Nawaz Sharif exposed: Malik dusts off 14-year old FIA inquiry report

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The latest corruption charges leveled by Interior Minister Rehman Malik against the Sharif brothers were actually part of a comprehensive investigation report compiled by Malik as the additional director general of the Federal Investigation Agency (FIA), which he had submitted to then President Rafiq Tarar in September 1998, seeking a high level inquiry against then Prime Minister Mian Nawaz Sharif. Speaking at a news conference in Islamabad the other day, with a pile of files lying in front of him, Malik claimed that he had in his possession all documentary evidence and that he would file a reference with the National Accountability Bureau (NAB) against the Sharif brothers next week. Asking the Supreme Court to take note of fraudulent extraction of money by the Sharifs, the interior minister said he would be pleased to appear before the apex court with all relevant documents to prove his allegations. In fact, the charges leveled by Malik are by and large rehashed account of old allegations, contained in a 100-plus page report which he had compiled before being suspended by the second Sharif government following the dismissal of the second Bhutto government in 1996. Malik, who had emerged as one of the most powerful bureaucrat during Ms Bhutto’s second tenure, was dismissed from the FIA by the Sharif government in October 1998, shortly after he sent the inquiry report in question to President Rafiq Tarar, seeking action against then Prime Minister Nawaz Sharif. Malik wrote in a covering letter addressed to President Tarar and attached with the inquiry report: “I am submitting this report directly to you because I do not expect any action by the official hierarchy who at the moment are mostly political appointees. I have already been pressured to hand over all this record to Prime Minister’s Secretariat, where I fully well know the fate it is going to meet. I have also been warned to keep my lips tight, otherwise, my services shall be terminated and I again would be jailed in false cases. In brief, the extent of corruption and money laundering are staggering. I leave it to your absolute wisdom and judgment to determine the moral and constitutional justification of a person like Nawaz Sharif to hold the sacred office of prime ministership of an Islamic republic”. A brief summary of the investigation report compiled by Rehman Malik and submitted to President Tarar on September on 24, 1998 (copies of which were also sent to the then Chief Justice of Pakistan Justice Ajmal Mian and the then Chief Ehtesab Commissioner Justice (retd) Ghulam Mujaddad Mirza) is being reproduced below. Although no action was taken by any of them: “Mian Nawaz Sharif during his tenure in power as Finance minister (1984-85), Chief Minister (1985-90) or as Prime Minister of Pakistan (1991-93 and 1996-1999) managed to acquire unparalleled industrial power. This unprecedented power and wealth was in fact amassed through evasion of taxes, import duties and other devious means such as kickbacks fromillegal grants, privatization of public property and money laundering. Mian Nawaz Sharif today owns huge sums of money in the form of foreign exchange and property primarily in Switzerland and the UK. He is in certain cases the sole owner or the major shareholder in the name of his son and his wife in the 30 odd industrial units of his family. His accumulation of wealth has especially been in view of the fact that at the time of Independence in 1947, the Sharif family only owned a modest mill under the name of Ittefaq Foundries. During the period 1980-90 when Nawaz Sharif was Finance Minister and later Chief Minister of Punjab, the number of industrial units owned by his family rose from one to nine. However, during his first stint (1990-93) as prime minister, the number of his industrial units rose up to 30. “According to the testimony of two Peshawar-based Hawala dealers, the Sharif family illegally sent funds abroad regularly, to be converted into foreign exchange. Between 1988 and 1991, an amount of Rs56,896 million was sent out of the country. Khalid Siraj, first cousin and business partner of Mian Nawaz Sharif has disclosed in a statement the Sharif family’s misdeeds and the transfer of funds abroad and the purchase of assets overseas. “During 1988, $7,580,000 was remitted from the Bank of Oman, Sharjah to the Bank of Oman, Lahore. Against this money, Foreign Exchange Bearer Certificates (FEBC) worth Rs145.06 million were distributed among close members of Nawaz Sharif’s family. During this period of money laundering of Rs145.06 million by his family, Sharif paid only Rs897 in income tax. The purpose of the Hawala operation was to whiten Nawaz Sharif’s black money because the source of illegal money with which one buys FEBCs cannot be investigated. The money used in converting into FEBC is termed “white”. The other purposes of the Hawala operation were to evade income and wealth taxes, as FEBCs are not treated as taxable and to earn high rates of interest on Foreign Exchange Bearer Certificates. “Mr Khaista Khan and Jamshed Khan, two well-known Hawala dealers of Peshawar, were used to siphon off large amounts of Sharif family funds through the bank accounts of the dealers maintained in Peshawar. The money was sent from Pakistan to the Bank of Oman in the UAE and elsewhere. The money was exchanged into foreign currency and repatriated in the name of the 43 Sharif family members, including Nawaz Sharif, his brother, sister, mother, etc. Having established a solid monetary foreign exchange base abroad, Nawaz Sharif then took steps to convert his bulk money into white under