NationalVOLUME 17 ISSUE # 5

Unopened Pandora’s box

The Pandora Papers have revealed over 700 Pakistanis, who own offshore companies. Besides former generals, bureaucrats, businessmen and politicians, a few ministers in Prime Minister Imran Khan’s cabinet have also been named in the leaks. However, the new leaks fail to shake the country. If Pakistanis past experience of the Panama Papers is any guide, all accused are most likely to get off scot-free. Prime Minister Imran Khan has announced a probe into the scam but he should have asked his tainted ministers to step down or sacked them to save his reputation and meet his own demand he had made after the onset of the Panama leaks in Prime Minister Nawaz Sharif’s government in 2016.

The Panama Papers had also revealed most expensive London flats of the Sharif family and former Prime Minister Nawaz Sharif was disqualified by the Supreme Court of Pakistan after a Joint Investigation Team (JIT) was formed to probe the issue. He himself had taken the issue to the court. His biggest “mistake” was that his sons had admitted to owning properties in London, while 479 Pakistanis named in two parts of the Panama leaks and 135 others in the Paradise leaks called the reports of the International Consortium of Investigative Journalists (ICIJ) “misleading” and denied owning an offshore company. The result was that they all escaped action and only Nawaz Sharif and his family faced media humiliation and accountability. The same situation has arisen now. Almost all accused in the new leaks have distanced themselves from their offshore companies and it will be impossible for state institutions to prove their wealth abroad and subsequently take action against them in the absence of international cooperation, as happened in the Panama Papers.

Prime Minister Imran Khan has set up a cell to investigate the Pakistanis named in the Pandora Papers. The cell, formed under the Prime Minister’s Inspection Commission, will consist of people from the National Accountability Bureau (NAB), Federal Investigation Agency (FIA) and Federal Board of Revenue (FBR). According to the government, the cell will determine whether the public office holders had declared their foreign assets. If not, a corruption case will be referred to the National Accountability Bureau. In case of money laundering, the case will go to the Federal Investigation Agency and for non-public office holders, a tax evasion case would be forwarded to the Federal Board of Revenue.

Opposition leader Imran Khan had demanded Prime Minister Nawaz Sharif resign when the ICIJ had named the latter and his three children in the Panama Papers. Now national and international observers want Prime Minister Imran Khan to act on his own demand and sideline the ministers and politicians of his party until they come clean after investigations. According to the ICIJ, key members of Imran Khan’s inner circle, including cabinet ministers, their families and major financial backers have secretly owned an array of companies and trusts holding millions of dollars of hidden wealth. They include; finance minister, Shaukat Fayaz Ahmed Tarin, and his family, and the son of Imran Khan’s former adviser for finance and revenue, Waqar Masood Khan. The records also reveal the offshore dealings of a top PTI donor, Arif Naqvi, who is facing fraud charges in the United States. The ICIJ claimed Chaudhry Moonis Elahi planned to put the proceeds from an allegedly corrupt business deal into a secret trust, concealing them from Pakistan’s tax authorities. Omer Bakhtyar, the brother of minister for industries, Makhdum Khusro Bakhtyar, transferred a $1 million apartment in the Chelsea area of London to his elderly mother through an offshore company in 2018, according to the leaks. Former minister for water resources, Faisal Vawda, set up an offshore company in 2012 to invest in UK properties. He resigned in March amid a controversy over his status as a dual US-Pakistan national. Vawda told the ICIJ that he had declared all worldwide assets held in his name to Pakistani tax authorities. Tariq Shafi, a leading businessman and another PTI donor, held $215 million through offshore companies, the records show.

According to the ICIJ, Moonis Elahi attempted to hide proceeds from an alleged misuse of public funds with the help of an elite offshore service provider. “In January 2016, Moonis Elahi, then a member of Punjab’s provincial legislature, met with officials at Asiaciti Trust, a financial services provider that specializes in offshore wealth management. Records show that he told Asiaciti staff that he wanted to invest money from the 2007 sale of land owned by Phalia Sugar Mills, a family business. The records show that Asiaciti officials asked him about his past legal problems. He provided them with a court document clearing him of fraud charges unrelated to the Bank of Punjab scandal. After the meeting, documents show, Asiaciti designated him as a “politically exposed person” or PEP — a legal term denoting a corruption risk related to a client’s status as a public official.

It is clear that Pakistanis, who own offshore companies and wealth have learnt a lesson from the Panama Papers – do not plead guilty. Almost all of them have denied owning offshore assets. It puts the onus on investigation agencies to prove the existence of their foreign companies. Everybody knows the leaks are based on facts, as not a single accused from Pakistan or anywhere in the world has challenged their veracity in any court. The accused named in the Panama leaks, including the Sharifs, could have earned billions of dollars in damages if they had been wrongly identified. They avoided moving courts because they knew they would lose cases.

There is nothing new in the Pandora leaks for Pakistanis except a few retired army officers and almost all top media owners. Only five retired military officers and their families have been linked to offshore companies. Their number is negligible as compared to over 700 politicians and businesspeople named in successive leaks. However, it is a pity that only politicians are being savaged in the mainstream media and not a single talk show has been held on media owners who own offshore companies. It is a glaring example of the use of the media for personal likes and dislikes.