Elusive Panama leaks briefing angers MPs

FBR chief refuses to brief NA panel; heads of NAB, FIA, SBP and SECP skip PAC meeting

ISLAMABAD: Crescendoing calls for an independent inquiry into Panamagate have fallen on deaf ears as the government continues to evade meaningful action on the revelations in the Panama Papers that hundreds of Pakistani politicians, including the ruling Sharif family, and businessmen feature in the offshore archive.

Denmark is learnt to have bought data from the Panama leaks to investigate whether 500 to 600 Danes named there may have evaded tax. Conversely in Pakistan, Federal Board of Revenue (FBR) Chairman Nisar Muhammad Khan and treasury lawmakers on Thursday successfully blocked a fifth attempt by the National Assembly Standing Committee on Finance to get an institutional response to Panamagate.



Not only that, the heads of four state institutions – National Accountability Bureau (NAB), Federal Investigation Agency (FIA), State Bank of Pakistan (SBP) and Securities and Exchange Commission of Pakistan (SECP) – skipped a special session of the Public Accounts Committee (PAC) on the massive tax evasion scandal.



The FBR chairman refused to give a briefing to the parliamentary panel on the pretext that the matter was not on its agenda. The committee has been seeking a briefing from the FBR for the last five months to identify legal lacunae that allowed the illegal capital flight from the country.

Only last week, the FBR issued letters to those who figured in the Panama leaks to seek information, which, legal experts say, was not a serious action. The SECP has identified 444 persons named in the Panama Papers, but has excused itself from taking any action.

Opposition legislators blamed Qaiser Sheikh the PAC chairman who belongs to the PML-N, for not putting the issue on the agenda. Nisar, on the other hand, admitted that he was prepared to give a briefing to the PAC, which met on the same day, but even the parliamentary anti-corruption watchdog could not debate the issue due to the absence of the heads of NAB, FIA, SBP and SECP.



The PAC was forced to issue summons of these officials to bind them to attend the panel’s September 20 meeting.

“This is a disgrace to parliament,” was the unanimous response of the PAC, but some members found the absence of the four top officials conspicuous.



“It is a planned move and the government is behind it,” PML-Q’s Chaudhry Pervaiz Elahi told reporters after the meeting. “Government institutions are not performing their roles due to the involvement of the Sharif family in the Panama scam,” said PTI MNA Dr Arif Alvi, who had requisitioned the special PAC huddle.

When PAC members asked why the SBP governor did not attend the panel meeting, they were told the head of the central bank was busy in connection with Prime Minister Nawaz Sharif’s visit to Karachi.

At this, panel chairman Khursheed Shah of the PPP said the SBP should have informed PAC beforehand and not on the meeting day. He pointed out that his party, when in power, had issued directions stating that the PAC should be given precedence over cabinet meetings.

Though the SECP gave the same excuse as the SBP, the committee got no answers about the absence of others. The NAB chief also informed PAC of his unavailability. “Did the FIA director general also receive a call from the premier,” asked the PAC members.

Finance Minister Ishaq Dar had promised that a legal package to address the Panama Papers issue will be announced by August in consultation with FBR, SBP and SECP. He also could not fulfill this promise.



The dilly-dallying approach has been adopted despite an SECP investigation confirming that 444 persons whose names appeared on the website of International Consortium of Investigative Journalists (ICIJ) are related to Pakistan, according to commission’s letter to the PAC.

The SECP letter stated that these persons are officers and owners of 280 offshore companies mentioned in the Panama Papers. Of these 444 persons, 155 were found to be directors of 600 companies registered in Pakistan, according to the SECP letter.

However, the SECP absolved itself from taking any action against these persons, saying that these companies did not make investments in offshore companies. “The investments as mentioned in the Panama Papers were made by the persons in their individual capacity and same has not been routed through the company’s accounts,” it wrote.

Independent legal experts say SECP’s stance that it cannot take any action against these persons is unlawful. They said Section 101 of the Securities Act of 2015 binds every director to disclose their beneficial ownership and hiding such information would make them liable to punishment.

While the government remains reluctant to move against those who have been named in the Panama Papers, Denmark has become the first country in the world to buy data from the leaks. It now plans to investigate whether 500 to 600 Danes, who feature in the offshore archive, have evaded tax, according to The Guardian newspaper. Denmark’s Tax Minister Karsten Lauritzen, was quoted as saying that he would pay up to 9 million Danish Krones (or £1 million) for the information.

The Panama Papers, published in April, were the biggest leak in history. There are details of offshore companies – half of them incorporated in the British Virgin Islands, a UK tax haven – as well as of secret beneficial owners.

Published in The Express Tribune, September 9^th, 2016.