When the government introduced an ordinance to criminalise loan sharking on July 5, 2023, many victims were hopeful that their property issues would be resolved. However, despite many protests, their woes and sufferings continue.

In ward 4 of Adarsha Kotwal Rural municipality of Bara district, Satyaranayan Prasad Yadav purchased a plot of land registered under the name of Arun Kumar Singh, originally from Hathiyaul, Sarlahi, now residing in Birgunj. The land covering an area of 4 bigha and 15 kattha [3.22 hectares] under plot numbers 142 and 370, was purchased on 28 March 2017. Satyaranayan found himself short of Rs5 million during the purchase. To cover the shortfall, he borrowed the necessary funds from Rambharos Yadav of ward 23 of Birgunj Sub Metropolis, under the condition that he would register the purchased land and issue two promissory notes, each worth Rs3 million.

Accordingly, to avoid paying extra taxes, Satyaranayan chose not to transfer the ownership of 2 bigha and 10 kattha of land (plot number 370) [1.69 hectares] into his name. Instead, he registered the land as collateral directly in the name of Rambharos’s wife Rosani Devi and issued the promissory notes. Soon after obtaining the loan, Satyaranayan deposited Rs4 million into the account of the original landowner, Singh, at the Rastriya Banijya Bank.

For the next seven years, the land remained in Rosani Devi's ownership due to Satyaranayan’s failure to repay the loan. The situation worsened during the coronavirus pandemic, as the interest on the loan increased, leading to disputes over repayment. Coincidentally, a year ago, the government acquired the land to build a substation for the Nepal Electricity Authority, offering Rs5 million per kattha, totalling Rs25 million. The amount further increased the greed of Rambharos, the moneylender. Despite Satyaranayan’s willingness to repay the Rs5 million loan with reasonable interest, Rambharos refused to return the land, prompting Satyaranayan to file a complaint with the loan sharking investigation committee. Multiple discussions ensued, but no resolution was reached.

“The lender neither returned the land nor did the police file a case,” Satyaranayan stated. “I have all the necessary documents proving my purchase of the land.” He claims to possess written statements from the previous landowner’s wife, Poonam Singh, documents from the ward office confirming his ownership, and other evidence like bank vouchers. However, despite having these documents, the police did not file the case. “I have been pleading for justice with the chief district officer, superintendent of police, and even the home minister for over a year to have my land returned.”

Adding to his woes, Satyaranayan reported that Rambharos had already won a case related to one of the Rs3 million promissory notes, with the process of compensation recovery underway. Satyaranayan expressed his frustration, stating that even though he was ready to repay the loan with appropriate interest, the land was not returned. He complained that despite signing documents at the police station to return the land, Rambharos did not fulfil the agreement. “I don't understand why they refuse to file the case when there is substantive evidence of the loan and the collateral land,” he said.

Rambharos is a well-known moneylender in Birgunj, notorious for his loan-sharking practices. He argues, “I didn’t obtain the land from Satyaranayan but from Arun Singh. Satyaranayan has nothing to do with it.” He also mentioned that he had secured a prohibition order and a mandate from the high court to prevent his arrest and claim compensation for the acquired land.

Satyaranayan’s case is just one of many in the Madhesh region, where numerous victims have fallen into the trap of loan sharks. Yet, despite the existence of laws, no significant legal action has been taken against any perpetrator. After the ordinance on May 3, 2023, which later became law against unfair transactions, the first phase saw 3,322 complaints registered in Bara District. Interestingly, police records show that 1043 cases were resolved by July 15, 2024.

The resolved cases helped the moneylenders get Rs215,627,606 in return for handing back 30 bigha, 17 kattha, and 17 dhur of land [20.92 hectares] to the debtors. The administration finds the case complicated as, in some instances, a single debtor had filed complaints against more than 20 moneylenders, and in other cases, more than 20 victims had lodged complaints against a single lender.

“There are plenty of dishonest people out there, whether lenders or debtors, even after the law was enforced,” a police officer involved in mediating disputes between lenders and debtors remarked. “Both sides often present fabricated narratives to serve their own agendas, making it difficult to identify the true victims.” Mahendra Khadka, superintendent of police, said that despite registering three cases under unfair transactions, the investigation could not proceed as the court did not grant permission for arrest. “The court denied arrest warrants citing the subject and nature of the cases appear too similar.”

However, the police allegedly take money from both the sharks and the victims and settle the cases in the perpetrators’ favour.

“Sometimes, the police pressure victims for compromise and refuse to register cases despite having substantial evidence for suing,” a police officer said requesting anonymity.