Friday May 27, 2022

Untold story of NAB unfolded by Broadsheet

Sir Anthony Evans, the judge engaged by Chartered Institute of Arbitrator in London for arbitration, also found the allegation totally unfounded that Nawaz Sharif and Saifur Rehman laundered $500 million after accounts were frozen following the nuclear tests in 1999.

January 08, 2021

ISLAMABAD: Before the arbitration judge handed verdict in favor of Broadsheet LLC in a damage suit, the assets recovery firm laid bare one by one anti-corruption claims of the National Accountability Bureau during the course of cross-examination and through specific instances.

The details it shared persuaded the judge that the information provided in the cases of Aftab Sherpao, Admiral Mansur-ul-Haq and Schon Group was misused for political and personal gains.

Sir Anthony Evans, the judge engaged by Chartered Institute of Arbitrator in London for arbitration, also found the allegation totally unfounded that Nawaz Sharif and Saifur Rehman laundered $500 million after accounts were frozen following the nuclear tests in 1999. The NAB revealed it didn’t investigate Ishaq Dar back then because he assisted against Sharifs.

In 2000, NAB had signed Assets Recovery Agreement with Broadsheet LLC for unearthing the ill-gotten fortune of 200 individuals. Included among them were politicians, generals and businessmen.

The firm was to get 20% of the recovered amount but NAB terminated the contract in 2003 without following the due process that landed it into litigation. By then, Broadsheet was able to track down assets of some targeted individuals---the most prominent among them were Aftab Sherpao, Admiral (R) Mansoor-ul-Haq and his partners, Lt. Gen. (R) Zahid Ali Akbar, Schon Group and others.

In July 2002, Broadsheet informed NAB that it had located assets of Sherpao in an offshore bank of Jersey to the tune of $3.5million and asked NAB to make a formal request to the Jersey authorities for a freezing order; meanwhile a temporary freezing order was imposed.

The NAB issued the letter but without specifying the particular causes of action as the Jersey court required. Broadsheet drafted a new letter instructing NAB to send again but didn’t hear back from NAB.

When reminded again as Broadsheet was due to meet with Jersey’s attorney general, Talat Ghumman, then-DG Finance Crime Investigation, replied that the drafted letter was being examined by FBR and any decision would be taken afterward. There was no further reply. Meanwhile, the contract with Broadsheet was terminated in 2003.

The Jersey authorities nevertheless kept pursuing. In January 2004, its legal department wrote to NAB asking for detailed information. He expressed his “extreme concern at the lack of progress” and said funds would be unfrozen in case of no reply. “There is no evidence of a reply and the funds were later released without any recovery,” noted the arbitration judge. What was going on behind the scene revealed further when Ghumman was cross-examined.

In his witness statement before the judge. “He said he attended a meeting between the Chairman of NAB, General [Munir] Hafiez, and Mr. Sherpao where the letter from Jersey was discussed. Mr. Ghumman said in evidence that Mr. Sherpao ‘didn’t have answers to our queries’ and that he felt that ‘we were very close to obtaining assets’ and that by the time he (Ghumman) left NAB in August 2004 ‘we had not managed to do so.’ When he was asked about this in July 2018 his evidence was confused and unsatisfactory.”

In 2018’s statement, Ghumman insisted NAB couldn’t pursue because he was acquitted by the court and the rule against double jeopardy applied. “However, he could not explain why, in that case, the NAB investigation was continuing as apparently it was when the above meeting took place; nor why it continued, as it did, until as late as 2015,” the judge noted. In August 2004, Sherpao was appointed the interior minister and in November 2006, NAB filed a supplementary reference against him.

In August 2007, he submitted a return to NAB regarding foreign assets, including bank accounts in Jersey, stating that all “have been generated through agriculture income, on which I pay regular income tax” and claiming that funds were routed to Jersey “for portfolio investments via London and Switzerland.” In August 2016, NAB closed investigation against the recommendation of its prosecution division that “investigation is incomplete and defective one.”

In its verdict, the judge also quoted a letter from Jersey’s legal officer who said “Jersey wants to assist Pakistan. It cannot do that without Pakistan’s assistance.” The judge was also surprised at the response of NAB for not pursuing the case. “They also submit that NAB was under no contractual obligation to Broadsheet to pursue that or any other claim, even against registered targets (individuals for whom Broadsheet was hired). The submission surprised me because NAB was established with the statutory duty of recovering corrupt assets,” Sir Anthony Evans noted.

