Monday May 27, 2024

Affluent Pakistanis who appear on Pandora Papers

The leaked documents reveal that several members of PM Imran Khan’s cabinet have holdings hidden offshore in several jurisdictions

By Fakhar Durrani
October 04, 2021
Senior PTI leader Aleem Khan, Finance Minister Shaukat Tarin and PML-Q leader Moonis Elahi
Senior PTI leader Aleem Khan, Finance Minister Shaukat Tarin and PML-Q leader Moonis Elahi

ISLAMABAD: Key members of Imran Khan’s cabinet, retired civilian and military officials and their families as well as owners of some of the country’s top media outlets, secretly own or have owned an array of companies and trusts holding millions of dollars in offshore jurisdictions.

The revelations are part of the Pandora Papers, a new global investigation carried out by the International Consortium of Investigative Journalists (ICIJ) with the collaboration of 600 journalists around the world. The investigation lifts the lid off the shadowy offshore financial system that allows multinational corporations, the rich, famous and powerful to avoid taxes and otherwise shield their wealth. The probe is based on more than 11.9 million confidential files from 14 offshore services firms leaked to the ICIJ.

The leaked documents reveal that several members of Prime Minister Imran Khan’s cabinet, or close members of their families, have holdings hidden offshore in several jurisdictions. Those whose offshore holdings have been exposed in the Pandora Papers include Finance Minister Shaukat Tarin and three of his family members, Minister for Industries and Production Makhdoom Khusro Bakhtiar’s younger brother Omer Shehryar, former federal minister Faisal Vawda and two other family members, Federal Minister for Water Resources Moonis Elahi, Senior Provincial Minister for Food Abdul Aleem Khan, former Special Assistant to Prime Minister on Finance and Revenue Waqar Masood Khan’s son, President National Bank of Pakistan Arif Usmani and Managing Director National Investment Trust Adnan Afridi.

In addition to the civilian leadership, the Pandora Papers have also revealed some top retired military leaders who had kept their holdings offshore. The retired military officials who owned offshore companies or properties include a former corps commander’s wife and son, Lt Gen (retd) Muhammad Afzal Muzaffar’s son, Major General (retd) Nusrat Naeem, Lt Gen (retd) Khalid Maqbool’s son-in-law, Lt-Gen (retd) Tanvir Tahir’s wife, Lt-Gen (retd) Ali Kuli Khan’s sister, Air Chief Marshal Abbas Khattak’s sons and retired army officer and politician Raja Nadir Pervez.

Apart from civilian and military leaders, the leaked documents have also revealed the names of Pakistani media moguls who owned offshore companies. The media owners who held offshore companies include publisher of Jang group Mir Shakil-ur-Rahman, CEO Dawn media group Hamid Haroon, Publisher of Express Media Group Sultan Ahmed Lakhani, the Gourmet Group which also owns a TV channel GNN and publisher of Pakistan Today the late late Arif Nizami.

Moreover, former finance minister Ishaq Dar’s son, Ali Dar, Sindh’s former information minister Sharjeel Inam Memon and former chairman FBR and Secretary Finance Salman Siddiq’s son Yawar Salman owned companies in the tax havens.

The Pandora Papers have revealed how the civilian and military elites have kept their holdings hidden and used offshore companies to buy luxurious properties abroad. A majority of those named in the Pandora Papers have either distanced themselves from these companies, citing the reason that their family members are working independently, or termed the companies ‘dormant’. Although, there are legal uses of offshore companies, tax havens are of significant public interest because of the frequent use of such jurisdictions to engage in money laundering, tax evasion and other illicit activities. It is however not confirmed how many of the above-mentioned names have declared these offshore holdings to the tax authorities in Pakistan.

Khan’s ministers and their families

Before coming to power, Prime Minister Imran Khan ran a vigorous campaign against the corrupt practices of the country’s political elite. He promised that accountability would start from him and go down to his ministers. In 2016, when the ICIJ released the Panama Papers implicating former prime minister Nawaz Sharif and his family, Khan termed it a “God sent gift”. The revelations made in the Pandora Papers, that contain the names of some prominent and key figures in Khan’s cabinet, will be a test case for Prime Minister Imran Khan to make his close associates answerable for holding offshore companies.

