NAB, FBR to stay away from Panama Papers probe

ISLAMABAD: The National Accountability Bureau (NAB) and Federal Board of Revenue have decided to stay away from probing the Panama Papers.

The Operation Division of the National Accountability Bureau (NAB) has “put on hold” the file on PanamaLeaks showing the names of Prime Minister Nawaz Sharif’s children even before the initiation of a formal inquiry, it has been learnt.

Informed sources said that following the Operation Division’s decision on the official file, the PanamaLeaks issue had been frozen now in the top-most anti-corruption body of the country. This decision has been taken even before the initiation of a formal inquiry into the matter that has jolted the Nawaz Sharif government. “We were not even at the stage of complaint verification and have now been stopped from even moving the file,” an informed official source said.

The source said that the file, which clearly mentions the prime minister, his children and the PanamaLeaks, contains unambiguous “put on hold” order of the Operation Division. The source said that this decision was reflected on the main sheet of the file.

This development will practically freeze even the movement of the file unless the NAB management decides to initiate some action.

Before the “put on hold” decision, a deputy director of the Operation Division had reportedly written a letter to the Lahore NAB for possible linking of the PanamaLeaks disclosure about the Sharifs with an already pending inquiry against the ruling party.

The News did a story on the said issue a few days back. Although, the NAB avoided giving any reaction on the story yet a senior official of the NAB had contacted this correspondent and said on condition of anonymity that the top management of the Bureau had checked with the concerned persons, both in Islamabad and Lahore NAB offices, but could not find any track of the letter.

The NAB official added that the Bureau did not want to issue any clarification or rebuttal to The News story to avoid a controversy. However, the sources in the NAB Lahore confirmed that Rana Muhammad Ali, the Additional Director Staff of DG NAB, had received the letter pertaining to the Nawaz Sharif case from Deputy Director Operation Division Mufti Abdul Haq. When this correspondent contacted Rana, he was shy to discuss the issue. “We are not authorised to talk to media persons,” he said.

Following the PanamaLeaks, it was reported by this newspaper earlier this week that things were silently moved against Prime Minister Nawaz Sharif in NAB on the issue of PanamaLeaks with the NAB Lahore office receiving a letter from the bureau’s headquarters to possibly link the Leaks’ disclosures with an assets case inquiry of the Sharifs.

The News story on the subject, which appeared on Wednesday, had reported that the Lahore office was conveyed that if in the already-pending inquiry against the Sharifs, the offshore companies as revealed by the PanamaLeaks were not reflected, then these should be linked with the case.

It is said that there was a probe initiated in 2000-2001 in NAB about the London properties case against Nawaz Sharif and others regarding owning of Aven Field properties in London. The same Aven Field properties are now reflected in the offshore companies and as per the statement of Hussain Nawaz belong to him.

The NAB sources had claimed that the chairman NAB was not in the know of the letter written to the Lahore office in connection with the PanamaLeaks disclosure about the prime minister. Spokesman of the NAB Nawazish Ali Asim, when contacted, had however said that he was not updated on the subject. He was not available to comment on the Operation Division’s decision.

Meanwhile, another senior NAB source told this correspondent that for an overall probe into the PanamaLeaks, the Bureau held discussions and decided to wait for the formation of the Judicial Commission. The source said that the NAB will offer its services to the commission if so required by the body for initiation of a probe into the matter.

Over 200 Pakistanis have been reportedly identified in the PanamaLeaks and there are reports of disclosure of more than 400 names of such Pakistanis in the follow-up story by the ICIJ next month.

According to the NAB source, primarily the PanamaLeaks issue has two dimensions in case of any illegality involved. Either it’s an issue of tax evasion or the case of money laundering.In case of tax evasion, it is said that the concerned department to initiate action is the Federal Board of Revenue. In case of money laundering, the source said the subject pertains to the Federal Investigation Agency.

The NAB’s direct relevance, it is said, becomes obvious in those cases and names which are or have already been under the focus of NAB for different allegations.Meanwhile, after an initial show of intent, the Federal Board of Revenue (FBR) has backed-off from probing owners of offshore accounts mentioned in the Panama Papers, The News has learnt.

The national tax collecting body, which had earlier decided to write letters to the authors of the Panama Papers to ascertain the tax dodgers among the 200 owners of offshore companies, has now succumbed to the government pressure and decided to turn a blind eye towards the issue. A top FBR official told The News that the matter will only be probed if the Panama government officially shares information with Pakistan.

Sources said the PanamaLeaks were discussed in detail at a recent FBR meeting, but the officers were asked to consider the matter a closed transaction. The news of FBR, which is controlled by the government, probing the Panama Papers had come as a pleasant surprise in a society where elite are always considered untouchable and institutions are run like personal fiefdoms. The FBR is the leading tax authority of the country, but it does not enjoy autonomy like tax bodies of other countries. Successive governments have maintained a tight control over the body to protect the vested interests of the elite and the rich, most of whom evade taxes.

The National Assembly’s Standing Committee on Finance and Revenue had also asked the FBR to investigate the tax evasion by persons mentioned in the Panama Papers, but the Board has cited legal limitations in probing the issue.

“The Board is not probing the PanamaLeaks and it never intended to do so as under the Pakistani laws, the FBR cannot go beyond five years to probe any tax dodging by the citizens,” Member FBR Dr Muhammad Iqbal, who is also the spokesperson of the Board, told The News. He denied the impression that the tax body was under government pressure to back off from probing the Panama revelations.

He said the Board will not contact the ICIJ directly to get more information about 200 Pakistanis mentioned in the leaks. He said under the current laws, the declaration by taxpayers has legal sanctity so the FBR cannot review their statements on the basis of newspaper reports.

“Only the report of some official body like the Panama government can allow the  FBR to review the assets declared by registered taxpayers,” he said.The FBR official said Pakistan has no agreement with the Panama government for sharing of taxpayers’ information although the country has such agreements with over 70 other countries.

While the FBR is dragging its feet on Panama Papers, UK’s Her Majesty Revenue and Customs (HMRC) is probing the Panama Leaks in collaboration with the Consortium of Investigative Journalists (ICIJ), the body behind the massive data leak.

The HMRC had approached the ICIJ for access to the material to probe the UK nationals for possible tax fraud.