CIAA Raids Nepal SEBON: IPO Approval Commission, Bribery Investigation
8th May 2025, Kathmandu
The Commission for the Investigation of Abuse of Authority (CIAA) has raided the office of the Nepal Securities Board (SEBON). The raid took place on Wednesday afternoon at SEBON’s Khumaltar-based office in Lalitpur. The CIAA team arrived around 12 PM.
CIAA Raids Nepal SEBON
Sources said the team seized files related to IPO approvals. The files included documents from companies that had applied for IPO issuance. Some companies were still under review. Others had recently received approval.
Allegations of Commission Demands
This raid followed serious accusations against SEBON. Hydropower companies alleged that SEBON demanded commissions to approve IPOs. The claims were made public by IPPAN, the Independent Power Producers’ Association of Nepal.
IPPAN stated that SEBON asked for a 7% commission from companies with paid-up capital below Rs. 500 million. For companies with more capital, the alleged commission was even higher.
The matter quickly gained political attention. During Wednesday’s House of Representatives session, the CPN (Maoist Centre) demanded an investigation. The CIAA responded by launching a probe.
Documents Taken for Investigation
According to SEBON staff, a three-member team from CIAA stayed at the office from 11:30 AM to 4 PM. During this time, the team reviewed documents and collected some files. The files focused on companies involved in IPO issuance over the last five months.
One SEBON employee confirmed the details. “The team checked records of companies that recently got approval and those still waiting,” the employee said.
Long List of Pending IPOs
At present, 89 companies have applied for IPO approval at SEBON. They have proposed to issue about 404.7 million shares, worth around Rs. 56.07 billion.
Out of these, 43 companies belong to the hydropower sector. These firms are seeking to issue over 190.3 million shares, valued at Rs. 19.44 billion.
Hydropower promoters have raised concerns over delays in the approval process. They believe SEBON has deliberately slowed the process for nearly 22 months.
Use of Intermediaries Alleged
IPPAN has accused SEBON of involving intermediaries. These agents reportedly acted on behalf of SEBON officials to collect commissions. Promoters claim approvals were held back unless companies agreed to pay.
On Tuesday, IPPAN held a formal event to publicize these allegations. They also demanded a fair investigation into SEBON’s actions. The next day, the CIAA raided SEBON’s office.
Past Complaints Also Cited
This isn’t the first time SEBON has faced criticism. CIAA sources said complaints were filed earlier as well. These included charges of misusing power, delaying approvals, and favoring certain companies.
There were also reports of SEBON granting IPO permissions to firms that didn’t meet the required standards. Critics claim such decisions were influenced by personal or political connections.
A CIAA official said, “We’ve had several written and verbal complaints about SEBON in the past. This time, new evidence and pressure from stakeholders pushed us to act.”
Market Confidence at Risk
The latest controversy has created tension in Nepal’s capital market. SEBON plays a crucial role in approving public offerings and regulating market practices. Allegations of corruption threaten investor trust.
Analysts say delays and irregularities in IPO approvals hurt small investors the most. Many rely on IPOs for returns, especially in the hydropower sector. The recent complaints have raised fears of insider dealing and unfair treatment.
What Happens Next?
The CIAA has not released an official statement yet. However, sources said the commission will continue its investigation. They may soon question SEBON officials and examine communications between SEBON and companies.
At the same time, public pressure is rising. Lawmakers and industry leaders are calling for accountability. Many believe this is a chance to reform how IPOs are approved in Nepal.
Until now, SEBON has stayed silent. But with growing scrutiny, the board is likely to face tough questions. The outcome of this case could reshape capital market regulation in the country.
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