A man of many lives

ISLAMABAD: In the last three years, Abid Hussain has figured in three high-profile inquiries related to politicians and has so far survived. The Joint Investigation Team (JIT) on Panama Papers found him evasive as he “tried to initially mask the facts”. The JIT on fake accounts case identified his role in the creation of banks used for fraud. In the latest probe, the sugar commission has pointed out his role inprotecting the interests of Jahangir Tareen and sugar barons “highly objectionable that must be investigated conclusively and independently.”

Nawaz Sharif was disqualified, Asif Zardari is about to be indicted whereas Jahangir Tareen’s future also seems uncertain but Abid has not only evaded accountability, he is Executive Director of Corporate Supervision Division (CSD) of Security Exchange Commission of Pakistan (SECP). The CSD is custodian of corporate records including those examined by the sugar commission, Panama Papers JIT and fake account case JIT. In the record submitted to the sugar commission, his role was found to be skeptical. When asked to provide any action taken against six sugar mills named in the inquiry, the reply received by the commission was quite comical.

While Al Arabia Sugar Mills was put on notice for non-maintenance of the company’s website and non-disclosure of beneficial ownership, JDW Sugar Mills of Tareen was served notice only for “non-placement of Urdu language version of company’s website.”

Meanwhile, his questionable investment in Faruki Pulp Mills Limited (FPML) was not held to account. Tareen was co-owner of FPML together with his close relatives and it has remained non-operational since its incorporation in 1991. (FPML had three trial production runs in 1997, 2012 and 2013; none was successful).

When the public limited company---JDW Sugar Mills--- made equity investments of Rs2593.93 million in 2014 and 2016 in FPML despite knowing it is non-operational, it didn’t share this material information with the shareholders which means their money was used without taking them into confidence. As he was alerted in this regard by senior officers in SECP, Abid Hussain (head of CSD) refused to take any action for protection of minority shareholders. Instead, he delayed decision on the file for seven months before refusing to take any action. “The record provided by the SECP reveals that Abid Hussain, Executive Director (CSD) after unusually delaying it for over 7 months, without any further analysis or legal basis closed this case of misstatement and omission of material information by companies (JDW and FPML) related to a Politically Exposed Person,” reads the report of sugar commission.

The report demanded investigation of mills owners and board members other than recommending conclusive investigation against Abid Hussain. “A full-fledged investigation into the affairs of JDW Sugar Mills Limited and FPML to ascertain true and fair view of state of affairs of companies with focus of collection of all relevant evidence including books of accounts, relevant bank records, share transfer transactions, assets sale transaction etc. This scheme of recording impairment loss wrongfully and causing loss to the public appears to have been done intentionally and fraudulently, which entails detailed investigation and legal action against the CEO, Directors, Chief Accountant of JDW Sugar Mills Limited and FPML….The role of this Executive Director (CSD-SECP) named Abid Hussain in this case is highly objectionable that must be investigated conclusively and independently,” according to the report.

No inquiry has been initiated against him as of to-date. When asking, an SECP official in an unofficial reply said that permission in this regard was obtained from SECP board but the matter was stayed by Islamabad High Court. As per rules, SECP doesn’t need board approval for launching inquiry and there is no stay order granted to Abid. Intriguingly, current Chairman SECP happens to be the Commissioner of CSD where Abid is executive director and SECP rules allow him to carry out investigation without taking board’s permission. The official didn’t offer any reply when confronted. He didn’t have an answer when asked as to why JDW Sugar Mills’ concealment of material information from ordinary shareholders while investing in FPML wasn’t investigated.

This is not the first case of PEP where he has been found playing the role of a facilitator in corporate crime instead of performing like a regulator, he is also under NAB’s investigation in the fake account case of Asif Zardari and his business associates. His name has been on Exit Control List and a request in early 2019 for removal from there was opposed by NAB. Abid together with Tahir Mehmood (former Commissioner of SECP) allegedly extended benefit to M/S Suroor Investments Limited (an offshore company registered in Mauritius, and owned by Naseer Ahmed Abdullah Lootah), which illegally acquired majority shareholding in three banks during 2009-11 violating the provisions of Listed Companies (Substantial Acquisition of Voting Shares and Takeovers) Ordinance, 2002. By this way, the acquirer was given benefit of approximately Rs830 million by absolving mandatory requirement of purchasing shares from minority shareholders of the banks.