KATHMANDU, Oct 24: Police have widened their investigation into the alleged money laundering network of businessman Deepak Bhatta, arresting his brother Sushil Bhatta, a former chief executive officer of the Investment Board Nepal, and Inam Sapkota over their suspected financial and personal links.
The arrests followed information suggesting that Sapkota had been acting as an intermediary in efforts to influence the case against Deepak Bhatta, who is currently in custody in connection with a money laundering investigation. Investigators are also examining the alleged involvement of former Chief Justice Cholendra SJB Rana in efforts to settle the case.
According to sources close to the prime minister’s office, information retrieved from Rana’s mobile phone revealed his connection with Sapkota. Police suspect that Deepak Bhatta had been attempting to use Sapkota to reach Rana and influence the proceedings against him.
Police arrested Sapkota and began investigating his financial transactions and connections. He had previously been remanded in custody in a case under the Banking Offence and Punishment Act. Investigators later made an offence under the Nepal Rastra Bank Act the principal charge after finding his transactions suspicious. He is also being investigated for alleged money laundering.
Sushil Bhatta was subsequently arrested after investigators found suspicious financial dealings and communications involving him and Sapkota.
Kathmandu District Police Range arrested Sushil Bhatta on October 17, during the Dashain holiday. Senior Superintendent of Police Dilip Ghimire said police had acted after finding evidence of continued contact between the two men and suspicious communications.
Bhatta has been granted a seven-day remand for investigation into alleged money laundering.
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Police said the investigation was proceeding under money laundering charges against both Sapkota and Sushil Bhatta, while the offence under the Nepal Rastra Bank Act had been made the principal charge in Sapkota’s case.
Sources close to the prime minister’s office said investigators were examining whether Sushil Bhatta had used his connections to help his brother settle the case.
The two Bhatta brothers are suspected of having operated through a network of intermediaries. Investigators are seeking to establish the nature of their relationships and whether political connections were used to influence the case.
“After links with Sapkota appeared suspicious, Sushil Bhatta was also arrested, and the investigation is proceeding under money laundering charges. Police have treated the offence under the Nepal Rastra Bank Act as the main case,” a police source said.
Political connections under scrutiny
Sushil Bhatta was appointed chief executive officer of the Investment Board during the government led by KP Sharma Oli. His alleged links with Sapkota have prompted investigators to examine whether political connections were used in attempts to influence Deepak Bhatta’s case.
Allegations that Deepak Bhatta had sought to influence the judiciary and mobilised political connections to settle his case had already raised concerns within the government. His reported links with Oli and Nepali Congress leader Sher Bahadur Deuba have also drawn attention.
An official at the Department of Money Laundering Investigation said the probe was focused on Deepak Bhatta’s financial and political network.
Sources close to the prime minister’s office said Prime Minister Balendra Shah had ordered Deepak Bhatta’s arrest on April 2 without informing Home Minister Sudan Gurung.
Bhatt was arrested over allegations of misappropriating funds linked to Himalayan Reinsurance. He is facing a money laundering case involving Rs 26 billion, while cases have also been filed against him under the Securities Act and banking offence laws.
Sources said the government was seeking to dismantle the entire network associated with Bhatta and bring all those allegedly involved within the scope of the investigation, including the former chief justice.
Bhatta has since been transferred to Sindhuli.
Basnet released on bail
In a separate development, Nabin Raj Basnet, who was arrested after 13 years in a forest-related case, has been released on bail.
Basnet had been charged in Kathmandu in 2069 BS in a case involving alleged forest offences but had remained at large. He was arrested on October 9 following a request from the Department of Money Laundering Investigation.
According to police, the Kathmandu Division Forest Office arrested him through the Central Investigation Bureau after receiving a letter from the department seeking action in connection with the old case.
Basnet was released on bail before the money laundering investigation against him had begun. Police said he had been directed to appear before the court after the Dashain holiday in connection with the earlier case.
However, sources claimed that an order from the prime minister’s secretariat had led to his release during the holiday, despite his arrest after years of evading authorities. The circumstances surrounding his release have not been officially clarified.
Sources also alleged that Basnet had connections with people close to Prime Minister Shah.
The Department of Money Laundering Investigation is expected to determine whether to proceed with the case after the Dashain holiday. Its decision could help clarify why Basnet was arrested at the department’s request but released on bail before the money laundering probe began.