The plane truth: scandal at 40,000 feet

Dogged investigative journalists uncovering a controversial and potentially corrupt business deal? Legal action against 32 (yep, that’s not a typo, thirty-two) people involved? It should be music to my ears.

Sadly the fact that the dodgy deals have damaged two of Nepal’s biggest pension funds makes it sound less ‘music’ and more ‘nails on a chalkboard’. 

But that’s the situation. And that legal action does give me hope for some accountability. Those criminal charges are only thanks to the journalism done by Deepak Adhikari and Rudra Pangeni. 

Their investigation, published by the Center for Investigative Journalism Nepal alongside Finance Uncovered, revealed murky financial structures that were allegedly exploited by officials during Nepal’s purchase of two massive jets (for the plane spotters out there, they were Airbus A330-200s).

When Nepal purchased the planes there was a national celebration. Women wearing traditional Nepali dresses and flower garlands greeted the jets on arrival at Kathmandu’s international airport. 

Yet behind all this pomp and pageantry lurked a strange arrangement: Nepal did not buy the planes directly from Airbus. Instead, the deal went through three intermediary companies: 1) German Aviation Capital (GAC), 2) Hi Fly Transportes Aereos, and 3) AAR Corp. Now that arrangement is mired in allegations of corruption. 

To give you a wee bit of background on that alphabet soup of companies: 

• GAC is a big European aircraft trading and leasing company. It has an interesting past; in 2015 it sold nine Airbus planes to Al Naser, an Iraqi-based company that was sanctioned by the US. 

• Hi Fly Transporters Aereos is owned by a pair of Portuguese tycoons, and is better known here in the UK as one of the companies linked to the Home Office’s migrant deportations. 

• AAR Corp is an American aviation company that has been under investigation in South Africa for another instance of alleged corruption. Deepak Sharma, AAR’s president of international supply chains, is one of the people listed in the Nepali court charges. 

To pay for the planes Nepal’s national airline took out loans worth around $230m from two of Nepal’s biggest pension funds. The funds are used by 1.3 million Nepalis saving for their future. 

But that’s where the strange structure of the deal comes in. Nepal Airlines ended up paying more than the jets were worth through the intermediaries. This means the airline has more liabilities than assets (effectively it’s bankrupt), and the two pension funds are not receiving regular repayments – which means ordinary people’s retirement savings are at risk. 

A committee of Nepali parliamentarians concluded that the airline lost about $40m during the deal for the planes. Nepal has a GDP of about $44bn so this one mismanaged deal lost the country about 0.1% of the total value of the economy. 

 ~ That’s a very basic summary of the deal but if you want to delve deeper into the shady financial arrangement, buckle up and read the full investigation ~

This isn’t a TBIJ investigation – although we have worked with Rudra before – but even from the outside I can tell how much work went into this. 

Deepak and Rudra gave everyone involved the opportunity to respond to the allegations made against them – as responsible journalists always do to make sure that their reporting is balanced and fair – and you can read these in the full article.

Complicated part of the story = done. Now for the result. Last month, Nepal’s corruption watchdog filed a case against 32 people for their alleged involvement. It’s seeking about $11m in compensation. 

Those 32 include a former minister, high-level sitting and retired government officials and representatives of the aircraft suppliers. 

The two reporters told me they “felt proud to have contributed to the investigation into Nepal’s largest-ever purchase. Investigations such as ours take time and are not widely read because the issue isn’t interesting for most readers.”

They said: “We are hopeful that the laws will prevail because we must have faith in our institutions. Corruption is a major problem in Nepal, where people are frustrated by lack of progress and bad governance. So a lawsuit like this one has raised hopes for accountability and conviction.”

Hats off to Deepak and Rudra for untangling such a knotty tale and publishing a story that forced the wheels of justice to turn. We’ll be watching the case closely and hoping for an even better outcome for the hundreds of thousands of Nepalis whose precious pension pots are still at risk. 

“The Ferret is committed to reporting on animal welfare issues. It’s been one of the big topics that we have covered since 2015. 

Scotland was supposed to have banned the hunting of foxes with packs of dogs but I started getting tipped off that some fox hunts in Scotland were allegedly flouting the ban. We got information from some hunt saboteur groups and I went out with them to monitor fox hunts. I also went out with undercover investigators with the League Against Cruel Sports. 

There were basically allegations that the police in Scotland had been acting as a personal security force for some of the hunts and our investigation gave credence and backed up those claims. We had footage of officers detaining people and threatening them with arrest for monitoring fox hunts. We were even threatened with arrest by Police Scotland while investigating. 

There’s a lot of campaigning groups and people who’ve done a lot of work to highlight illegal foxing since 2002. But we would like to say that our investigations have influenced the national debate and the public with important facts about fox hunting. 

We investigated claims that the law was being broken. We proved that people were still hunting and law was being breached in Scotland. And there was a change of legislation. It’s pleasing to know that you’ve played a part, even though it's a small part, in bringing about some sort of change.”

You can read more about how The Ferret covers animal welfare here

Thank you again for reading and for taking an interest in the journalism that’s changing the world. I really believe that it’s important work, and so it’s amazing to know that we’re all on the same page. As always, do get in touch if you want me to cover a specific story that matters to you – I’d love to hear from you.

I’ll leave you with something quite cool that happened this week that I want to talk more about soon, where good journalism has been put to work to help people escape exploitative jobs. 

A team at TBIJ has been reporting on care workers trapped in harrowing working conditions by their visas for the past six months. Because of how the visa works, a person’s right to work in the UK is tied directly to their employment, and often the only way to escape a bad job is to find a new one in the same industry. Many workers told the team that not knowing which care providers can sponsor workers made it difficult to change jobs and escape exploitative situations. 

But as part of the reporting, TBIJ had found a way to take the government’s list of skilled worker visa sponsors and whittle it down to just care providers. This week, the Autonomy Institute turned that into a database of UK care providers licensed to sponsor workers’ visas. It can be searched by postcode, meaning workers won’t have to move hundreds of miles to leave abusive jobs. 

I love seeing journalism turned into tools like this, taking a story from a moment in time to something that can be used over and over again. Know any more like it?

Have a lovely week!