In the case of Admiral (R) Mansur-ul-Haq, two individuals -- Jamil Ansar and Amir Lodhi – were also involved. Jamil was involved in a transaction which led to the recovery of $7.5million from the admiral from his bank account in Jersey. Broadsheet learned through Jersey authorities in January 2002 that Jamil also had a bank account there with $5million parked in it. When informed, NAB stopped Broadsheet from pursuing Jamil’s case on the grounds that he’s not among the targets assigned to the firm.

This was despite the fact that Jamil had confessed in writing before the Jersey authorities he was among the beneficiaries when the admiral received kickbacks. Also, the Jersey’s legal officer when wrote to NAB about Sherpao in 2004 had committed to “cooperate with Pakistan fully” in the repatriation of Jamil’s assets but received no reply from NAB. Ghumman, in his witness statement, said NAB didn’t want to pursue because it didn’t have sufficient evidence that money was corruptly obtained. The story doesn’t end there because in January 2007, Jamil made a ‘voluntary payment’ to NAB of $792,620 (when he had $5million parked in the Jersey bank). “No documents or other explanation of this payment has been produced,” noted the judge.

Amir Lodhi was implicated by Jamil as a party to the arm supply contract under which the admiral received kickbacks. Broadsheet’s investigators first traced him in Monaco and by the end of November 2001, an extradition request was prepared that was acceded to by Monaco authorities. By then, he had left Monaco. Broadsheet located him again in August 2002 in Italy and drafted a Request for Legal Assistance letter which was sent to NAB. Whether it was issued to Italy or not remains unconfirmed.

Family members of Schon Group were also among registered targets in connection with the loan exceeding Rs2billion they got from Pakistani banks, invested abroad and declared default. The family agreed to pay Rs1.2 billion partially in exchange of the criminal charges being dropped against them. By the time the agreement was reached, Talat Ghumman had left NAB but he was present on the signing occasion. In What capacity? He was a private consultant and advisor to Schon Group which he had been pursuing against. “When he was cross examined, he (Ghumman) said that he was present at the signing of the October 2005 agreement in his new post-NAB capacity as a private consultant and adviser to the Hussain family. It was not suggested to him that this involved any conflict of interest on his part and I need say no more about it,” the judge wrote.

One point of contention between the two parties was inclusion of Ishaq Dar’s name in the list of targets that Broadsheet was to pursue. Intriguingly, he was in the Broadsheet list but NAB said it never forwarded his name.

In his witness statement, Ghumman said that NAB never agreed that Dar could be a registered target and “my recollection is that there were no investigations into Mr. Dar during my time at NAB [until August 2004].” Then he explained why.

“There was a reason why NAB never agreed to its inclusion because Mr. Dar gave some assistance to NAB regarding Sharif family assets,” Ghumman told the judge.

Claim of $500million money laundering also formed part of the proceeding. After nuclear tests in 1999, foreign currency accounts held by Pakistani banks were frozen through a presidential order. A formal complaint was lodged with the Chief Ehtesab (NAB’s predecessor) Commissioner in Islamabad against the Prime Minister, Nawaz Sharif, Senator Saif-ur-Rehman and two others, alleging first, that they acted together with others, including Mujeebur-Rehman, Senator Rehman’s brother, to withdraw US$500 million from various Pakistani bank accounts, and second, that a named person connected with Nawaz Sharif had been stopped when boarding a flight 56 at Lahore airport carrying bags of foreign currency, but then was permitted to continue on the flight following an intervention by the prime minister.

Making reference to a file provided by NAB, the judge said an early document (November 6, 1999) suggested “transmitting Rs500 million abroad” but all subsequent references are to $500million. But there is no satisfactory evidence that a quantity of cash amounting to $500million, the judge noted, ever existed.

“It is not possible to carry US$500 million in a bad and dispose of the same in UAE. Case is recommended for a closure,” the judge quoted from a NAB file dated September 29, 2002. Nevertheless, the file reveals, various enquiries were made, for example, with the State Bank of Pakistan, and that no support was found for either allegations.

“On more than one occasion it was recommended that the file be closed. But it was only on 18 March 2005 that the case was formally closed,” he pointed out.

A NAB official said that the current leadership of the Bureau has distanced it from the Broadsheet case, saying that that the law firm hired to defend the case was done on directives of the former prime minister, Attorney General Office and the Ministry of Law.