Kathmandu. The Financial Action Task Force (FATF) has placed Nepal in the ‘Grey List’ in terms of money laundering.
The FATF has pledged policy and practice reforms to reduce currency cleansing from the financial sector after being placed on the grey list. The government has also submitted an action plan. Finance Minister Bishnu Poudel has pledged to remove Nepal from the grey list by fully implementing the action plan.
The government’s words and actions have not been matched. The regulatory body of the financial sector has the primary responsibility to control the money laundering through the financial sector. In such a sensitive situation, the issue of selecting the leadership of important regulators of the financial sector – Nepal Rastra Bank, Securities Board of Nepal, Nepal Insurance Authority and Cooperative Regulatory Authority – has long been controversial.
These appointments have become controversial because the ruling parties did not have the qualifications prescribed by the law in the race for division and appointed a person known as an active worker of the political party to the leadership level of the regulator. From criticism on social media to filing a writ petition in the Supreme Court, there has been a demand to cancel the government appointment.
Nepal Rastra Bank (NRB) Governor Dr Bishwanath Poudel is an active cadre of the Nepali Congress( NC). He was also a member of the Board of Directors of Ulens, an educational institution promoted by Minister for Foreign Affairs Arju Deuba. A complaint has also been filed with the Commission for the Investigation of Abuse of Authority (CIAA) to investigate poudel’s appointment as governor.
Co-operative Regulatory Authority Chairman Dr Khagaraj Sharma was an active member of the CPN-UML until his appointment. Santosh Narayan Shrestha, who has been appointed chairman of the Securities Board, has been criticized for promoting the business group trying to capture the financial sector.
The government has suspended Sharad Ojha, who was appointed as the chairman of Nepal Insurance Authority (NEA) from the quota of ruling partner Nepali Congress, after facing criticism from all quarters for being ineligible. Radha Kumari Pokharel, a member of nea’s board of directors, was forced to resign from the post due to disqualification less than four months ago.
The regulatory body has not been able to carry out policy reforms to prevent money laundering as the tenure of the person appointed at the leadership level has not been finalized. The employees entrusted with the responsibility of implementing the policy have become prisoners of confusion.
