CIAA arrests six including ex-chair of Yeti Development Bank on loan scam

ShareSansar, December 12:

The Commission for the Investigation of Abuse of Authority (CIAA) has the then Executive Chairperson of Yeti Development Bank Sita Ram Prasai and five others officials in connection with a banking fraud.

They have been charged with issuing a loan of Rs 70 lakh against a plot of land at Aurabani VDC of Sunsari district worth Rs 1.87 lakh on the basis of forged documents, including false land ownership certificate

This is the first time the CIAA has intervened and arrested the promoters of any bank run by the private sector.

It also comes at a time when the stakeholders are discussing whether the constitutional watchdog should be allowed to probe irregularities in the private sector, especially BFIs.

Besides Prasai, the then general manager of the development bank Bhagwat Shrestha, senior manager Sunil Gurung as well as proprietor of Khoshi Marketing Keshav Lal Khoshi Shrestha and his heir Sunil Pradhan and senior clerk at Sunsari Land Revenue Office Divya Raj Ghimire have been rounded up for interrogation.

Prasai and the company had issued the loan to Khoshi Marketing.

Initially this development bank was named Udyog Bikas Bank and then Gharelu Udyog Bikas Bank.

When Nepal Rastra Bank had declared Gharelu Bikas Bank was in crisis, was later renamed Manakamana Bikas Bank, after Prasai included new partners. This development bank then went on to merge with Valley and Yeti Finance Companies to become Yeti Development Bank.