Cooperatives in Crisis: Depositors Urge Authority to Declare 1.5 Billion NPR Misappropriation as Problematic

The National Campaign for Cooperative Depositors’ Protection has submitted a petition to the National Cooperative Regulatory Authority (NCRA) requesting that 11 cooperative institutions be officially declared problematic in order to facilitate the return of depositors’ savings. Kushalb KC, president of the campaign, revealed that over NPR 148.22 crore has been misappropriated from these cooperatives and that their management is currently out of contact. Dr. Khagaraj Sharma, chairperson of the authority, clarified that the process of declaring cooperatives problematic would only proceed smoothly once the files are retrieved from the Registrar Office, emphasizing the need for coordination. (April 15, Kathmandu)

Victims of cooperative fraud are also demanding that an additional dozen cooperatives be declared problematic. Depositors, facing difficulties in reclaiming their savings, have petitioned the National Cooperative Regulatory Authority to declare these institutions as troubled. On Thursday, the atmosphere at the authority’s office was notably tense, with hundreds of depositors from 11 cooperatives present, accompanied by some police officers. Cancer patients, among others affected, gathered at the authority seeking resolution to the longstanding issue of unrecovered savings. This strong presence reflected their hope for an appropriate solution from the regulatory body.

The delegation of aggrieved depositors was led by Kushalb KC, president of the National Campaign for Cooperative Depositors’ Protection. They carried detailed documents evidencing the failure of these institutions to return depositors’ funds. The group formally requested the authority to initiate the process of declaring these cooperatives problematic and to transfer the files needed for action. Previously, the campaign had filed a similar petition urging the authority to declare 17 cooperatives as problematic.

Following the submission of the petition, the authority took necessary action and forwarded the case to the Ministry of Land Management, Cooperatives, and Poverty Alleviation. However, the ministry returned the files to the authority citing incomplete processes. Kushalb KC indicated that a lack of coordination among the ministry, department, authority, provincial, and local governments has hampered the declaration of troubled cooperatives. Moreover, he pointed out that the involvement of multiple regulatory bodies has further complicated the issue. “We have urged that institutions with no prospect be declared problematic so that the directors’ assets can be liquidated and depositors reimbursed. However, the related agencies tend to pass responsibility onto one another,” he explained.