A high-level probe commission – formed to investigate troubled cooperatives today – raided the Maitidevi-based central office of Oriental Saving and Credit Cooperative and seized ledgers and computer.
“We raided the troubled cooperative as its chairman denied to submit financial details and stopped cooperating with the commission in conducting Oriental’s Due Diligence Audit (DDA),” chairman of the commission Gauri Bahadur Karki said.
Kathmandu Division Cooperative chief Balaram Niraula, auditor Sagar Sigdel, advocate Keshab Gautam and a group of depositors seized two CPUs and some documents from the office, according to the commission.
This is the first time the commission has raided a troubled cooperative.
The commission raided the Oriental as its chairman Sudhir Basnet did not submit the papers despite repeated requests, informed the commission.
The commission had received 11,286 complaints worth more than Rs 6 billion against Oriental.
It has received a total of 12,778 complaints worth Rs 9.63 billion against 130 cooperatives.
Despite his repeated promise, Basnet didnot submit the financial documents to the commission.
On March 12, the commission had even sent a team to the head office of the cooperative to start auditing work, but Basnet kept avoiding the urgency call.
According to a member of the commission Sushil Ram Mathema, they seized the documents to study its financial status and transactions. “We will investigate the assets and liabilities situation, credit, balance sheet and memorandums of understanding Basnet signed with buyers of his housing projects,” he said. “Basnet, though has been expressing commitment to complete his housing projects and use the revenue to pay his liabilities, was not serious in submitting the documents asked by the commission.”
His three projects – Imadol-based Vegas City, Sanepa-based Sanepa Housing, and Naxal-based Imperial Housing – could not be completed due to financial crisis. But he had put the project as collateral at various banks and also collected installment from the buyers.
The Oriental Cooperative have also invested in Oriental Builders and Developers, Oriental Colony, Kaushaltar Homes, Chakrapath Heights and Dhumbarahi Apartment Phase 2. The total claims of the victims of these housing projects stand at Rs 1.28 billion.
Basnet has assured that he would pay Rs 1.50 billion after selling his housing projects through a bank account maintained by the commission, apart from
committing to carry out Due Diligence Audit of all his transactions, but left thousands of Oriental depositors without paying back their deposits in Oriental cooperatives.
Oriental Cooperative needs to return at least Rs 5.17 billion, including Rs 3.89 billion in principal amount, to its depositors. It had collected the deposits through its nine branches in three districts of Kathmandu Valley, Pokhara, Biratnagar, Itahari, Syangja and Parsa.
Basnet was also arrested by police in January last year on fraud charges.
Meanwhile, the victims of the Oriental Cooperatives have been protesting before the Department of Cooperatives in New Baneshwar for the past five months, demanding that their deposits be refunded at the earliest.
But the government, the commission, and Cooperatives Department are also not giving an ear also due to back up from political party. Some of the political parties still believe that the cooperatives is the third pillar, despite common people – for whom they claim to have done politics – have been victimised by the cooperatives by cheating and fraud like Oriental and Basnet.