The Office of the Attorney General (OAG) is reviewing an investigation report on embezzlement and suspected fraud amounting to Nu 576.469 million (M) at the Bhutan Development Bank Limited (BDBL) in Thimphu.
The Anti-Corruption Commission (ACC) forwarded the report on unauthorised enhancement of overdraft (OD) and term loan fraudulently between 2013 and 2016 by the project officer of BDBL, to the OAG on June 22. ACC has recommended the OAG to prosecute nine accused involved in the fraud.
After reviewing facts and evidences transpired during the course of investigations, the commission reportedly established that Pema Nidup as a project officer allegedly enhanced loan of 55 clients amounting to Nu 576.469M. The project officer was alleged to have fiddled with the system to enhance the loan and collateral mortgage without the knowledge of credit and legal divisions.
Pema Nidup is accused of forging signatures of two legal assistants in the disbursement memo while enhancing term loans. The report stated that various office orders from the BDBL management let such illegal practices to occur.
The commission also found that a similar case involving another project officer in 2013. The court judgment had directed to review and improve the system to prevent such setbacks from employees in future. “However the BDBL management failed to correct the system and continued functioning as was the process,” the report stated.
The ACC categorised 55 clients into three kinds – those involved in fraud, those not involved (perceived innocent) and those who could not be contacted for verification.
In one of the fraud cases, Penden Dorji of Druk Lhayul Construction Private Limited based in Paro, has an OD loan of Nu 37.900M sanctioned legally and Nu 96.100M enhanced eight times allegedly by Pema Nidup without approval from the Credit Committee Meeting (CCM).
The commission found that Pema Nidup had withdrawn number of transactions from Penden Dorji and his wife’s OD accounts to favour enhancing Penden’s OD of Nu 96.100M. He allegedly forged the signature of Penden Dorji’s wife and withdrew a total amount of Nu 1.321M from two cheques on August 2, 2015 and Nu 1.341M from Penden’s OD account by forging his signature on September 16.
ACC’s report stated that Penden Dorji even after knowing the withdrawals did not make any issue as he was allegedly benefitting by enhancing his OD whenever he was in need of money. Pema Nidup is also alleged to have lent Nu 5.25M to Penden using Rinzin Dema’s OD account.