Forex scam: FIA to file appeal against acquittal of Khanani and Kalia

FIA has forwarded the letter to the ministry of interior for legal advice and approval from the law ministry.

LAHORE:

The Federal Investigation Agency (FIA) Sindh has decided to file an appeal against the acquittal of eight persons implicated in a Rs103.8 billion foreign currency scam by Khanani and Kalia International (KKI) by a banking court.

FIA Director General Waseem Ahmed told The Express Tribune that he had directed the FIA to appeal the decision. The FIA has forwarded a letter to the ministry of interior for legal advice and approval from the law ministry.

The investigation and legal team of FIA Sindh has nearly finalised the draft of the petition to be filed in the Sindh High Court. Once the approval comes through, FIA will appeal the decision, revealed one of the investigators.

On March 4, 2011, four KKI directors and four bankers were acquitted on charges of operating an illegal money transfer system by a banking court in Karachi. Mir Muhammad Sheikh, the judge presiding over the case, had observed that the prosecution failed to present evidence that directly implicated Javed Khanani, Munaf Kalia, Hanif Kalia, Atif Polani and four bankers Syed Wajahat Ali, Arif Rehman, Tasleem Ahmed and Masood Altaf and ordered their release, unless they were involved in other crimes.

The directors of the company were accused of violating the Foreign Exchange Regulations Act, the Prevention of Electronic Crimes Ordinance and the Pakistan Penal Code by operating a money transfer system based on personal contacts, known as Hawala or Hundi. According to the FIA investigators, they violated laws meant to control the undocumented movement of capital across borders.

Investigations revealed that about Rs69 billion was legally transferred out of the country while Rs103.8 billion was transferred through Hawala or Hundi. KKI’s actions are alleged to have caused a major disruption in Pakistan’s currency operations and helped precipitate a sharp decline in the value of the rupee, which depreciated by 27 per cent during the year 2008, as claimed by FIA officials.

There are four cases pending against KKI in two other courts in Karachi and one each in Lahore and Peshawar. They have not yet been released, despite their acquittal.

Published in The Express Tribune, April 6^th,  2011.