Unity bank accounts virtually empty , LinkToNepal

Unity bank accounts virtually empty

KATHMANDU, May 19: Initial investigations into Unity´s saga of fraud have revealed that Unity Life International (ULI) has virtually no money in the formal banking system, and this has raised fears that most of the funds it collected might have been siphoned out of the country.The company, which was engaged in illicit network marketing and raked in billions of rupees from 650,000 people to whom it sold dubious social security schemes, had savings accounts at numerous commercial banks. Butinvestigations showed that almost none of them had significant savings amounts.

“We are yet to dig out its accounts in cooperatives, but considering the massive withdrawals the company made in recent weeks, we fear the money might have been taken out of the country,” a highly-placed source told.

The investigations further showed that Unity had initially deposited Rs 800 million in Fina World Savings and Credit Cooperatives in fixed deposit. But interestingly, it had withdrawn the money, converting the account into current deposit. Currently, the cooperative has some Rs 75 million in Unity´s account, which the government has already frozen.

More surprise followed when investigators studied the company´s financial statement. “Contrary to the company´s statement that it has collected well over Rs 6 billion in cash from the local market, the total balance sheet of the company stood at a mere Rs 200 million,” said the source.

The statement neither cites the volume of assets nor liabilities. “It is very crude and does not comply with standard auditing norms,” said the source. Considering all this, the investigators have decided to drag in Unity´s auditor for further investigations.

Unity´s records that have been studied so far also showed that the company´s clients number 364,000. Company brass had been claiming that Unity has 400,000 Nepali clients and an additional 250,000 clients overseas.

“Surprisingly, the documents also showed that the company has not issued receipts to 250,000 out of the 364,000 clients it claims to have,” said the source.

Given this situation, officials concerned opined that the government can instantly charge the company with forgery and illegal mobilization of deposits.

However, because of the widespread nature of its businesses and unscrupulous operations, they have opined that the government should form a special investigation to dig out more facts for dealing with the Unity case.

Two Unity promoters remanded, others sought

Bhim Gurung and Netra Rajbanshi, the promoters of Unity Life International, were remanded by Lalitpur District Court on a fraud charge, Tuesday.

According to Superintendent of Police (SP) Bikram Thapa, chief of Metropolitan Police Range Lalitpur, the court granted an initial remand for four days following registration of a fraud case as per the ´Muluki Ain´. Gurung, the financial director, and Rajbanshi, travel director, were arrested in a raid at Unity´s head office at Jawalakhel, Lalitpur on Monday.

"This is part of the prosecution from our side and in course of investigations many other charges could be developed and lodged by other bodies of the state," said SP Thapa.

Meanwhile, police said it has geared up the hunt for other absconding promoters of thecompany. "We have kept their residences under surveillance and also raided four potential locations today alone," said SP Ramesh Kharel, chief of Metropolitan Police Range Kathmandu. "We believe they are still in the capital and could not have escaped."

Six absconding promoters were known to have left their homes after the governmentdecided to hold and interrogate them, police said. "We are focused on searching guest houses where our intelligence says they have been hiding," said a police officer involved in the investigations.