Bhutan: Former Board Director and CEO Sentenced to Prison for Insider Trading Case

A major blow to corruption in Bhutan, the Thimphu District Court has sentenced former Board Director of National Cottage and Small Industries Development Bank Limited (NCSIDBL) Tshewang Tashi and Chief Executive Officer of Sai Trading Partner Samten to three years and six months each in prison. The duo was found guilty of insider trading and bribery worth Nu 1 million.

The Investigation

According to the Anti-Corruption Commission’s investigation, Samten had paid a bribe to Tshewang when he was the Senior Livestock Production officer of the Ministry of Agriculture and Forests (MoAF) to get privileged information and fix an upcoming modern hatchery project tender in Samrang under Samdrupjongkhar. The bribery was done to ensure that Samten’s company got the contract for the project.

• Tshewang ensured that the tender document matched the technical specifications acquired by Samten from a company abroad.
• The commission found chat history and messages between the two over a period of one year, which revealed their illegal activities.

The Verdict

Tshewang had claimed in court that the money was part of a Nu 2.5 million loan he took from Samten, but the commission and the court rejected his claim. Both Tshewang and Samten have appealed against the verdict and are currently trying to get bail.

Previous Controversy

This is not the first time Tshewang has been involved in controversy. He is already under investigation by the Anti-Corruption Commission for another case related to his board position at NCSIDBL. It is alleged that he took part in giving a Nu 5 million loan to his own son for a meat processing unit, and Nu 3.9 million of the loan had already been disbursed.

Raising Questions

Tshewang was appointed as the board director by the Cabinet in 2020 despite the bribery case. The incident has raised questions about the appointment process and the lack of transparency in government institutions.

By convicting Tshewang and Samten, the court has sent a strong message against corruption in Bhutan’s public and private sectors. However, it remains to be seen whether this verdict will bring about meaningful reforms in the country’s governance and institution-building.