Kathmandu- A major insurance fraud involving staged road accidents and forged police documents has been uncovered in Kathmandu, exposing collusion between police personnel, insurance employees, vehicle owners, and drivers. Investigators say insurance claims worth Rs 8.1 million were illegally collected by fabricating 29 fake accidents, of which 27 claims were successfully paid.
Following an investigation by the New Baneshwor Police Circle, the District Attorney’s Office, Kathmandu, has filed a case at the Kathmandu District Court against 31 individuals on charges of fraud and document forgery.
Only One Arrested, 30 Absconding
Out of the 31 accused, only 44-year-old Hari Budhathoki of Thori Rural Municipality–10, Parsa, has been arrested so far. He was taken into custody from Jadibuti on 1 Poush. Police say the investigation gained momentum after documents related to fake accidents were recovered from him.
The remaining 30 accused are absconding, including police personnel and insurance company employees. Among them is Dhruv Shahi, a police constable at the New Baneshwor Police Circle, who is alleged to have facilitated the preparation of fraudulent police reports.
Forged Police Reports and Signatures
Police officials stated that since a police report is mandatory to claim vehicle insurance, the accused forged official police letterheads and signatures of inspectors to legitimize the fake accidents.
According to SSP Ramesh Thapa, Chief of the District Police Complex, Kathmandu, signatures of Inspector Shyam Khanal and Senior Inspector Ramhari Karki, who served at the New Baneshwor Police Circle between Baisakh 2081 and Bhadra 2082, were forged to prepare accident reports.
“The investigation confirmed that everything—from letterheads to official signatures—was forged to withdraw insurance money,” SSP Thapa said.
Modus Operandi
Police investigations reveal that Hari Budhathoki, who has been driving since 2056 and owns a minibus (Ba 2 Kha 7814), coordinated with Bikesh Kunwar, an employee of Nepal Micro Insurance, to execute the fraud.
Budhathoki’s role allegedly involved identifying vehicles and owners willing to participate, arranging fake accident scenarios, and coordinating with police personnel to obtain fabricated reports. Fake medical treatment records, including claims of treatment at B&C Hospital, were also used to strengthen insurance claims.
Police say evidence suggests that Kunwar approved insurance payouts based on forged documents.
Court Proceedings Ongoing
Statements of the accused are currently being recorded before Judge Ishwori Prasad Bhandari at the Kathmandu District Court. After completion of statements, the court will conduct a closed-door hearing and decide whether the accused will be released on bail, remanded in custody, or tried while in detention.
Authorities have intensified efforts to arrest the remaining accused and have indicated that further arrests are likely as the investigation expands.
