EOBI scam: FIA raids AKD office, detains 3 directors

Federal agents say top executives caused multibillion-rupee loss to EOBI

KARACHI: The sleuths of Federal Investigation Agency (FIA) on Monday raided the offices of the Aqeel Karim Dhedhi Group (AKD Group) and took into custody three directors on charges of multibillion rupees scam in sale of shares to Employees Old Age Benefit Institution (EOBI).

Top officials of the AKD Group, EOBI and a textile mill are accused of stock market manipulation to earn illegal gains and deliberately causing losses to the state-run pension fund.

The FIA has detained AKD Securities' CEO Farid Alam, Director and Head of Equities Tariq Adam Ghumra and Director Muhammad Iqbal, in a move that has sent shock waves in the financial industry.

“All three of them are accused of causing billions of rupees worth of losses to the national exchequer,” said FIA Deputy Director Kamran Ataullah.

"The accused created hype in the stock market to fraudulently push up the share price of the Faisalabad-based textile company Amtex far beyond its actual value before selling its shares to the Employees Old Age Benefit Institution (EOBI)," Ataullah said.

The trades by EOBI were made in 2010 at the time of initial public offering of Amtex. About the fact that it took so long for the authorities to take action, a senior FIA official said the whole cycle of events took place between 2009 and 2010 after which an inquiry was initiated against the accused.

However, the federal agent said that the probe hit snags due to various compulsions. "And now the investigation is in process and the accused have been arrested," he said.

An FIA report, a copy of which is available with The Express Tribune, says that the accused include former EOBI Chairman Zafar Iqbal, DG Investment Kanwar Khursheed Wahid and other EOBI officials. Other people involved in the case include CEO and directors of Amtex Limited including Khurram Iftikhar, Shahzad Iftikhar, Nadeem Iftikhar, Zafar Saleem, and others.

CEO and directors of Amcap Securities Abdul Rauf Ghani, Haji Iftikharuddin, the CEO and directors of AKD Securities Limited Muhammad Farid Alam, Tariq Adam Ghumra and Muhammad Iqbal and others are also under investigation.

Dhedhi speaks

Later in the day, the stock market baron, Aqeel Karim Dhedhi, Chairman of the AKD Group, held a press conference at Karachi Press Club where he expressed his reservations over the raids and the arrest of his senior officials.

It is unjustified to arrest a person on the basis of any report, said Dhedhi. “There are at least 40 names in the research report but nobody even touched them,” he said.

The AKD Group boss said that he would exercise his right to approach the court.