KATHMANDU, August 24: Weak monitoring of cooperatives by the regulators concerned has put large amounts of money deposited by their members at risk.
The Office of the Attorney General (OAG) in its 58th annual report has pointed out that the officials of the Department of Cooperatives are reluctant to carry out effective monitoring of the primary cooperatives. “The officials are found not abiding by the Cooperatives Act 2017 to conduct the monitoring as prescribed by the law,” reads the report.
As a result, the cooperatives are found collecting hefty service charges from their members, misusing the funds and failing to hold annual general meetings on time. The cooperatives are also found not allocating sufficient money in risk funds, involving in unlawful transactions with similar other cooperatives and failing to abide by the anti-money laundering laws.
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As of now, the government has declared 11 cooperatives as ‘problematic,’ which are unable to pay back over Rs 1.96 billion of their depositors. These include Standard Savings and Credit Cooperative, Prabhu Savings and Credit Cooperative, Consumer Savings and Credit Cooperative, Kuber Savings and Credit Cooperative, Chartered Savings and Credit Cooperative, Vegas Savings and Credit Cooperative, Pacific Savings and Investment Cooperative, Kohinoor Hill Savings and Credit Cooperative, Standard Multipurpose Cooperative, Societal Savings and Credit Cooperative and Lunibha Multipurpose Cooperative.
Recently, Anandanagar Savings and Credit Cooperative, Goodwill Cooperative and Civil Savings and Credit Cooperative are also reeling through a serious financial crisis.
Earlier, the government regulator had put the Oriental Cooperative in the list. However, the Supreme Court’s verdict last year gave flexibility to the cooperative’s Chairman Sudhir Basnet to settle dues of its members by selling away property belonging to the Oriental Cooperatives.
