Police arrested disgraced real estate tycoon Sudhir Basnet, who had misused millions of rupees collected from the public and evaded prison sentences, from his residence in Dhapasi late Tuesday night. 

Basnet, who had embezzled funds collected from people to build apartment buildings and fled without repaying a debt of Rs1.6 billion acquired from 14 financial institutions, was arrested as he had failed to serve jail sentences handed down by different courts, said Superintendant of Police Pradhumna Karki, acting chief of Kathmandu Metropolitan Police Range.

Kathmandu District Court, which found him guilty of fraud on March 29, had sentenced Basnet to two years in jail and slapped a fine of Rs59.2 million. In other case filed at the same court, he was handed a six-month prison sentence along with a fine of Rs494,000. This verdict was issued on July 14.

Bhaktapur District Court, on November 23, 2015, had also sentenced Basnet to two years in prison and slapped a fine of Rs84,648.

Basnet had evaded these court sentences by fleeing to India. However, police had lately been tipped about his return to Kathmandu. Based on this information, they raided his house at around 11pm on Tuesday and arrested him.

Once one of the most influential players in the domestic real estate market, Basnet's woes began when his entire business was affected after the burst of the real estate bubble. Around that time, the central bank also tightened real estate lending, dealing a blow to those engaged in real estate business.

In his heydays, Basnet had promoted about two dozen housing and apartment projects. However, almost half of them-including 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-have not been completed. 

A three-member high level commission formed around two years ago to probe into troubled savings and credit cooperatives had found that Basnet owed Rs 1.36 billion to homebuyers, who had booked housing units or apartments at projects promoted by him. 

The commission had also found that Basnet had not reimbursed a big chunk of Rs 5.5 billion in deposits parked by individual depositors at Oriental Cooperatives, another business promoted by Basnet.  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.

Many cooperatives like Oriental are operating like banks and have created quite a large customer base. But because of lack of discipline and strong regulatory body many have failed to fulfill their primary responsibility of protecting the interest 

of depositors.