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April 9, 2013

The truth about Rs3.48 bn Sharifs loan default

April 9, 2013

ISLAMABAD: The National Accountability Bureau (NAB) desperately awaits the long-overdue judgment in the Rs3.48 billion ‘willful loan default case’ against Nawaz Sharif and his family members concerning the Hudabiya Paper Mills Private Limited.
The case hearing was concluded on December 3, 2012 by a two-member Rawalpindi bench of the Lahore High Court, declaring that the verdict was being reserved to be announced ‘soon’.
The division bench comprising Justice Khwaja Imtiaz Ahmed and Justice Farrukh Irfan Khan had heard for six months three identical petitions filed by Nawaz Sharif, Shahbaz Sharif and several other family members, seeking cancellation of the corruption cases which were filed against them by the NAB. The cases pertaining to the Hudabiya Mills, Ittefaq Foundries and the Raiwind assets were prepared in 2000 when the Sharifs were detained in the Attock Fort following the overthrow of their government by Musharraf. As the Sharifs eventually proceeded to Saudi Arabia in December 2000 after signing a pardon deal with General Pervez Musharraf, these references were adjourned sine die on April 4, 2001.
The NAB once again took up the pending cases in 2007 as Nawaz Sharif returned home. On August 8, 2007, the NAB filed an application with the Lahore High Court for revival of the pending corruption cases against the Sharifs. But the NAB application was finally thrown out by the Rawalpindi bench of the Lahore High Court in August 2008, maintaining that the cases were not routed through the NAB chairman. Yet another NAB attempt was halted by the court on the same grounds in February 2010. However, on a petition filed by the Sharifs, a division bench of the LHC headed by Justice Mansoor Ali Shah ordered the NAB on October 5, 2011 to return the confiscated assets of the Sharif family, including shares worth Rs100 million, prize bonds worth Rs115 million, documents of properties in Murree, Chaudhry Sugar Mills, Hudabiya Engineering Services, Hamza

