A Nepalese investigation has revealed a nearly $20 million insurance scam involving guides and trekking businesses who allegedly orchestrated fraudulent mountain rescues near Mt. Everest, according to a report by The Kathmandu Post [1]. The scam included guides lacing hikers' food and manipulating symptoms of altitude sickness to justify helicopter evacuations, with some guides and hotel staff coached to scare trekkers into believing immediate evacuation was necessary for survival [1]. In certain cases, Diamox tablets and excessive water intake were used to induce symptoms, and food was laced with baking powder to make hikers unwell [1].
The police recorded instances where multiple individuals were picked up in a single helicopter flight, but insurance claims were filed as separate rescues to inflate payouts [1]. Hospitals played a role in the scheme, reportedly paying 20% to 25% of insurance money to trekking businesses and chopper operators for patient referrals, while trekking guides benefited from inflated invoices [1]. Tourists were sometimes offered money to participate in the scam [1].
Between 2022 and 2025, investigators found 4,782 foreign patients serviced at implicated hospitals, with 171 cases verified as fraudulent rescues [1]. Era International Hospital received deposits of over $15.87 million, and Shreedhi International Hospital received more than $1.22 million related to these activities [1]. Mountain Rescue Service conducted 171 fake rescues out of 1,248 charter flights, earning approximately $10.31 million from insurers, while Nepal Charter Service executed 75 fake rescues out of 471 flights, claiming $8.2 million. Everest Experience and Assistance was allegedly linked to 71 suspicious rescues out of 601 flights [1].
The investigation was initially prompted by reporting in 2018, leading to government reforms and a 700-page report. However, the Nepal Police’s Central Investigation Bureau (CIB) reopened the case last year after discovering the fraud was increasing [1].
CONCLUSION
The Nepalese insurance scam involving fraudulent mountain rescues has exposed significant financial misconduct within the trekking and rescue industry, with millions of dollars siphoned through fake claims and manipulated evacuations. The investigation has prompted renewed scrutiny and reforms, highlighting the need for tighter oversight in Nepal's adventure tourism sector. Market sentiment is negative due to the scale and persistence of the fraud.