Financial Crime World

Financial Crimes Soar in Nepal: Kathmandu Valley Top Hotspot for Banking Offenses

Kathmandu, Jan. 20: Over the past few years, financial crimes in Nepal have seen a dramatic increase. According to the latest police statistics, in just the first five months of the current fiscal year (2022/23), over 3,850 cases of banking offenses have been reported nationwide. This number is alarmingly close to the total tally of 5,383 cases recorded in the last fiscal year (2021/22) (Nepal Police Department, 2023).

Majority of Financial Crimes Involve Banking and Commercial Establishments

The Nepal Police Department revealed that the majority of these financial crimes involve banking and commercial establishments. In Kathmandu alone, 2,702 cases have been filed in the five months under review, making it the epicenter of financial crimes in the country (Nepal Police Department, 2023).

“The graph clearly shows that financial crimes have increased, and this is a challenge for us,” remarked DIG Tek Prasad Rai, addressing the growing concern (Poudel, 2023).

Most Common Type of Financial Crime: Cheque Bounce

One of the most common types of financial crimes is cheque bounce. An average of 10-12 cases are registered daily at the District Police Office in Kathmandu (Nepal Police Department, 2023). However, the legal classification of cheque dishonor has added complexity to the issue.

A Supreme Court ruling from four years ago stated that cheque dishonor should not be considered a banking offense But in April 2022, the bench of Justices Ananda Mohan Bhattarai, Anil Kumar Sinha, and Sushmalata Mathema reinstated cheque dishonor as a banking offense Leading to an increase in reported cases

A Steady Rise in Financial Crimes in Nepal

Historically, financial crimes in Nepal have witnessed a steady rise. In the fiscal year 2016/17, only 93 cases of banking offense were recorded. However, in the fiscal year 2020/21, the number surged by 25 times to 2,373 (Nepal Police Department, 2023). Kathmandu Valley has been particularly affected, with a significant concentration of economic activities, making it a breeding ground for financial crimes.

“The largest financial crimes are committed within Kathmandu Valley, ranging from basic theft and fraud to large-scale operations masterminded by organized criminals with global connections,” explained former Deputy Inspector General Hemanta Malla Thakuri (Poudel, 2023).

Involvement of Foreigners

The involvement of foreigners is also a growing concern, as the police stated that 49 of the 1,295 people prosecuted for banking crime offenses in the last three financial years and five months of the current financial year were foreign nationals (Nepal Police Department, 2023).

Police Committed to Combating Financial Crimes

Despite the challenges, the police remain committed to combating financial crimes and bringing perpetrators to justice. “We will continue our efforts to address financial crimes and ensure a safer business environment for all citizens,” said DIG Rai (Nepal Police Department, 2023).

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