wikileaks ico  Home papers ico  Cables mirror and Afghan War Diary privacy policy Privacy
Identifier
Created
Classification
Origin
02KATHMANDU2060
2002-10-30 08:42:00
UNCLASSIFIED//FOR OFFICIAL USE ONLY
Embassy Kathmandu
Cable title:  

NEPAL CORRUPTION AUTHORITY TAKES ON EX-MINISTERS

Tags:   PGOV  KCRM  SNAR  NP 
pdf how-to read a cable
This record is a partial extract of the original cable. The full text of the original cable is not available.
						UNCLAS SECTION 01 OF 03 KATHMANDU 002060 

SIPDIS

SENSITIVE

STATE FOR SA/INS AND INL
LONDON FOR POL - RIEDEL
JUSTICE FOR OPDAT - CRAWFORD

E.O. 12958: N/A
TAGS: PGOV KCRM SNAR NP
SUBJECT: NEPAL CORRUPTION AUTHORITY TAKES ON EX-MINISTERS

REF: A. (A) KATHMANDU 1618

B. (B) KATHMANDU 0800

C. (C) KATHMANDU 0418

D. (D) KATHMANDU 1964

--------
SUMMARY
---------

UNCLAS SECTION 01 OF 03 KATHMANDU 002060

SIPDIS

SENSITIVE

STATE FOR SA/INS AND INL
LONDON FOR POL - RIEDEL
JUSTICE FOR OPDAT - CRAWFORD

E.O. 12958: N/A
TAGS: PGOV KCRM SNAR NP
SUBJECT: NEPAL CORRUPTION AUTHORITY TAKES ON EX-MINISTERS

REF: A. (A) KATHMANDU 1618

B. (B) KATHMANDU 0800

C. (C) KATHMANDU 0418

D. (D) KATHMANDU 1964

--------------
SUMMARY
--------------


1. (SBU) Despite the recent change in government, the
Commission for Investigation into the Abuse of Authority
(CIAA), the autonomous constitutional body charged with
prosecuting corruption, is continuing to pursue a number of
high-profile cases against several former ministers and
prominent civil servants. The CIAA can employ sweeping
powers of investigation and prosecution unparalleled by other
government agencies, and its zeal dovetails with the interim
government's emphasis on good governance. A public long
disenchanted by flagrant and widespsread corruption at the
highest levels of government has so far overwhelmingly
welcomed the probes. A Department of Justice program to
train prosecutors for corruption cases, scheduled to take
place in Kathmandu from November 18-22, is particularly well
timed. To maintain the credibility and reputation for
independence it now enjoys, the CIAA must remain careful to
keep its investigations non-partisan and balanced. End
summary.

--------------
CORRUPTION QUERIES CONTINUE
--------------


2. (U) When the Commission for the Investigation into the
Abuse of Authority (CIAA), the autonomous constitutional body
charged with prosecuting official corruption, began
investigating corruption charges against 22 mid-level civil
servants--most from the Department of Customs and Ministry of
Finance--in August (Ref A), many observers hoped that
inquiries into the activities of even more prominent
personalities would follow. Since then the agency, armed
with the interim goverment's mandate to tackle corruption and
restore good governance, has followed up these initial probes
with a series of inquiries aimed at several high-ranking
officials in previous administrations, including at least
three ex-ministers in former Prime Minister Sher Bahadur
Deuba's Cabinet.


3. (U) The Commission is questioning former Minister for
Information and Communications Jaya Prakash Gupta; former

Minister for Home Affairs Khum Bahadur Khadka; and former
Minister for Physical Planning and Works Chiranjibi Wagle
(all from Deuba's Nepali Congress government). Also called
in for questioning has been Ram Krishna Mainali, a member of
the Communist Party of Nepal - United Marxist Leninist (UML),
who had been Minister of Communications in a 1998 coalition
government.


4. (U) So far the inquiries into these former members of
Deuba's Cabinet have focused on actions they took while
Ministers in previous Nepali Congress governments. Gupta is
under investigation for a mobile telephone deal he authorized
as Communications Minister in 1999 (Mainali is being
questioned for beginning the deal during his tenure as
Minister the year before); Khadka for having awarded several
unbid contracts for projects during his time as Water
Resources Minister from 1995-1997; and Wagle, along with his
unemployed son, for having amassed wealth not commensurate
with the level of his official remuneration. Also under
investigation is General Manager of the state-owned (and
largely bankrupt) Royal Nepal Air Corporation, Ramagya Prasad
Chaturbedi, for possible corrupt dealings during a previous
incarnation as General Manager of the state-owned National
Construction Company; and Ananda Khanal, a former Director
General for road construction in the Ministry of Physical
Works.