The financial wizard of Imran Khan’s government — Shaukat Tarin was recently inducted into Khan’s cabinet and appointed Finance and Revenue Minister after the resignation of Abdul Hafeez Sheikh. Tareen and three of his family members have four offshore companies registered in the British Virgin Islands (BVI) jurisdiction. The Tareen family incorporated four offshore companies —Triperna Inc, Hamraa Inc, Seafex Inc and Moonen Inc — all of them in 2014.

In his response to the queries, Tarin confirmed being part of the above companies directly or through his family members for the sole purpose of raising capital for his bank. He said the offshore companies mentioned were incorporated as part of the fund-raising process for his bank. “We were in negotiations with a Middle East conglomerate for raising capital for my bank, through a structured transaction. The proposed investor had also taken the Central Bank’s in principle approval for the investment.” He added that the companies remained dysfunctional and no business was carried out through them. About Tariq Fawad Malik, he said Malik was associated to that Middle Eastern company at the that time and hence he was facilitating the said transaction.

The Pandora Papers reveal that Broadsheet-famed Tariq Fawad Malik was the recordkeeper of the Tarin family’s four companies. The ICIJ approached Tariq Fawad Malik, who in response stated that the companies were set up as a part of the Tarin family’s intended investment in a bank with a Saudi business family. He said the deal could not materialize and the companies were now dormant.

The leaked documents show that Prime Minister Imran Khan’s close aide and former minister for water resources, Faisal Vawda, his wife and sister have an offshore company. The Vawda family incorporated Dazzling Worldwide Ltd in the BVI jurisdiction in 2012 to invest in UK properties, the Pandora Papers show.

Earlier, the local media had reported that Vawda owned multiple luxurious properties in upmarket areas of London. In 2018, he declared only three UK properties and the flats he owned in Dubai and Malaysia under the whitening of black money scheme (tax amnesty scheme, 2018) introduced by the PML-N government. He resigned in March this year from membership of the National Assembly and as a federal minister, amid a controversy over his status as a dual US-Pakistan national. Vawda told the ICIJ that he has declared all the worldwide assets held in his name to the Pakistani tax authorities.

Another close aide of Prime Minister Imran Khan, Abdul Aleem Khan also owns an offshore company. The Pandora Papers show that the registered directors of Hexam Investment Overseas Limited (BVI) — Aleem Khan and his wife — approved a written resolution of the offshore company on March 1, 2017 and confirmed being directors of Hexam Investment. In 2016, the Panama Papers had also reported the same company belonging to a senior PTI leader. NAB had also initiated an investigation against Aleem Khan. It is, however, not confirmed whether he has declared the company in his tax returns or not.

Makhdoom Omer Shehryar, the younger brother of Minister for Industries and Production Makhdoom Khusro Bakhtiar owns two offshore companies, ETEL and Rotenon Universal Inc, in the BVI jurisdiction. The Pandora Papers reveal that Makhdoom Omer transferred a $1 million apartment in the Chelsea area of London to his elderly mother through an offshore company in 2018. The Makhdoom family has been facing allegations regarding the exponential growth in their assets. The National Accountability Bureau was also investigating these allegations. Makhdoom Khusro Bukhtiar in his response to the ICIJ said that the anti-corruption agency’s investigation was founded on baseless allegations, which had underestimated his family’s past wealth, and that it has so far not resulted in a formal complaint. He said his brother is an independent person and has pursued his own professional career from the start. He refuted the assertion that he is his brother’s business partner.

Moreover, the leaked documents reveal that Federal Minister for Water Resources Moonis Elahi was the Settlor and Investment Director of the Green Hills Trust and Winthrop Fund. As per the documents, Chaudhry Moonis Elahi met with officials at Asiaciti Trust, a financial services provider that specializes in offshore wealth management. As per the documents, Moonis told Asiaciti staff that he wanted to invest money from the 2007 sale of land owned by Phalia Sugar Mills, an Elahi family business.

The records show that Asiaciti officials in a meeting with Elahi asked about his past legal problems. He provided them with a court document clearing him of fraud charges unrelated to the Bank of Punjab scandal. The documents further reveal that after the meeting, Asiaciti designated Moonis Elahi as a ‘politically exposed person’ (PEP) and commissioned Thomson Reuters Risk Management Solutions for an enhanced due diligence check.

