️ Legal & Banking: Prabhu Bank CEO and Top Executives in CIB Custody for 5-Day Investigation

Prabhu Bank CEO Investigation

2nd December 2025, Kathmandu

The Central Investigation Bureau (CIB) has secured a five-day custody extension from the Patan High Court to continue its investigation into top executives of Prabhu Bank.

Prabhu Bank CEO Investigation

This high-profile case centers around alleged misuse of funds and violation of banking regulations. The executives being investigated are Prabhu Bank CEO Investigation CIB focuses on, including Chief Executive Officer (CEO) Ashok Sherchan, Deputy CEO Maniram Pokharel, and Chief Credit Officer Riwash Shrestha.

This development underscores the strict regulatory environment financial institutions operate in and the increasing scrutiny by law enforcement agencies like the CIB.

The Basis of the CIB’s Action

CIB apprehended the three executives under the provisions of the Banking Offence and Punishment Act, 2064 (2007). The core allegation against CEO Sherchan is that he engaged in activities that led to financial losses for the bank. These actions allegedly contravened directives issued by the Nepal Rastra Bank (NRB) and existing laws.

Furthermore, CIB asserts that the CEO facilitated the diversion of millions of rupees. This was reportedly done by issuing loans to various companies, a tactic allegedly used to mask the initial misconduct and misuse the allocated credit facilities. These practices are now under intense forensic investigation.

Regulatory Oversight and Financial Integrity

The involvement of the CIB and the gravity of the charges highlight the critical need for robust corporate governance in the banking sector. Financial institutions are the backbone of the economy. Therefore, any breach of trust or legal non-compliance by their leaders must be addressed swiftly and decisively.

Transparency and Data: Modern banking relies heavily on data systems. The investigation will undoubtedly involve a deep dive into the bank’s digital transaction records and internal audits. Technology plays a crucial role in enabling investigators to trace complex financial trails and identify patterns of misuse.

Impact on Stakeholders: Such incidents can erode public confidence in the financial system. They also necessitate a review of internal checks and balances to prevent future occurrences. The banking sector needs to continuously upgrade its risk management and compliance frameworks.

High Court Grants Extension

Patan High Court on Monday granted CIB permission to hold the executives in custody for five additional days of investigation. This extension, confirmed by CIB Spokesperson Shiva Kumar Shrestha, gives investigators the necessary time to compile evidence.

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The CIB will use this period to solidify their case regarding the alleged banking offenses and the improper allocation and use of credit funds.

The investigation is a strong signal that regulators are actively enforcing compliance. It also shows they are prepared to prosecute high-ranking officials who are suspected of violating the law.

The Digital Forensics Angle

For an ICT-focused audience, it is important to note the nature of the investigation. Unraveling multi-million-rupee financial crimes often requires sophisticated digital forensics.

• Audit Trails: Investigators will be analyzing digital audit trails to pinpoint when and how policies were breached.

• Communication Records: Encrypted communications and digital documents are key evidence sources.

• Transaction Analysis: Advanced analytical tools are used to process huge volumes of transaction data, linking the executives’ decisions to the flow of misused funds.

This case serves as a powerful reminder for all corporate leaders about the permanent digital footprint their actions leave behind. Regulatory bodies are increasingly equipped with the tools to follow this data trail effectively.

What Happens Next?

The next five days will be crucial. CIB’s investigation is expected to produce significant findings. Depending on the outcome, the executives will face charges in court, or the case may proceed differently.

The banking sector and the wider business community are closely watching this development. They await the official results of the CIB probe, which will surely influence future compliance standards across the industry.

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