Did the Court Order Not to Arrest Sherchan?

The High Court Patan had issued an order on November 23 directing authorities concerned not to arrest Ashok Sherchan, the chief executive officer of Prabhu Bank, in connection with a civil case. The Central Investigation Bureau of Nepal Police however arrested him on Sunday on criminal charges related to banking offense.

According to the November 23 order, the court barred Sherchan’s arrest only in civil matters.

CIB spokesperson Shiva Kumar Shrestha clarified that the police arrested Sherchan under a separate case after the same court issued an arrest warrant as the investigation involves a criminal offense under banking law. “The court on Monday granted a five-day remand for investigation,” he said.

Police arrested Sherchan, Deputy CEO Maniram Pokharel and Chief Risk Officer Rivas Shrestha while investigating the alleged embezzlement of funds related to Prabhu Money Transfer through Prabhu Management Company.

The CIB said it brought the bank’s top management under investigation after finding misuse of remittance funds. In order to cover up this financial irregularities, the bank officials also allegedly disbursed loans to “wrong individuals”.

In a press release, the bureau stated that Sherchan and others violated directives issued by the Nepal Rastra Bank and existing laws, causing financial losses to Prabhu Bank. The CIB also alleged that the accused attempted to conceal the offense by channeling loans worth millions of rupees through various companies and misusing those loans.