ISLAMABAD: National Accountability Bureau (NAB) has expanded the scope of its inquiry against Ali Jahangir Siddiqui, an aide to Prime Minister Shahid Khaqan Abbasi and Ambassador to the United States, into a money laundering scandal worth Rs3.3 billion for the acquisition of an Italian brand.
The anti-graft watchdog, NAB, has expanded its scope of inquiry over money laundry allegations involving M/s Azgard Nine Limited (ANL), JS Global Capital Limited, Swiss Bank Julius Baer and Securities and Exchange Commission (SECP).
Allegedly all the transactions were made through Swiss Bank Julius Baer and coupled with SECP’s efforts to hide and regularise illegal remittances of €23.75 million for the acquisition of foreign brands.
Available copies of NAB, State Bank of Pakistan’s (SBP) documents and a letter of Transparency International Pakistan (TIP) transpire that ANL obtained permission from SBP to remit €23.75 million to Sweden through HSBC Bank for the acquisition of Italian brand. SBP granted permission and also imposed seven conditions including bringing back the profit to Pakistan.
On the contrary, ANL allegedly did not acquire committed brand/s as stated by them in their request to SBP. Moreover, in gross violation to the terms of SBP permission, ANL did not send the remittance in five equal instalments and remitted €23.75 million in one installment after 8 months and 13 days.
Moreover, according to the documents a receipt dated December 29, 2008, confirmed a transaction worth €23.75 million with bank code DNBIDN 269ZA, which does not belong to HSBC Pakistan.
It is also learnt that ANL was to acquire foreign brands; however, ANL allegedly committed illegality of syphoning of funds on the pretext of purchase of Italian brand/s but purchased Montebello SRL for marketing of ANL products. ANL did not acquire committed brand/s as stated by them in their request to SBP. The permission granted by the SBP was for the acquisition of foreign brand/s only.
This anomaly was detected by NAB while conducting a corruption inquiry in 2016 from the audited accounts of ANL, for the year ended 2008, that reflected a remittance worth €23.75 million for the purchase of an Italian company.
SECP also initiated an inquiry into the said matter; however, ANL did not provide record and satisfactory response to SECP. ANL said that records pertaining to SBP and SECP were misplaced and went missing during the course of the inquiry. Moreover, ANL in an alleged attempt to hide the matter, filed consolidation with SECP in 2015, which was followed by a Rs13 million penalty on ANL.
It is also learnt that ANL instead of acquiring Italian brand used the amount for a shell company, and in this way cheated the public at large public and SECP as well.
TIP in a letter dated May 24, 2018, to SBP Governor Tariq Bajwa, has urged SBP to initiate an investigation into money laundry of Rs3.3 billion and non-compliance of the seven conditions and rules of SBP by ANL. Moreover, TIP has requested that if fraudulent and illegal activities are found, actions should be taken against all responsible including ANL, HSBC Bank, Bank Julius Baer etc and officers of SECP for their futile efforts to illegally regularise syphoning of money.
Further, the result of SBP investigation should also be reported to NAB for action under Section 9 and 10 of National Accountability Ordinance, 1999 and the money if laundered should be brought back to Pakistan with interest, said TIP in its letter.
It is worth mentioning that earlier NAB had authorised an inquiry against owners and directors of Azgard Nine Limited (ANL) on the allegation of corruption and corrupt practices as defined in section 9(A) of National Accountability Ordinance, 1999 and Schedule thereto. NAB had also summoned SECP chairman to appear and record plea in a Rs40 billion graft case against Ali Jahangir Siddiqui.
Moreover, NAB has already interrogated National Bank of Pakistan (NBP) former group chief Nadeem Anwar Ilyas, and Invest and Finance Securities former CEO Sohail Dayala in its investigation against Pakistan’s envoy Ali Jahangir Siddiqui. NAB has also investigated SECP Additional Director Tariq Ahmed and Additional Director Aishah Ali Raza, as both were appointed as inspectors to conduct an investigation regarding the facts, transactions and events relating to Montebello (MBL), Italy in 2008 by M/s Azgard Nine Limited till liquidation of MBL in 2014.
On March 8, Prime Minister Shahid Khaqan Abbasi approved the appointment of Ali Jahangir Siddiqui, son of prominent businessman Jahangir Siddiqui, as Pakistan’s Ambassador to the United States. Siddiqui has been serving Abbasi as a special assistant, advising the prime minister on economic and business matters and is chairman of JS Bank Ltd and son of stockbroker-turned-banker Jahangir Siddiqui.
He has previously served as a director in Airblue — which is also connected to the prime minister’s family — Lucky Cement, Azgard Nine, and numerous other companies.
Pakistan’s envoy to US Ali Jahangir Siddiqui had been accused of syphoning off funds amounting to €23.75 million in 2008 for the purchase of an Italian company, Montebello SRL, using a foreign company, Fairytale SRL Sweden, which resulted in a loss to the company and shareholders.
Moreover, he was also accused of selling shares of Agritech Ltd to different financial and government institutions through Azgard Nine at a higher price than market price to settle the loan defaults of the company, which resulted in an approximate loss of Rs40 billion to the institutions.