UML leader's son allegedly embezzles 13 million rupees in Jhapa

Biratnagar, September 21 — With ongoing reports of cooperative fraud, the Unnati Savings and Credit Cooperative in Jhapa's Shivasatakshi Municipality-3 has been found to have irregularities amounting to nearly 15 million Nepali Rupees involving depositors and share members.

The cooperative's chairperson, Suman Khanal, has allegedly embezzled 13,836,770 Nepali Rupees. Khanal is the son of Radhakrishna Khanal, an elected UML member of the Provincial Assembly from Jhapa Constituency 4 (1).

Before the elections in December 2022, Khanal appealed to the public, claiming he would return the money if elected: "Your money will not be lost; support me, and I will return it."

However, after winning the election, he failed to return the funds, leading the victims to file complaints with the municipality's cooperative branch. Section officer Badri Dahal confirmed that they have referred the case to the District Police Office for investigation.

"We have received a complaint and have recommended necessary actions to the District Police Office," Dahal stated.

Following the referral, victims report that Suman has gone missing and is unreachable. District Superitendent of Police (DSP) of Jhapa Milan KC stated that the investigation is ongoing and results will be available soon.

A few months ago, locals summoned Khanal to the local police office, where he allegedly signed documents claiming sole responsibility for the funds with no involvement from others.

"Twenty-two days ago, a complaint was lodged. We are in the process of investigating and will provide results soon," DSP KC said. Meanwhile, the chair of the cooperative's accounting committee, Suman Katuwal, revealed that he has also been a victim of Khanal’s fraud, losing more than 1.1 million Nepali Rupees.

A few months ago, locals summoned Khanal to the local police office, where he reportedly signed documents stating he was solely responsible for the funds.

One victim stated, "It appears there was embezzlement within the scheme." They claimed he promised to repay by selling land: "He said he would sell two kathas of land in Mangalbare and twelve kathas of farmland in the village."

Khanal's fraud

Khanal is also the founding chair of the cooperative. Reports from the fiscal year 2021-2022 indicate that he misappropriated 70,000 in share amounts under a committee led by ward chair Bhaskar Neupane.

According to the same report, Khanal withdrew 206,868 Nepali Rupees from depositors' funds without proper documentation. He is accused of misappropriating 4.2 million in cash and transferring 236,840 Nepali Rupees from the cooperative’s fund to his personal savings account.

In fiscal year 2021-2022, while a loan of 191,849 Nepali Rupees was supposedly invested in the name of Ramesh Adhikari, it was noted that this individual was fictitious according to the monitoring committee.

Similarly, the financial statements for fiscal year 2022-2023 claimed cash reserves of 4,168,377 Nepali Rupees, but it was indicated that this amount was mismanaged by the chairperson.

The audit report for fiscal year 2020-2021 indicated that the cooperative had invested more money than reported. In fiscal year 2021-2022, a loan of 500,000 Nepali Rupees was supposedly allocated in the name of Unnati Savings and Credit, but it was revealed that Suman Khanal managed this fund personally.

The monitoring committee noted that the person supposedly linked to the loan in fiscal year 2021-2022 was also fictitious.

The committee report indicated that since the establishment of the cooperative, the chairperson has mismanaged cash funds for personal use, and because of this, the cooperative has not received any interest. Therefore, it is claimed that Khanal owes the cooperative 4,434,167 Nepali Rupees in interest up to fiscal year 2021-2022 and an additional 1,631,387 Nepali Rupees in fiscal year 2022-2023, totaling 6,066,196 Nepali Rupees in interest mismanagement.

Chairperson Khanal reportedly holds shares worth 110,000 Nepali Rupees and has 2,322,599 Nepali Rupees in his savings account, amounting to 2,425,599 Nepali Rupees in total. After accounting for these amounts, the report concluded that he still owes the cooperative 13,836,770 Nepali Rupees.

Incorporating these findings, the report indicated that by the end of fiscal year 2021-2022, the cooperative should be owed 14,480,394 Nepali Rupees, and by the end of fiscal year 2022-2023, it should be owed 16,262,369 Nepali Rupees.

The report confirmed that Chairperson Khanal holds 110,000 Nepali Rupees in shares and 2,322,599 Nepali Rupees in his savings account, totaling 2,425,599 Nepali Rupees, leaving him with a liability of 13,836,770 Nepali Rupees to the cooperative.