Thomson Reuters carried out due diligence of Moonis Elahi and produced a 19-page report with the details of his alleged involvement in corrupt land projects. The report mentioned fraudulent loans from the bank and selling the land to a government department. However, despite this due diligence report, Moonis was accepted as Asiaciti’s client.

The family spokesperson of Chaudhrys said that in the past due to political victimization misleading interpretations and data have been circulated in files for nefarious reasons against the family in the name of so-called accountability. The spokesperson added that the assets of the family, including Chaudry Pervaiz Elahi and Chaudry Moonis Elahi, are declared as per applicable law.

Former secretary Finance and Special Assistant to Prime Minister on Finance and Revenue Waqar Masood’s son Abdullah Masood Khan also co-owned an offshore company Linkquest Ltd in the BVI jurisdiction. Abdullah Masood Khan became a director of the company in January 2014 and owned 50 percent shares of the company along with one Mrs Neelofar Ali. Dr Waqar Masood Khan has recently resigned as an SAPM. Dr Waqar in his reply to the ICIJ said that he did not know what his son’s company did. He said his son lived a modest life, and was not dependent on him financially.

Another key appointee of the Prime Minister, Khan Arif Usmani, President National Bank of Pakistan, incorporated a company Sasa Partners Inc. in the BVI offshore tax havens in March 2018. The Pandora Papers reveal that Usmani is the beneficial owner of the company where he kept bankable assets.

Usmani was asked by The News whether it is a fact that the FBR is investigating into the non-declaration of offshore assets worth $11,481,440 kept in Citi Trust, Jersey. Are they different from those held through Sasa Partners? He was also asked if it is true that he has not provided evidence in support of his statement submitted to the FBR regarding investment in Citi Trust’s offshore bank account. Is it a fact that he didn’t declare these while filing tax returns for 2008 to 2012 when he was a tax resident in Pakistan? Usmani, while responding to The News’ queries, said all his tax records have been provided to the FBR and every asset he owns internationally or locally has been declared in his wealth statements filed with the FBR.

The leaked documents show that Managing Director of National Investment Trust Adnan Afridi registered an offshore company Veritas Advisory Services Ltd in the British Virgin Island in October 2011. In his reply to The News, Afridi confirmed having an offshore company Veritas. However, he said Veritas was struck off the Register of Companies in the BVI in December 2017, two years prior to his appointment as Chairman NIT, as it was a dormant company.

More PEPs from other parties and civil bureaucracy

In addition to members of Khan’s cabinet and their families, there are a few names from the opposition parties who kept their holdings offshore. One such example is Ali Dar — former finance minister Ishaq Dar’s son. The Pandora Papers reveal that Ali Dar owns two companies — Baraq Holdings Ltd and Dar Al Nahyan Ltd — registered in the British Virgin Islands. In 2017, he requested for a change of correspondence address. Was this linked to the NAB investigations in which his father was also implicated? Dar in his reply to The News said Dar Al Nahyan Limited remained dormant and no business has been done in the company which has now been struck off the register. He said he has never been a tax resident in Pakistan and nor has he ever been involved in any professional employment or business activities whatsoever in Pakistan.

The Pandora Papers have revealed that former information minister in the Sindh government Sharjeel Inam Memon also owned three offshore companies in the BVI jurisdiction. The three companies that are owned by the Memon family include Ocean Wave Technologies Corp, Arctic Development Corp., and New Coast Executive Inc. The companies are involved in the real estate business. The former provincial minister while talking to The News neither denied nor confirmed about the companies’ ownership.

The leaked documents show that just a few months prior to the retirement of senior bureaucrat Salman Siddique, his son Yawar Salman along with another partner Noeen Ahmed Anwar registered an offshore company Cres Tech Holdings Limited in the BVI. Both Yawar and Noeen are the ultimate beneficial owners of the company. The email addresses of both the beneficial owners mentioned in the company’s documents are of Votel. According to the Votel website, the company provides services for security and surveillance solutions. However, it is not clear what their relationship with this company is.

Yawar Salman told the News that the entity Cres Tech Holdings was incorporated as part of a then-envisaged plan to undertake a foreign business. However, owing to certain circumstances, neither any equity was contributed nor any bank account opened. Since no equity was ever contributed and the entity’s worth remains ‘nil’, the question of disclosing it to the tax authorities does not arise.

