The Central Investigation Bureau (CIB) on Wednesday arrested Sujin Shakya, also known as Sujen, the head of the remittance division at Prabhu Bank, for his alleged involvement in banking offences.

Additional Inspector General of CIB Manoj KC said that Shakya was taken into custody from Ikhantse, Lalitpur-11, on the basis of an arrest warrant issued by the Patan High Court. He has been placed under investigation.

Police said Shakya is suspected of allowing a group with vested interests to use funds improperly for an extended period, even after remittance operations handled by Prabhu Management Pvt Ltd had been suspended. The alleged misconduct, in violation of Nepal Rastra Bank directives and banking regulations, is believed to have caused losses amounting to Rs893,19,986 to the bank.

“CIB officials are also investigating Prabhu Bank CEO Ashok Sherchan in connection with the case,” Senior Superintendent of Police Shiva Kumar Shrestha said.

Earlier, on October 28, the bureau had arrested Prabhu Group chairman and former UML lawmaker Deviprakash Bhattachan in connection with the same investigation.

Preliminary findings indicate that legal provisions allowing pre-funding for remittance were misused, enabling the disbursement of billions of rupees in the name of pre-funding. No interest was collected as required, resulting in additional losses exceeding Rs1 billion, he added.

The investigation is ongoing.