KATHMANDU, April 17: The Nepal Insurance Authority (NIA) has sought written clarifications from top executives of Himalayan Reinsurance Limited in connection with a scam involving the company's promoter, the embattled businessman Deepak Bhatta.
Acting under pressure from the Department of Money Laundering Investigation (DoMLI), the insurance sector regulator has demanded explanations from the reinsurer's Chief Executive Officer, four senior managers, and several board directors. In a letter sent Wednesday, the NIA asked these officials to provide proper justification as to why they should not be suspended.
According to the NIA, clarifications have been sought from CEO Upasana Poudel, Executive Directors Manish Kumar, Shishir Gair, and Santosh KC, among others.
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Bhatta, the company's promoter, is currently under investigation by the DoMLI. He stands accused of transferring Rs 2.73 billion from Himalayan Reinsurance to his personal account. Following the embezzlement allegation, the department launched a probe and has been pressuring the NIA to advance its own parallel scrutiny.
The DoMLI has also formally requested the NIA's assistance in the investigation. An NIA official said the authority would decide on further action, including potential suspensions, based on the clarifications submitted by the accused officials within one week.
Meanwhile, the DoMLI has already seized all necessary documents from the reinsurance company. A team from the Central Investigation Bureau (CIB) of Nepal Police arrested Bhatta on April 2.
The DoMLI has intensified its investigation into Bhatta and his business network over allegations of illicit wealth accumulation. Preliminary findings suggest his involvement in money laundering, banking and insurance-related offenses, revenue evasion, and misuse of public property. Shares of companies linked to Bhatta have been frozen by the CDS and Clearing Ltd, and Nepal Rastra Bank has placed Bhatta, his firm Infinity Holdings, and related individuals under financial surveillance.
Investigators have found that Bhatta misused funds from public limited companies to purchase shares of the same companies. He was also discovered to be trading his shares through Bhrikuti Stock Broking Company. Furthermore, Bhatta allegedly exerted influence over high-level officials at regulatory bodies, including the NIA, to advance his undue interests.
On Wednesday, the DoMLI raided the residences of Bhatta and Sulav Agrawal, as well as the office of Himalayan Reinsurance, as part of the money laundering probe. Agrawal is chairman of Jagdamba Holdings under the Shanker Group.
The DoMLI first initiated scrutiny into Bhatta in November 2022 following reports of suspicious financial transactions. That investigation, however, slowed under the previous administration before gaining renewed momentum following recent political shifts.
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