The Kathmandu District Government Attorney’s Office filed a sixth case under the Insurance Act against Deepak Bhatta and 17 others at the Kathmandu District Court on Thursday.

Bhatta’s group is already facing money laundering charges at the Special Court and other cases, including those under the Insurance Act, at the district court.

The latest charge sheet, filed on the basis of a letter from the Nepal Insurance Authority, names 18 defendants, including former authority chair Surya Prasad Silwal and former Federation of Nepalese Chambers of Commerce and Industry president Shekhar Golchha.

The charge sheet alleges that shares in Himalayan Re-Insurance were manipulated, the state suffered financial losses and money was systematically misappropriated. It claims that eight stages of transactions were used to commit offences under the Insurance Act and money laundering laws.

In the first stage, Rs280 million was withdrawn as an advance from Himalayan Re-Insurance. In the second, Rs239.2 million was allegedly paid to Alliant Insurance Brokers through false accounting entries.

The third stage involved the transfer of Rs211.5 million from Alliant’s dividend proceeds, while the fourth allegedly involved the misuse of an income fund to transfer Rs239.2 million to Anjana Nepal’s bank account.

In the fifth stage, a further Rs211.5 million was deposited into Nepal’s account as dividend income. In the sixth, Rs211.5 million was transferred from a Mahalakshmi Bank account to Ayushma Bhatta’s account at Siddhartha Bank.

In the seventh and eighth stages, the charge sheet alleges, Rs211.5 million was transferred from Ayushma Bhatta’s account to Deepak Bhatta’s account in each transaction, bringing the total to Rs423 million.

The prosecution alleges that Bhatta systematically misappropriated and misused funds belonging to Himalayan Re-Insurance and other insurance companies and their subsidiaries for personal gain.

According to the charge sheet, Bhatta established Alliant Insurance Brokers Pvt Ltd in the name of his mother-in-law, Anjana Nepal, while allegedly retaining beneficial ownership of the company. The company was used to channel insurance and reinsurance funds into transactions and share investments, with the resulting dividends ultimately accruing to Bhatta, the charge sheet alleges.

The prosecution has sought recovery of the alleged losses, fines and prison sentences for the defendants on charges of misappropriating insurers’ funds, related offences and money laundering.