The Pandora Papers have also revealed that the owner of the Pakistan Super League (PSL) franchise, Peshawar Zalmi, and renowned industrialist Javed Afridi owns three offshore companies in the BVI jurisdiction. Afridi is the beneficial owner of Old Trafford Properties Ltd, Sutton Gas Works Properties Ltd and Gas Works Property Ltd.

Javed Afridi in his response confirmed to The News ownership of three offshore companies. He said the reason to incorporate them was for the good intention to save tax rather than avoiding any tax. According to him, the companies were almost dormant, and no business or investment was done by any of the companies.

Media owners

The Pandora Papers have brought forth some media owners’ names who have offshore companies in offshore jurisdictions. Some of the leading media groups’ owners have registered companies in the tax havens.

The leaked documents revealed that Jang Group’s Publisher Mir Shakil-ur-Rahman owns an offshore company Brookwood Ventures Limited in the BVI jurisdiction. Mir Shakil-ur-Rahman was transferred the shares of the company on April 17, 2008. Fareeduddin Siddiqi was appointed director of the company in April 2008. When contacted initially, Mir Shakil-ur-Rehman was reluctant to respond, saying that his company is already declared, so there is no point in responding to the questionnaire. However, he was pressed by the investigation cell to respond or questions would be raised on the transparency of this investigation. He then agreed to reply to the queries.

The investigation cell sent a questionnaire to Mir Shakil-ur-Rahman to know if it was true that he owns an offshore company to which he replied, “No, it’s not true, I don’t own any company. However, I had this till 2018.” The News also asked him that the British Virgin Islands is a tax and secrecy haven. Why he opted to set up a company there. MSR replied that people invest in BVI as it offers attractive conditions for investment. MSR was also asked if he declared the company with the relevant tax authorities to which he said, “Yes, it was part of my wealth for the tax year 2018 and subject to taxes where applicable.”

Furthermore, Hameed Haroon — CEO of Dawn media group — owns an offshore company Bardney Limited, registered in the Seychelles. In his official response to The News, Haroon said the company is duly declared and is being reported to the relevant authorities in Pakistan in accordance with the applicable laws of the land.

The Pandora Papers show that the late Arif Nizami — one of Pakistan’s leading journalists and owner of an English daily newspaper Pakistan Today — owned New Mile Production Limited in the British Virgin Islands. The company was incorporated in July 2000. The Pandora Papers documents reveal that the late Nizami and his wife Naveen Arif Nizami were declared beneficial owners of the company. Both Mr and Mrs. Nizami through this company held investment portfolios with Standard Chartered Bank Singapore, which included cash accounts, bonds, equities and mutual funds. The documents reveal that the estimated value of these assets at that time was US$1.6 million. It is, however, not clear whether the company is declared with the tax authorities in Pakistan or not.

The new leaks reveal that an employee of Gourmet group named Amna Butt was appointed director of an offshore company, Gourmet Holdings Limited in the BVI jurisdiction. The Gourmet group owns a large chain of bakeries across the Punjab. In addition, the group owns a news channel as well. It is, however, not confirmed whether the company is declared with the Pakistani tax authorities or not. Ms Amna Butt was sent a questionnaire by The News, but no response has been received from her.

The owner of another well-known media outlet Express Media Group Sultan Ali Lakhani also owns an offshore company Century Media Network Inc. The company was incorporated in February 2005. Lakhani, along with another individual Muhammad Anwer Abdullah, owned shares of this offshore company. Spokesperson of the Lakhani family said all companies are legal and as per law of the land wherever applicable.

Former military officials

In addition to the politicians, media owners and civilian bureaucrats, some top retired military officials have also been named in the new leaks of the ICIJ.

The Pandora Papers reveal that in 2007, the wife of former corps commander owned a BVI company Talah Limited. The offshore company owned a property in London which was transferred to wife’s name in 2007. Talha Limited was originally owned by Akbar Asif — son of the famous Indian film director K Asif (the maker of Mughal-e-Azam).

The former corps commander told the ICIJ that the purchase of the London apartment had been made through a former army colleague, then acting as a consultant to London real estate firms, and not through any personal connection to Asif.

