D-Day for Sharif family: report due on money laundering
Investigations prompted by revelations in the Panama Papers have been looking at the offshore assets of the Prime Minister's family. The ruling clique has cause to worry
This coming Monday is D-Day for Pakistan’s ruling Muslim League (Nawaz) party. After weeks of deliberation, the Joint Investigation Team (JIT) constituted by the Supreme Court of Pakistan to look into the offshore assets and alleged money laundering of Prime Minister Nawaz Sharif’s family will present its final report to the court.
The investigations stem from revelations about the Sharif family contained in the so-called Panama Papers and have set a judicial precedent in Pakistan. Analysts are intrigued by the developing rift between the government and the judiciary and anticipate the court’s verdict may not be “soothing” for the ruling clique. A campaign of vilification against the JIT and the Supreme Court by the government will also go against the Sharif family, they believe.
To the ire of Sharif loyalists, the JIT has complained to the Supreme Court that the government and state institutions have tampered with the Sharif family’s records and obstructed a smooth investigation. They also claim that the Federal Board of Revenue (FBR) and the Security & Exchange Commission of Pakistan (SECP) did not cooperate with the investigation team and delayed the submission of required documents. The Supreme Court last month directed the FIA (Federal Investigation Agency) to probe tampering of the SECP’s records, as alleged by the JIT, and submit a report.
Anticipating the likelihood of a JIT report that harms Sharif’s grip on power, the Pakistan Stock Exchange (PSX) plunged this week.
Meanwhile, sources told Asia Times that the JIT had been unable to determine a valid “money trail” despite questioning the “key players” – including the prime minister himself, his sons, daughter, son-in-law, and his brother Shahbaz Sharif, who is the chief minister of Punjab. The JIT also grilled half a dozen other prominent personalities, including the country’s finance minister, Ishaq Dar, Tariq Shafi – who is Sharif’s cousin – and the former interior minister Rehman Malik.
In the absence of a clear “money trail” in the Sharifs’ acquisition of properties in London’s Mayfair, the JIT’s focus has shifted to a money laundering case filed by the National Accountability Bureau (NAB) in the year 2000 and quashed by Lahore High Court (LHC) in 2014.
To the certain ire of Sharif loyalists, the JIT will approach the Supreme Court accusing the government and state institutions of tampering with the Sharif family’s records and obstructing a smooth investigation
Procedurally, the NAB could have made an appeal to the Supreme Court, but it didn’t. The pertinent detail of the case is a confessional statement given by Ishaq Dar in which he divulged information about money laundered by the Sharifs in the 1990s. Dar said the Sharifs used Hudaibiya Paper Mills – a company owned by the family – to whiten their “ill-gotten” money. He later reneged on his statement, saying it was recorded under duress.
Rehman Malik – appearing before the investigation committee – presented it with the 200-page Hudaibiya Paper Mills money laundering report he authored in 1998 when he was assistant director general at the FIA. The report claimed that “According to the testimony of two Peshawar-based Hawala (non-banking money channel) dealers, the Sharif family illegally sent funds abroad regularly, to be converted into foreign exchange. Between 1988 and 1991, an amount of Rs56,896 million (US$559 million) was sent out of the country.”
Hawala refers to a type of informal transfer of money that bypasses banks and other financial institutions.
To make matters worse for Sharif, the Qatari Prince Sheikh Hamad Bin Jassim Bin Jaber Al-Thani – whose letter was cited by Sharif’s attorney in the Supreme Court in support of the prime minister’s claims regarding the source of the family’s investments in London real estate – has refused to appear before the JIT, complaining of a lack of “transparency” in the investigation. Later, he agreed to meet JIT members in Doha for a meeting that was scheduled to take place on Thursday (June 7), but his refusal to appear in court for questioning or to produce documents that corroborate Sharif’s claims deals a serious blow to the family’s efforts to provide a valid money trail.