5. (U) Paralleling CIAA's investigations is the work being
done by yet another independent body, the Judicial
Investigation and Probe Commission on Property (JIPC),
appointed by former PM Deuba in March to assess the value of
personal assets acknowledged by more than 40,000 current and
former politicians, Members of Parliament, Ministers, and
civil servants who have held office since 1990 (Ref C).
Sources at the JIPC, which has no prosecutorial powers of its
own, have already indicated to the press that they plan to
question a multi-partisan group of former ministers, as well
as Sujata Koirala, the daughter of former Prime Minister G.P.
Koirala. If sufficient evidence against the subjects is
found, the cases will be referred to CIAA for prosecution.

6. (SBU) Former Prime Minister Deuba has told the
Ambassador that he welcomes CIAA's pro-active stance,
commenting that he "would be relieved" if any former members
of his Cabinet implicated in corrupt activities were to end
up being indicted (Ref D). He added that he considers
passage of tougher anti-corruption legislation during his
most recent administration one of his proudest achievements.

-------------- --------------
POLITICAL APPOINTEE HEADS OF STATE-OWNED ENTERPRISES AXED
-------------- --------------


7. (U) On October 28 the interim government fired all the
general managers of the 39 state-owned enterprises. So far,
no replacements have been named. GM positions at the head of
the state-owned enterprises, most of which are operating in
the red, have long been regarded as lucrative sinecures for
well-connected political allies of the party in power, who
have often treated those corporations as cash cows to fund
personal and partisan activities. Although a report by the
National Planning Commission in 2000 recommended that the SOE
directors be chosen on the basis of merit and competence,
rather than patronage and paybacks, no action was taken to
revamp management.

--------------
CIAA: BROAD POWERS, KEY MANDATE
--------------


8. (SBU) The CIAA adopted its more vigorous and visible
public stance after Parliament passed more stringent
anti-corruption legislation in April (Ref B), including an
act that established a Special Court to try corruption cases.
The new legislation gives the CIAA sweeping authority to
investigate; conduct searches; examine bank accounts; freeze
and/or impound assets; charge; and prosecute cases against
public officials. The Commission may decide to "pick up
cases from anywhere," according to Chief Commissioner Surya
Nath Upadhyay--even an anonymous e-mail, phone call, or
letter. At least two of the three Commissioners must decide
that there is sufficient initial evidence against a suspect
to begin an investigation. (Note: CIAA's authority does not
extend to members of the judiciary, the Royal Nepal Army,
and, of course, the Royal Family. End note.) Suspects in a
CIAA case may be detained for up to six months without
charge. The 18 suspects arrested in CIAA's initial sweep at
the Department of Customs and Ministry of Finance in August
(Ref A) have been held for more than two months.


9. (SBU) The probes seem to have gained in breadth--as well
as in the height of the positions targeted--since King
Gyanendra appointed the interim government under Prime
Minister Lokendra Bahadur Chand with a special mandate to
clean up corruption. Besides the former Ministers now under
investigation, the CIAA is contemplating bringing charges
against a host of other prominent figures from different
political parties, Upadhyay told the Ambassador in an October
22 meeting. For example, the CIAA is examining allegations
against a former Nepali Congress Home Minister, who
attributes his excessive wealth to money sent him by his son,
who now lives in the U.S. Since the son has apparently been
out of school for only one year, however, Upadhayay says he
questions this story. He asked for U.S. Embassy assistance
in verifying the son's income in the U.S. (We understand the
British received a similar request regarding a former UML
Minister's son.) The Ambassador undertook to extend all
appropriate assistance.

--------------
DOJ WORKSHOP TIMELY
--------------


10. (U) The U.S. Department of Justice Office of Overseas
Prosecutorial Development, Assistance and Training (OPDAT)
will conduct a one-week workshop in Kathmandu November 18-22
aimed at training 35 prosecutors, judges, and policemen in
dealing with corruption cases. While this training was
planned well before these corruption cases hit the front
pages, the timing of the workshop--just as CIAA appears to be
gearing up to bring a number of cases before the Special
Court--is particularly fortuitous.

--------------
COMMENT
--------------


11. (SBU) Most Nepalis believe that corruption, while
discreetly present during the autocratic Panchayat regime,
has burgeoned into a free-wheeling growth industry in the 12
years since the restoration of democracy. Whether that
perception is correct or not, many disenchanted citizens
associate democracy with the democratiziation of
rapaciousness and venality. Demonstrating that a
constitutional government can stem this pervasive and
commonplace vice after more than a decade of neglect is a
near-gargantuan task. CIAA, at long last, appears to be
exercising powers broad enough--almost too broad--to meet the
challenge. So far, we see no evidence that CIAA intends to
abuse this power, and are encouraged that it is adopting a
multi-partisan approach--especially since there seems to be
ample evidence of guilt on both sides of the aisle.
Safeguarding this impartiality is obviously key to
maintaining CIAA's credibility, and thus to the success of
its goals. As outlined in our Mission Program Plan, the
Embassy wants to supplement long-delayed Government of Nepal
efforts to tackle corruption with programs similar to the
timely OPDAT prosecutoiral training course.
MALINOWSKI