Pakistan Steel Mills: Court calls for quick investigation
Supreme Court chief justice seeks forensic audit report within a month.
ISLAMABAD:
The Supreme Court of Pakistan on Wednesday directed the Federal Investigation Agency (FIA) to expedite investigation into the corruption at Pakistan Steel Mills (PSM), a government-run industrial unit.
Chief Justice Iftikhar Muhammad Chaudhry, presiding over the case, asked the PSM management to submit a forensic audit report of its accounts within a month, disregarding a plea entered by the Pakistan steel mill’s counsel Fakhruddin Ibrahim that the auditor preparing the report would not be able to complete it in less than three months.
Management officials at the state-owned enterprise are alleged to have sold steel at prices below PSM’s operational costs to as many as 469 steel dealers. Among alleged beneficiaries was the Pakistan National Shipping Corporation (PNSC), another state-owned enterprise that is also publicly listed on the Karachi Stock Exchange.
PSM reported a net loss of Rs26.5 billion in 2009, another loss of Rs11 billion in 2010 and has thus far accumulated a net loss of Rs5.7 billion in the first six months of the financial year ending June 30, 2011. The company has had to be bailed out by the federal government in 2010 through a Rs25 billion injection of capital into the firm.
The court ordered PSM to focus on minimising losses and recover money from people who had allegedly defrauded it. The court did not specify the mechanism for recovery of money. A case is yet pending against steel dealers accused of being involved in defrauding the PSM.
The lawyer for the steel dealers association said that his clients were cooperating with the investigation and the recovery process.
When PSM maintained that the association had returned just Rs25 million in compensation, the chief justice accused the steel dealers’ association of deceiving the court since the losses because of their actions were estimated to be in billions.
The precise amount of these losses is not yet known since an investigation into the matter has not been completed.
Later, the court adjourned the case for one month.
Published in The Express Tribune, March 10th, 2011.
The Supreme Court of Pakistan on Wednesday directed the Federal Investigation Agency (FIA) to expedite investigation into the corruption at Pakistan Steel Mills (PSM), a government-run industrial unit.
Chief Justice Iftikhar Muhammad Chaudhry, presiding over the case, asked the PSM management to submit a forensic audit report of its accounts within a month, disregarding a plea entered by the Pakistan steel mill’s counsel Fakhruddin Ibrahim that the auditor preparing the report would not be able to complete it in less than three months.
Management officials at the state-owned enterprise are alleged to have sold steel at prices below PSM’s operational costs to as many as 469 steel dealers. Among alleged beneficiaries was the Pakistan National Shipping Corporation (PNSC), another state-owned enterprise that is also publicly listed on the Karachi Stock Exchange.
PSM reported a net loss of Rs26.5 billion in 2009, another loss of Rs11 billion in 2010 and has thus far accumulated a net loss of Rs5.7 billion in the first six months of the financial year ending June 30, 2011. The company has had to be bailed out by the federal government in 2010 through a Rs25 billion injection of capital into the firm.
The court ordered PSM to focus on minimising losses and recover money from people who had allegedly defrauded it. The court did not specify the mechanism for recovery of money. A case is yet pending against steel dealers accused of being involved in defrauding the PSM.
The lawyer for the steel dealers association said that his clients were cooperating with the investigation and the recovery process.
When PSM maintained that the association had returned just Rs25 million in compensation, the chief justice accused the steel dealers’ association of deceiving the court since the losses because of their actions were estimated to be in billions.
The precise amount of these losses is not yet known since an investigation into the matter has not been completed.
Later, the court adjourned the case for one month.
Published in The Express Tribune, March 10th, 2011.