the facility of Economic Reforms Act 1992. To do so, he utilized the services of Javed Kayani, a nephew of Sheikh Saeed from Washington and a Director of Rai Textile Mills, Arooj Textile Mills and Chanar Sugar Mills. Sheikh Saeed is one Nawaz Sharif’s closest friends. “Research has revealed of that in August 1992, Javed Kayani, a trusted friend and front man for Mian Nawaz Sharif, opened three fake foreign currency accounts in the name of Sulman Zia, Mohammad Ramzan and Asghar Ali at Habib Bank AG Zurich, Davis Road, Lahore. Large amounts of foreign exchange from Switzerland and other sources were transferred to these three fake accounts. The bank record further reveals that then there were transfers of payments from these accounts to Sheikh Saeed. Javed Kayani opened another set of three accounts at Bank of America, Lahore in the names of Kashif Masood Qazi, Sikandra Masood Qazi and Nuzhat Gohar Qazi. The records show the transfer of large sums of money in the form of Dollar Bearer Certificates from the fake account of Sulman Zia to the account of Kashif Masood Qazi. This was used as collateral by the Sharif family for the sanction of a loan in Pak Rupees for their Hudabiya Engineering Limited. The directors of this mill are Mian Hussain Nawaz, Mrs Kulsoom Nawaz Sharif, Mian Muhammad Sharif and Mian Shahbaz Sharif. The link between the fake account of Sulman Zia (a person who does not exist) with the Sharif family through Hudabiya Engineering is proved beyond any doubt by bank official records. “Part of the laundered money - nearly 350, 000 dollars from the fake account of Sulman Zia was then transferred by Nawaz Sharif’s family in January/February 1993 to Shamrock Consulting Corporation [registered c/o Ansbacher (BVI) Limited PO Box 659 Road Town, Tortola, British Virgin Islands] through its account at Lloyds Bank, Stock Exchange, London. The 350,000 dollars was then transferred from Lloyds Bank to one Hans Rudolf Wegmuller, a Director of Banque Paribas en Suisse Zurich who is also a Director of Ansbacher Switzerland, a fiduciary company which acts on behalf of the Sharif family. The British Virgin Islands are a notorious haven for money laundering used by corrupt rulers of Third World countries and the Drug Barons of South America and Europe. “It has also come to light that in order to acquire property in the UK, the Sharif family utilized the services of one Mr Urs Specker, General Manager Ansbacher Switzerland. According to the records of the HM Land Registry in UK and other official documents, it was established that this individual purchased for the Sharif family four luxury flats - 16, 16a, 17 and 17a Avenfield House, London - situated in a very costly and up market area, for a total sum of $5 million, equivalent to Rs30 crore. The transaction was arranged through a firm of solicitors, namely Dibb Lupton Broomhead in 1993, 1995 and 1996. Wegmuller administers the four luxury flats, which are owned through other two offshore companies called Nielson Enterprises Limited and Nescoll Limited, both registered in the British Virgin Islands. These two companies are controlled by Urs Specker of Ansbacher Switzerland. This circumlocutory course, per force was adopted for the sake of secrecy. “The above property was purchased with money laundered in Switzerland and the UK and ill gotten wealth earned through corrupt practices in Pakistan. All this wealth and assets were never declared by Sharif family before the Income and Customs Authorities in Pakistan. Detailed scrutiny of the documentary record has revealed that most of the money amount was siphoned off from the Pakistani Banks. Against this background, it is now easy to understand why the Sharif family has defaulted on its outstanding loans of Rs10 billion to Pakistani banks. The total loan of the Sharif family as it stood in 1983 was Rs35.30 crore while in 1985 it turned into Rs84.30 crore. In February 1989 this amount more than doubled up to Rs225.10 crore. In April 1993, the loan was piled up to a staggering amount of a Rs570.50 crore. By December 31, 1993 this sum had soared to Rs614.84 crores and touched the figure of Rs1,000 crore in 1998,” added Rehman Malik’s inquiry report. On the other hand, however, PML-N spokesman Senator Pervaiz Rashid has already rejected Rehman Malik’s allegations against the Sharif family as a ‘rotten pack of white lies’, adding that he was at liberty to take them up with a competent court to prove their authenticity. Pervaiz Rashid said that four years’ tenure of the PPP was reflective of loot and plunder committed by the ruling party. Therefore, he said, instead of leveling false allegations against the Sharif family, Rehman Malik should give account of billions of rupees looted by his party leadership. On his part, Rehman Malik is determined to file a reference with the National Accountability Bureau (NAB) against the Sharif brothers on charges of money laundering. As things stand, three corruption cases against the Sharif brothers, which were initiated by the Musharraf regime, are already pending with the accountability courts of Rawalpindi. Besides, eight investigations and two inquiries are pending with the NAB, pertaining to the alleged corruption and misuse of authority by the Sharif brothers. A senior PML-N leader rejected Rehman Malik’s claims as a pack of lies. He maintained that had there been any truth in Malik’s report it would have caught attention of Gen Pervez Musharraf who had usurped power from an elected prime minister. The leader said that the PPP has been in power for four years, and questioned why Malik did not go to press earlier as he claims that it was he who had investigated the matter and had presented the report to the then president Rafiq Tarar.