He said the flat was transferred to his wife’s name because he already had properties in his name while she did not have any “in order to balance tax deductions.”

The leaked documents show that Major General (retd) Nusrat Naeem owned a BVI company, Afghan Oil & Gas Ltd that was registered in 2009, shortly after his retirement. In his response to the ICIJ, Major General (retd) Nusrat said that the company had been set up by a friend and that he did not use it for any financial transactions.

The ICIJ leaks reveal that Ahsan Latif — son-in-law of former Governor Punjab Lt General (retd) Khalid Maqbool owned an offshore company, Dylan Capital Limited — registered in the British Virgin Islands. As per the documents, the company was incorporated for investment holding for certain properties in the UK and the UAE, but it was used for importing LPG from Russia’s Vacus Oil Company Ltd.

An excerpt from an email of Ahsan Latif to Trident Trust shows, “The purpose of the company is primarily the same. Actually, the whole transaction is that our company Synergy Resources (Pvt) Ltd, which is based in Lahore, Pakistan, intends to import LPG (Liquefied Petroleum Gas) from Russia. In order to maintain the competitiveness in the market, we don’t want to reveal the name of the supplier in the Pakistani market. As an additional information, we are also striving to get the exclusive marketing rights for the supplier’s products for this region. For this purpose, Synergy Resources (Pvt) Ltd intends to open the L/C in favour of Dylan and Dylan shall then open a back to back L/C in favour of the supplier. The difference between the L/C value of Synergy Resources (Pvt) Ltd. and Dylan shall be retained by Dylan as profits which may then be used as investments as described in your email.”

It is, however, not clear whether Ahsan Latif has declared the above-mentioned assets before the tax authorities in Pakistan. The News sent a query to him but received no response from him.

Moreover, the Pandora Papers reveal that Muhammad Hasan Muzaffar, the son of Lt General (retd) Muhammad Afzal Muzaffar, owned shares in a company registered in the British Virgin Islands, Creek Growth Capital Holding Ltd. The offshore company owned Southeast Healthcare Holding, which in turn controlled a Dubai-based medical center that now appears to be closed. Hasan told ICIJ that the simple fact is there is no relation of this investment to his father. He further commented that the investment was made solely from his own income earned in the UAE and came from his UAE bank account. No other family member, including his father, was involved.

Lt Gen (retd) Tanvir Tahir’s wife Zahra Tanvir owned an offshore company Ener Plastics Limited in the BVI jurisdiction. The Pandora Papers show that Mrs Zahra Tanvir is one of the beneficial owners of the company. As per the leaked documents, the Ener Plastics Limited is a holding company and dividends and real investment is the main source of funds for the company. The News sent a questionnaire to Zahra Tanvir but received no response from her.

The Pandora Papers show that Shahnaz Sajjad Khattak inherited a fortune from her father, Lieutenant General (retd.) Habibullah Khan Khattak, through an offshore trust that owns two London apartments, purchased in 1997 and 2011 in Knightsbridge, London, a short walk from Harrods. She, in turn, set up a trust for her daughters in 2003 in Guernsey, a tax haven in the English Channel. Miss Khattak is also the sister of Lt. Gen (retd) Ali Kuli Khan and sister-in-law of former federal minister Gohar Ayub Khan. She did not respond to ICIJ’s requests for comment.

The Pandora Papers also reveal that Raja Nadir Pervez, a retired army lieutenant colonel and former minister in the Nawaz Sharif-led government, owned International Finance & Equipment Ltd, a BVI-registered company. In the leaked files, the firm is involved in machinery and related businesses in India, Thailand, Russia and China. Records show that in 2003, Raja Nadir Pervez transferred his shares in the company to a trust that controls several offshore companies.

While he owned International Finance & Equipment, Pervez also held several high-level positions in the government. He was elected to the National Assembly in 1985 and subsequently joined the PML-N. He is currently a member of Imran Khan’s PTI. Raja Nadir Pervez did not respond to ICIJ reporters’ questions.

Umar and Ahad Khattak, sons of the former head of Pakistan Air Force, Air Chief Marshal Abbas Khattak, in 2010 registered a BVI company to invest what documents call “family business earnings” in stocks, bonds, mutual funds and real estate. The ICIJ sent a questionnaire to the Khattaks but they did not respond to the queries.