FIA books Tareen, Shehbaz in sugar crisis case

Files separate FIRs including charges of cheating, breach of trust, fraud and money laundering


Our Correspondent November 15, 2020

LAHORE:

The Federal Investigation Agency (FIA) has registered separate first information reports (FIRs) against PTI leader Jahangir Tareen and PML-N President Shehbaz Sharif in the sugar crisis case. Other accused include Tareen’s son Ali Tareen, and Shehbaz’s sons Hamza Shehbaz and Suleman Shehbaz.

These politicians are booked on charges of cheating, criminal breach of trust, fraud and money laundering. The FIRs were registered at the FIA’s Anti-Corruption Circle Lahore.

An inquiry commission made stunning revelations in May about how sugar barons had cheated farmers, benefited from subsidies and created conditions so that the price of sugar would go up.

The commission – headed by FIA Director-General Wajid Zia – was formed by the PTI government to probe into the causes of sudden spike in sugar prices in January this year.

Tareen was among those accused of benefiting the most from the crisis.

The report said six major groups controlled 51% of the total sugar production and Tareen’s JDW Mill had the biggest share – 20% of the total production. His mills made Rs200 billion in three years.

They were also found to be running double books. The mills were also underreporting their revenue. Tareen and his son left Pakistan for London soon after the report was made public.

They returned recently, after seven months. The PTI leader was disqualified from holding public office on January 30, 2018 but remained a senior member of the party.

The JDW Sugar Mills comprises three units, two of which are located in Rahim Yar Khan in south Punjab and one is located in Ghotki, Sindh. It accounts for 17% of the country’s total sugar production.

Suleman Shehbaz is in London and has not appeared before the FIA despite repeated summons. The Sharifs’ Al Arabia Sugar Mills were also accused of benefiting from the crisis.

The Competition Commission of Pakistan (CCP) – the entity responsible for ensuring fair play in the market – also made interesting revelations in its report issued in Oct on basis of a 10-month long inquiry.

According to the CCP, the Pakistan Sugar Mills Association (PSMA) – the representative body of sugar mills – is prima facie a “cartel” that manipulated the recent price hike with active coordination of a senior officer of JDW Sugar Mills Group.

The report claimed that the PSMA was indulged in illegal activities and violated the Competition Act of 2010. The findings also showed that the millers managed to influence the PTI government to allow export of 1.1 million tons of sugar, which also caused a 48% increase in the prices.

“It appears that starting from 2012 to date, the conduct of PSMA and all its members vis-à-vis collective discussion on stock positions leading to a decision on the quantity to be exported is tantamount to fixing or setting/controlling supply within the relevant market has resulted in price hike that is not based on actual/available supply and demand.

“It is a prima facie violation of Section 4(1) read with Section 4(2)(c) of the Act. Mills have been found to coordinate their production and stock figures based on which decisions on export quantities are made,” the report said.

It was the second time in the last 10 years the CCP declared that the PSMA was a cartel but this time the nature of “crime” appeared more serious.

(With additional input from DNA)

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