Krishna Bahadur Mahara, CPN Maoist Centre's vice chair and former house speaker, has been arrested.
Inspector General of Police (IG) Basant Bahadur Kunwar informed about Mahara's arrest in Kapilvastu. He is being transported to Kathmandu.
A high-level investigation committee set up to examine gold smuggling cases had recommended that Mahara be prosecuted.
On Sunday, Home Minister Ravi Lamichhane directed the police to conduct an investigation into all individuals implicated in the gold smuggling case.
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