Cooperative in Risk

 A high-level probe commission formed to investigate troubled cooperatives on Monday confirmed individual depositors’ money worth Rs 9.63 billion put in 130 troubled cooperatives is at risk. The amount includes Rs 7.25 billion is individual deposits, while the rest is interest.

Oriental Cooperative has the largest liabilities — worth more than Rs 6 billion. Its Kathmandu office alone has to pay back Rs 3.43 billion to the depositors, while the Bhaktapur branch has to pay Rs 740.29 billion. Besides Kathmandu and Bhaktapur, Oriental has offices in Lalitpur, Pokhara, Syangja, Biratnagar and Parsa.

Of the total 12,461complaints registered against troubled cooperatives, 11,286 complaints are against Oriental. Oriental’s biggest individual depositor is Tara Devi Dhakal of Damak, Jhapa, who has Rs 190 million deposited in the cooperative.

Oriental Chairman Sudhiar Basnet not only has to pay back to the depositors, but also to those who have made up-front payment for his housing projects, many of which are incomplete. He also has liabilities to banks.
Against the banking norms, Basnet poured Oriental’s deposits into his housing projects, which could not complete due to a recession in the real estate sector for the last four years. The commission’s chairman Gauri Bahadur Karki said Basnet has been working to complete his housing projects in Imadol, Sanepa and Naxal.

Shuva Shree Cooperative has the third largest liability of Rs 623.08 million to depositors. Its promoters had taken loans for themselves, their family members and relatives. Instead of repaying the loans, they ran away by closing down its office in Putalisadak, Kathmandu.

The commission has also formed a sub-committee including depositors, those booking housing and apartments, chairmen of cooperatives and banks for the recovery of deposits.

Another cooperative to have big liabilities is Guna, which has to pay Rs 283 million to its depositors, according to the commission. Karki said Guna has already settled its liabilities worth Rs 130 million. “The cooperative has assured that it will be pay back Rs 90 million in the near future,” he said.

The commission has been interrogating operators of 35 cooperatives. It said it has asked the police to detain those promoters who have ignored its summons.