Sunil Paudel NITC Corruption High-Compute Infrastructure Nepal Tech Scam CIAA Investigation World Distribution Nepal Digital Governance Special Court Verdict

Tech Corruption Scandal Breaks: Former NITC Director Sunil Paudel Convicted in $1.2M High-Compute Infrastructure Fraud

A landmark corruption verdict has convicted Sunil Paudel, former Executive Director of Nepal's National Information Technology Center, and four others for embezzling Rs160 million in a high-compute infrastructure procurement scam involving security apps and networking equipment.

Apple Nepal

In a major blow to Nepal's digital governance integrity, the Special Court has convicted Sunil Paudel, the former Executive Director of the National Information Technology Center (NITC), along with four other individuals in a high-stakes corruption case centered on the procurement of high-compute infrastructure. The verdict, delivered by a bench led by Chairman Sudarshan Dev Bhatta, marks the culmination of investigations into irregularities involving security applications and networking equipment.

The Scandal: Rs160 Million Embezzled

The court found that the accused orchestrated a scheme to embezzle approximately Rs160 million during the fiscal year 2019-20 procurement process. The Commission for the Investigation of Abuse of Authority (CIAA) had previously filed the case, seeking the recovery of Rs158.85 million alongside imprisonment and fines for the misappropriation of public funds intended for the nation's digital backbone .

The convicted group includes key NITC officials and a private contractor:

  • Safal Shrestha (former Director of NITC)
  • Ramesh Pokhrel (Assistant Director)
  • Ram Sharan Gaik (Computer Engineer)
  • Arun Shrestha (Chairperson of World Distribution Nepal Pvt. Ltd., the contract recipient)

Court Sentencing and Legal Consequences

The Special Court has sentenced all five convicted individuals to imprisonment and imposed significant financial fines. The judgment addresses the irregularities in purchasing critical security applications and networking gear, which were supposed to enhance the center's computational capabilities but instead resulted in massive financial loss to the state .

This conviction adds to a growing list of legal troubles for Paudel. He was previously sentenced to nine years in prison and ordered to pay Rs232.66 million in restitution and fines for a separate corruption case involving the National Payment Gateway in April 2024 . Additionally, the CIAA has filed multiple other cases against him, including a fifth case related to alleged bribes of $280,000 deposited in a Singapore bank account .

Context: A Pattern of Irregularities

Paudel's legal history reveals a pattern of alleged misconduct in IT procurement. While he was recently acquitted in a corruption case related to Nepal Telecom's billing system upgrade in July 2026, the convictions in the high-compute infrastructure and payment gateway cases demonstrate the court's strict stance on verified financial irregularities in the tech sector .

The World Distribution Nepal Pvt. Ltd., represented by Arun Shrestha, was identified as the company that received the tainted contract, highlighting the collusion between public officials and private vendors in these schemes .

Impact on Nepal's Digital Future

This verdict sends a clear message to the tech procurement sector in Nepal: accountability is non-negotiable. As the country pushes for advanced high-compute infrastructure to support AI, data analytics, and national digital services, ensuring the integrity of these procurement processes is critical for future technological growth.