Shipping Corporation, Ramzan Sugar Mills, etc.
On October 19, 2011, the Rawalpindi bench of the High Court comprising Justice Ijazul Ahsan and Justice Abdul Waheed Khan passed a stay order in favour of the Sharifs and directed an accountability court to stay further proceedings on corruption references. On September 15, 2012, the Rawalpindi bench of the Lahore High Court restrained an accountability court from pursuing the corruption case against the Sharifs till the matter was adjudicated by it. During subsequent hearing of the case on October 9, 2012, the division bench of the LHC, comprising Justice Khwaja Imtiaz Ahmed and Justice Sardar Tariq Masood, advised the counsel for the Sharifs to ask his clients to pay back the decades-old bank loans to get rid of one of the three corruption references.
Justice Khwaja Imtiaz Ahmed told Salman Butt, the counsel for Mian Nawaz Sharif and Shahbaz Sharif, “The Sharif family seems to have recovered its losses and it is believed that the family is now well-off and can easily return all the loans to the banks. The loans procured from different banks were the public money and it should be returned at the earliest.” On December 3, 2012, Justice Khwaja Imtiaz Ahmed and Justice Farrukh Irfan Khan of the Lahore High Court’s Rawalpindi bench reserved its judgment on the Rs3.48 billion ‘willful loan default case’ against the Sharifs concerning the Hudabiya Paper Mills after the NAB prosecutor Chaudhry Riaz Ahmed completed his arguments in the case.
In his arguments, Chaudhry Riaz Ahmed informed the court that there was sufficient material available with the NAB to proceed against the Sharif brothers in the Hudabiya Mills case, especially a hand-statement of Senator Ishaq Dar as the approver wherein he has charged sheeted the Sharifs. Quoting Dar’s statement, Ch Riaz Ahmed said several bogus bank accounts were opened on the instructions of Nawaz Sharif and his brother Shahbaz Sharif, depositing the laundered money and later transferring the money into personal accounts.
In the “State vs Hudabiya Paper Mills Private Limited case”, nine members of the Sharif family were accused of committing money laundering to the tune of Rs642.743 million. As per the NAB reference, the Sharif family allegedly deposited ill-gotten money in fake accounts which were opened in the names of other persons and the money from these accounts was used to pay off the bank loans of the defaulting Sharif companies. Mian Muhammad Sharif, Nawaz Sharif, Shahbaz Sharif, Abbas Sharif, Hussain Nawaz Sharif, Hamza Shahbaz Sharif, Mrs Shamim Sharif (Nawaz’s mother), Mrs Sabiha Abbas, Mrs Maryam Safdar and the former finance minister of the Sharif cabinet, Ishaq Dar are the main accused in the Hudabiya reference.
While concluding his arguments in the Hudabiya Mills case before a division bench of the LHC on December 3, 2012, the NAB prosecutor Chaudhry Riaz Ahmed narrated in detail the 43-page handwritten statement by Senator Ishaq Dar wherein he had accused the Sharifs of involvement in money laundering. As per the statement, which had been recorded before a District Magistrate, Lahore, on April 25, 2000, Dar accused the Sharif brothers of having used the Hudabiya Paper Mills as cover for money laundering during the late 1990s. Dar’s statement was recorded before a district magistrate in Lahore, after he was brought to the court from a jail by Basharat Shahzad, then serving as assistant director in the Federal Investigation Agency (FIA).
According to a senior NAB official, Ishaq Dar’s deposition was an irrevocable statement because it had been recorded under Section 164 of the Criminal Procedure Code (CrPC). Dar happens to be a high-profile PML-N leader who has always been considered close to the Sharif brothers. In fact, Dar’s son, Ali Dar, is married to Nawaz Sharif’s younger daughter, Asma Nawaz. Ishaq Dar confessed in his statement: “I opened two foreign currency accounts in the name of Sikandra Masood Qazi and Talat Masood Qazi with foreign currency funds provided by the Sharif family in the Bank of America by signing as Sikandara Masood Qazi and Talat Masood Qazi. All instructions to the bank in the name of these two persons were signed by me under the orders of original depositors, namely Mian Nawaz Sharif and Mian Shahbaz Sharif. The foreign currency accounts of Nuzhat Gohar and Kashif Masood Qazi were opened in Bank of America by Naeem Mehmood under my instructions (based on the directives of the Sharifs) by signing the same as Nuzhat Gohar and Kashif Masood Qazi.”
As per Dar’s statement recorded before District Magistrate Lahore on April 25, 2000, besides these foreign currency accounts, a previously opened foreign currency account of Saeed Ahmed, a former director of the First Hajvari Modaraba Company and a close aide of Dar, and of Mussa Ghani, the nephew of Dar’s wife, were also used to deposit huge foreign currency funds provided by the Sharif family to offer them as collateral to obtain different direct and indirect credit lines. Dar conceded that the Bank of America, Citibank, Atlas Investment Bank, Al Barka Bank and Al Towfeek Investment Bank were used under the directives of the Sharif family.
Interestingly, Dar also implicated himself by confessing before the magistrate that he — along with his friends Kamal Qureshi and Naeem Mehmood — had opened fake foreign currency accounts in different international banks. Dar said an amount of $3.725 million was transferred in the Emirates Bank, $8.539 million transferred in the Al Faysal Bank and $2.622 million were transferred in the accounts of the Hudabiya Paper Mills Ltd. He had concluded his statement by adding that the entire amount deposited in these banks finally landed in the account of the Hudabiya Paper Mills.
However, Senator Ishaq Dar neither denied nor confirmed having given the statement. Approached by The News on April 30, 2011 after Rehman Malik had announced taking up the Hudabiya Mills money laundering case against the Sharif brothers, Ishaq Dar stated: “This is all rubbish. The Hudabiya Mills case is nothing but trash. The matter is sub judice in the Lahore High Court and the facts would be known to the general public in due course. All transactions were duly reported to the State Bank of Pakistan as per the law of the land”.
As the NAB sent details of the Hudabiya Paper Mills case to the Election Commission of Pakistan last week, the PML-N said the NAB’s action was based on mala fide intentions. “The NAB should not do politics and it should refrain from becoming a party”, a PML-N spokesman said. On his part, Shahbaz Sharif addressed a press conference in Lahore with Ishaq Dar sitting next to him, refuting that they defaulted on Rs3.48 billion bank loans. “We never abused political positions to obtain loans and then to default on them. It is a conspiracy by a gang of four to malign the most popular leader in the country while misusing the NAB”.
On the other hand, a NAB spokesman has refuted Shahbaz Sharif’s allegations, saying it was in fact the Election Commission which had sought from the Bureau a complete list of the politicians involved in willful default and plea bargain cases. “The NAB records show the Sharif brothers had petitioned the Lahore High Court, seeking the quashing of the loan default cases pending against them in the accountability courts. And since their petition has not yet been decided by the LHC despite concluding the case hearing and reserving the verdict almost four months ago, the status of the Sharifs remains the same — accused in default cases”.

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