KATHMANDU, Sept 29: When the Balendra Shah government took office, it promised to help victims of troubled cooperatives recover their savings, including by seizing and auctioning assets belonging to operators and borrowers accused of embezzlement.
But depositors are still waiting for their money, while several major suspects accused of misappropriating billions of rupees remain abroad despite Interpol Red Notices.
Among the most prominent is Gitendra Babu, or GB Rai, accused of diverting cooperative funds into more than a dozen private businesses. He faces charges involving six cooperatives in Kaski, Rupandehi, Chitwan, Parsa and Kathmandu, along with organised crime and money laundering cases.
Interpol issued a Red Notice against Rai on January 25, 2024 (Magh 25, 2080). Records showed him receiving a message in Malaysia on March 19, 2024 (Chaitra 6, 2080), but Nepal has since failed to secure his arrest. A Nepal Police team that travelled to Malaysia reportedly received little cooperation.
Cases against Rai include claims of Rs 1.86 billion involving Suryadarshan Cooperative in Kaski, Rs 555.2 million involving Supreme Cooperative in Rupandehi and Rs 370 million involving Sahara Multipurpose Cooperative in Chitwan. His assets and businesses in Nepal have been frozen, but authorities have yet to begin selling businesses allegedly established with cooperative money to repay depositors.
Another major fugitive is Bharat Maharjan, accused of misusing more than Rs 7 billion from Sumeru Cooperative. Interpol issued a Red Notice against him on January 2, 2024 (Poush 17, 2080). Records placed him in the United Kingdom on February 2, 2024 (Magh 19, 2080), but he has not been brought back.
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An investigating officer said businesses allegedly financed with Sumeru funds continue operating and earning income. Although the assets have been frozen from sale while court proceedings continue, the government has not taken control of the income to compensate depositors.
“The businesses are operating under company law and may have other partners. They could even be sending their earnings to Maharjan, but who will return the depositors’ money?” the officer said.
Bhupendra Rai, accused of misappropriating Rs 807.2 million from Suryadarshan Cooperative, is also on Interpol’s wanted list. Records show he left Nepal for Britain on June 9, 2023 (Jestha 26, 2080). Another Suryadarshan suspect, Than Bahadur Budha, faces a claim of Rs 270 million and remains untraced despite a Red Notice.
Chhela Nepali, accused of misappropriating Rs 1.38 billion from Image Cooperative in Baglung, is also wanted through Interpol. Police received information that she travelled from India to Britain on July 17, 2023 (Shrawan 1, 2080), but attempts to arrest her have failed. Her husband, Dev Kumar Nepali, was, however, arrested in India and returned to Nepal.
Authorities also do not know the whereabouts of Bal Gopal Shrestha, wanted over an alleged Rs 299.8 million fraud involving Tapain Hamro Cooperative in Parbat.
Sagar KC, charged in connection with an alleged Rs 1.02 billion fraud at Supreme Cooperative in Rupandehi, remains on Interpol’s wanted list. Jyoti Gurung, accused of misappropriating Rs 140 million from Miteri Cooperative in Lalitpur, also remains at large despite a Red Notice. Another Miteri suspect, Jyoti Bahadur Bhandari, was returned from Cambodia with Interpol assistance in June 2025.
Devendra Babu Rai is also wanted internationally over an alleged Rs 1.02 billion cooperative fraud.
Altogether, Red Notices remain active against nine suspects accused of large-scale cooperative fraud, but Nepal Police has struggled to bring them home.
Police spokesperson Abinarayan Kafle said those on the Red Notice list would eventually face legal action, expressing confidence that countries where they are staying would locate and return them.
Police officials, however, acknowledge complications. Some suspects may have obtained foreign citizenship, and countries are not necessarily obliged to extradite their own citizens.
One officer involved in investigations said Interpol mechanisms alone were insufficient.
“Interpol is a technical mechanism. If GB Rai is doing business abroad with hundreds of millions of rupees, bringing him back requires diplomatic pressure,” the officer said. “If we cannot bring back those who took cooperative money abroad and invested it in businesses, how can depositors recover their savings? The government needs stronger diplomatic initiatives.”
Recovering money through assets at home has proved equally difficult.
Rabin Dhakal, member secretary of the Problematic Cooperative Management Committee, said authorities have been unable to auction the assets of absconding suspects and return the proceeds to victims. Some businesses established with cooperative funds have other partners, creating legal barriers to their sale.
Although authorities can freeze assets belonging to people accused of fraud, Dhakal said turning those assets into cash through auction remains legally and practically difficult.
