Saturday December 02, 2023

UK govt fines MQM founder over £2m for tax evasion

September 03, 2020

LONDON: The British government has fined Muttahida Qaumi Movement (MQM) leader Altaf Hussain £2 million over income tax evasion and an investigation is already underway to determine the full extent of the MQM leader’s financial matters.

Documents seen by this reporter show that Altaf Hussain has been fined for not paying over £2 million to the national exchequer over a period of 20 years for evading taxes over large earnings running into millions of pounds.

The tax investigation is based on income, payments, assets accumulation and National Insurance contributions, which were never paid since 1995-2015. The investigation is based on the estimated income and monthly expenditure of the MQM leader and his workers.

At his home in Edgware, Altaf Hussain is protected round the clock by three full time bouncers; two maids; a full time driver and a cook. His house expenditure alone and settlement payment to his former wife Fiza Gabol and daughter Afzaa is estimated to be around £50,000 per month. This amount doesn’t include the payments made to Altaf Hussain’s party staff who man the London office full time and have been doing so for over 20 years.

Dozens of people have worked in full time and part time capacity from the MQM’s International Secretariat. At its peak, nearly 20 people were on the payroll of the MQM and it’s understood that the recipients were getting cash in hand as many of the recipients also received government benefits for living and income.

According to a source close to Altaf Hussain, the MQM founder has contested the civil proceedings stating that he never earned any money and has never been employed and was not obliged to pay income tax to HMRC. He has told the investigators that he has been managing his life through donations given by loyalists from Pakistan and abroad and as head of a political party, he was entrusted to use those funds to maintain his lifestyle – free of taxes.

Although the MQM leader has contested the fine through his lawyers and the investigation is of a criminal nature but the investigation is so wide-ranging that it has badly impacted the financial situation of the MQM leader. Sources within the MQM have confirmed that the HMRC’s investigation is amongst the main reasons behind Muhammad Anwar and Tariq Mir’s decision to part ways with Hussain.

Both Tariq Mir and Muhammad Anwar dealt with taxation and financial issues for the party for over two years – until their relation broke up around four years ago. Anwar and Tariq Mir are qualified accountants and were responsible for the financial and tax matters of the party and founder Altaf Hussain.

Both Anwar and Tariq provided a base to the MQM founder in 1994 at their accountancy firm in Mill Hill when Altaf left Karachi for London. Before his colleagues and inner party circles, Altaf Hussain has accused Tariq Mir and Anwar of not guiding him properly and of failing to pay dues to the government while they were the ones responsible for all the financial matters, that is why Altaf Hussain asked his followers to protest outside Tariq Mir’s residential address in 2019.

Both Anwar and Mir have been named in the HMRC investigation and Altaf Hussain’s lawyers have told HMRC that the blame for not paying the arrears and dues should rest with them as he personally didn’t handle the financial matters.

The HMRC has not blamed Mir and Anwar of any wrongdoing. Papers seen by this reporter show that in their submission, Mir and Anwar have told the investigators that Altaf Hussain didn’t listen to their advice on managing monies, and was the sole person to decide where the funds were to be allocated.

Altaf Hussain, Mir and Anwar have been at odds over the transfer of two properties worth nearly £1.5 million to the MQM founder’s name. Anwar and Mir are titleholders – and legal owners of 221 Whitchurch Lane and 185 Whitchurch lane properties, however, MQM is the beneficial owner of the properties. Although currently the two properties are occupied by the people close to Altaf Hussain but legally Anwar and Mir are owners of the properties.

When Altaf Hussain pressed them to transfer the properties, Mir and Anwar told him privately first and then through lawyers they that they awaited the final resolution of the HMRC case. In a legal letter sent to Altaf Hussain, Anwar and Mir had written that “the ongoing HMRC inquiry” was their concern and that they expected Hussain to discharge all dues, arrears or penalties payable to HMRC.

Both of them have further said that they will not be transferring the two properties to Altaf Hussain under any circumstances. They have said that one property will be transferred to Dr Imran Farooq’s widow Shumaila Imran Farooq and the other for the relatives of MQM-Pakistan’s martyrs. The HMRC is currently of the view that paying taxes was responsibility of Altaf Hussain not any other individual or anyone else associated with him.