Nepal: 3 Tax Officials Face Embezzlement Charges and $97.3 Million Fine Each

Published: 17 July 2017

Supreme court nepalSupreme Court of Nepal, Kathmandu (Photo: Juansang, CC BY-SA 3.0)

By Kyle Mackie

Three members of Nepal’s Tax Settlement Commission were charged with embezzlement Sunday in the largest corruption case filed to date by the country’s anti-graft agency.

The Commission for Investigation of Abuse of Authority (CIAA) requested a fine of Rs 10.02 billion (US$ 97.3 million) for each of the three officials, The Kathmandu Post reported.

The proposed fines are double the amount of the embezzled funds, according to a CIAA spokesperson, which is the standard set for government officials by the Corruption Prevention Act of 2002.

The CIAA seeks to recover a total of Rs 30.06 billion (US$ 291.8 million) from the tax commission’s Chairperson Lumba Dhowj Mahat, the suspended Director General of the Inland Revenue Department Chudamani Sharma, and commission member Umesh Prasad Dhakal.

Sharma was arrested on June 2, but the other two men remain at large after failing to appear before CIAA as requested on June 22, according to The Himalayan Times.

The officials allegedly misappropriated billions of Nepali rupees by exempting taxes for large businesses to their mutual benefit, Xinhua News reported.

The suspect tax settlements they facilitated were uncovered in an April 2017 report published by Nepal’s Office of the Auditor General, and only 45 of the 1,069 related files have been investigated by the CIAA so far.

"We will file separate or supplementary cases if additional embezzlement is established," said Special Court spokesperson Jagannath Poudel, according to The Kathmandu Post.

The accused officials have argued that they did nothing wrong in settling the tax cases, the Nepali outlet Republica reported.

The CIAA is seeking eight to 10-year jail terms for the officials, if convicted, in addition to payment of the punishing fines.