Serious Insider Trading Allegations Emerge Against Nerude Mirmire Laghubitta

15th May 2026, Kathmandu

The financial sector in Nepal is facing another wave of scrutiny as serious allegations of insider trading and financial manipulation have surfaced against Nerude Mirmire Laghubitta Bittiya Sanstha.

Nerude Mirmire Insider Trading

Disgruntled shareholders are claiming that the microfinance institution published misleading financial disclosures, which artificially impacted the capital market and caused unsuspecting investors to suffer losses worth millions of rupees. The controversy primarily centers around the company financial report for the fiscal year 2080/81, which critics argue contained highly inflated profitability metrics designed to influence market sentiment ahead of strategic stock sales.

Unprecedented Surge In Share Trading Volume

Prior to the controversial announcement, the microfinance institution maintained a relatively stable presence on the secondary market. Reports indicate that the company typically traded between 3,000 and 7,000 shares daily, with prices fluctuating within a modest range of NPR 600 to NPR 700 per share. This pattern changed dramatically on Shrawan 26, 2081, when the institution published its fourth quarter financial statement in a national daily newspaper. The publication declared a net profit of NPR 44.70 crore alongside an impressive earnings per share of NPR 62.48, triggering an immediate reaction on the Nepal Stock Exchange trading floor.

Massive Market Transactions and Price Manipulation

Following the publication of these stellar numbers, investor demand surged instantly, causing the share price to spike into a range between NPR 960 and NPR 1,000 per share. Over the course of just three trading days, the market witnessed an unprecedented volume of transactions. Records show that 230,828 shares were traded on Shrawan 27, followed by 157,868 shares on Shrawan 28, and another 94,514 shares on Shrawan 29. In total, more than 483,210 shares changed hands during this brief window, generating transactions worth more than NPR 47 crore as buyers rushed to acquire the seemingly high performing stock.

Sudden Revisions Raise Regulatory Red Flags

The market enthusiasm evaporated shortly afterward when Nerude Mirmire Laghubitta issued a corrective notice. The company stated that the previously announced earnings per share figure was incorrect due to a reporting error and should have been listed as NPR 46.86 instead of the inflated NPR 62.48. This massive reduction immediately drew criticism from market experts. Sanjay Shrestha, a former director of the previous Mirmire Laghubitta, openly alleged that the incorrect details were intentionally published to artificially pump the share prices and create an ideal environment for coordinated insider trading.

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Accusations Point To Board Members and Broker Firms

Affected shareholders have escalated the matter by filing formal complaints naming specific individuals and institutions suspected of benefiting from the price movement. The complaint submitted to regulatory bodies alleges that several individuals sold off significant portions of their holdings under the names of close relatives during the peak trading days. The individuals named in the documents include Man Bahadur Rai, Raj Kumar Rai, Santosh Phuyal, Sanju Ghimire, and Rajkumar Timilsina. Additionally, the complaints point to specific brokerage houses, namely Akashbhairav Securities and Vision Securities, for facilitating these high volume transactions.

Claims of Severe Financial Misrepresentation

Beyond the incorrect metrics, deeper structural irregularities have been alleged regarding the internal governance of the microfinance company. Sanjay Shrestha claimed that bad loans were systematically renewed against the explicit regulatory directives of the central bank to present the institution as highly profitable. He further asserted that these artificial numbers led to genuine financial harm to the institution, including an unnecessary cash outflow of NPR 14.99 crore paid in taxes based on fictional profits, and an additional NPR 4.40 crore distributed as employee bonuses, resulting in cumulative losses exceeding NPR 19.39 crore.

Multi Agency Investigations Demanded By Investors

Seeking justice and financial accountability, the affected investor group has formally moved forward by lodging complaints with multiple state authorities. Petitions have been filed simultaneously with Nepal Rastra Bank, the Securities Board of Nepal, the Department of Money Laundering Investigation, and the Commission for the Investigation of Abuse of Authority. The legal filings state that the actions committed by the management and its promoters constitute a direct violation of the Securities Act 2063, which strictly prohibits market manipulation, misleading the investing public, and manufacturing artificial price movements.

Defenses and Institutional Responses

In response to the growing public outcry, the accused individuals have firmly denied any wrongdoing or active involvement in market manipulation. Rajkumar Timilsina clarified that he functions purely as a promoter shareholder and holds no executive power or decision making role within the daily management of the firm. Similarly, Man Bahadur Rai stated that he has never served on the official board or management team, claiming his personal share transactions were fully compliant with existing market regulations. Both figures expressed their total willingness to cooperate with any official investigations launched by the state.

Regulators Treat Case As Major Governance Failure

From an administrative perspective, Chief Executive Officer Keshav Kumar Poudel stated that he has no information regarding the insider trading allegations and confirmed that the institution has not yet received any formal communication from regulatory offices. Meanwhile, Guru Prasad Poudel, the spokesperson and executive director of Nepal Rastra Bank, remarked that insider trading is fundamentally linked to a breakdown in institutional governance. While noting that the matter falls primarily under the jurisdiction of the Securities Board of Nepal, he made it clear that the central bank stands ready to take strict regulatory action if governance violations are proven.

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