The arrest of former home minister Bal Krishna Khand on Wednesday hints of the involvement of a powerful political racket in the bribery scandal involving falsification of documents to send Nepali nationals to the United States as Bhutanese refugees.

As many as 12 persons have been arrested over the past three weeks in connection with the scam where racketeers, with the support of home ministry officials, allegedly swindled around 875 Nepali nationals of millions of rupees.

With several of their senior leaders implicated in the scam, Prime Minister and Maoist Centre chief Pushpa Kamal Dahal, Nepali Congress chief Sher Bahadur Deuba, and CPN-UML chair KP Sharma Oli have been meeting almost every day to discuss the investigation process.

The arrest of senior Congress leader Khand has dealt a severe blow to the party. Congress chief Deuba held a meeting with top party leaders on Wednesday evening to discuss the matter and chart out the party’s strategy on the issue.

“At the meeting, general secretaries Gagan Thapa and Bishwa Prakash Sharma demanded that Khand be suspended from the party’s central working committee. But no decision has been made,” a NC leader said, “the next meeting scheduled for Thursday may take a decision.”

Pressure is growing on the government from all sides to take action against all those involved in the scam.

Investigating officials said the case has become so serious that even the most powerful leaders and government officials cannot stop the probe now, given its wide-ranging nature.

Talking to the Post, Deputy Prime Minister and Minister for Home Affairs Narayan Kaji Shrsetha claimed that no politician has so far dared to request him to stop or delay investigation or shield their friends or acquaintances.

“The police are investigating the matter and they are expected to complete it in another seven or eight days,” said Shrestha. “We hope we will conclude the investigation and reach a conclusion.”

“No one has directly put any pressure [to stop the investigation]...but some indirect requests have been made and I have been ignoring them. The investigation has taken its course and will be completed soon. We have given the police full autonomy to impartially and credibly carry out the probe,” said Shrestha.

A team from the Kathmandu Police Circle arrested Khand from his residence in Mainjubahal, Kathmandu on Wednesday morning. Leaked audio circulating on social media appears to claim Khand’s wife Manju had accepted a bribe.

Soon after Khand’s arrest, the CPN-UML suspended its secretary and lawmaker Top Bahadur Rayamajhi, who has been absconding since last week after an arrest warrant was issued against him. On Wednesday, the party issued a public statement announcing his suspension while urging him to cooperate with the ongoing investigation.

From his undisclosed hiding, Rayamajhi on Wednesday informed the Parliament Secretariat that he was unwell and recuperating at a hospital.

But neither Rayamajhi nor his party, UML, has revealed any information about his condition or the hospital where he is allegedly admitted.

On Wednesday, police also arrested Narendra KC, who served as personal secretary to Khand when he was home minister. Police recorded his statement and obtained permission from the Kathmandu District Court to keep him in custody for investigations for four days.

Khand’s wife, Manju, has also gone out of contact, following her husband’s arrest, according to police. Khand served as home minister from July 12, 2021 to December 26, 2022.

“Earlier we arrested Tek Narayan Pandey who used to be the home secretary when Khand was home minister. And on the basis of his statement, we arrested Khand,” said a senior Nepal Police officer involved in the investigation.

In 2019, then government led by KP Sharma Oli had formed a committee under the then joint secretary Bal Krishna Panthi to recommend ways to manage the Bhutanese refugees who remain in Nepal following the cessation of the third country resettlement programme in 2016-end.

“It has been discovered that the original report prepared by the Panthi-led committee has disappeared from the ministry. This could not have happened without the support of the home minister and home secretary,” said the police officer. “Only a duplicate report that had been tampered with in certain sections was found at the ministry.”

When the committee was formed, UML chair Oli was the prime minister and Ram Bahadur Thapa, currently the party’s vice chair, was the home minister.

Only 429 Bhutanese refugees living in two camps in Jhapa and Mornag districts had applied as leftover refugees and asked the Panthi-led committee to include their names in the list of those to be resettled in third countries. The list was then verified by the UN refugee agency and the Refugee Coordination Unit based in Jhapa.

At the same time, the Panthi-led committee received applications from 875 people who wanted to be included in the list of leftover refugees. Since they were not verified refugees, the committee refused to accept their applications.

“Then a group of racketeers led by Keshav Dulal and Sanu Bhandari who are now in police custody, stole the committee report, removed the names of 429 verified leftover refugees and replaced them with another list of 875 persons,” the police officer said, adding, “Backed by the political and bureaucratic leaders, the racketeers added 18 pages to the report and circulated it to lure the people as evidence so that they believe that they are going the US as Bhutanese refugees.”

The racketeers had allegedly managed to steal the Panthi report with the help of home ministry officials including the then home minister Thapa’s security advisor Indrajit Rai.

In the meantime, there was a change in government following Oli’s ouster. Khand became the new home minister.

“Then the racketeers convinced him to form a new sub-committee to verify the new long list of refugees,” the police officer said.

The sub-committee was led by assistant chief district officer of Jhapa, Chomendra Neupane.

“The then home secretary Pandey kept on extending the deadline of the sub-committee as the racketeers created the new list of refugees,” the officer said.

But that sub-committee was derailed by controversy and the work was abandoned, said officials.

With the unearthing of the deep political and bureaucratic nexus, the United Nations refugee agency, UNHCR, has expressed its concern about the latest reports of Nepali citizens being duped and defrauded.

Saying that it welcomes the Nepal government’s investigation, it also notified in a statement that “the group resettlement program of refugees from Bhutan in Nepal ended on December 31, 2016 and will not resume again. UNHCR has consistently communicated about the end of the resettlement program.”

But there is a clear sign of uneasiness in the Congress and the UML over the ongoing investigation as some of their senior leaders have already been implicated in the case and more could be dragged in based on the statements provided by the racketeers.

Emerging from his meetings with Deuba and Oli, Prime Minister Dahal said there was no question of excusing anyone involved in such a serious case. “We have also instructed the police administration that no innocent person should be dragged into the case,” Dahal said.

“There has been an understanding at the level of top leaders that the culprits should not escape,” he said.

Deputy Prime Minister and Home Minister Shrestha met Oli whereby the latter is learned to have assured the UML’s support in probing the scam.

Emerging from the meeting with top party leadership, Shrestha said, “This is not an ordinary case of corruption. I asked for cooperation to punish all those who insult this country and undercut its self-esteem. Whoever is guilty should be punished. I also assured Oli-ji that no innocent person would be targeted.”

Similarly, speaking in the House on Wednesday, several parliamentarians, from Gagan Thapa, a Congress general secretary, to UML General Secretary Prithvi Subba Gurung, urged the government not to spare anyone involved in the scam.