and credit cooperatives had found that Basnet owed Rs1.36 billion to homebuyers who had booked housing units or apartments.
The commission, formed under former chairman of the Special Court Gauri Bahadur Karki, had received 12,778 complaints against troubled cooperatives, of which 11,286 were against Oriental.
The government’s recent move to take over the cooperative is expected to provide relief to the depositors. According to the panel, it has received a large number of complaints against 144 problematic cooperatives in total.
Budhathoki said the committee would be calling for reapplications as per the template developed by the panel. “As we suspect that the claims in the previous applications have been inflated, we want to find out the actual number of depositors and the losses they have suffered,” said Budhathoki. He added that the panel would assess the properties of other problematic cooperatives after settling the liabilities of Oriental Cooperative.
Co-op conference slated for April
KATHMANDU: The second National Cooperative Congress is all set to kick off on April 4. A total of 1,000 participants from the cooperative sector will be taking part in the two-day conference. The meet is being organised by the National Cooperative Federation in association with the Ministry of Cooperatives.
According to the federation, leaders of the cooperative movement from India, China, Japan, South Korea, Malaysia, Singapore, Sri Lanka and Pakistan will be sharing the best management practices of cooperatives at the event. (PR)