Rs13b money laundering scam unearthed

Six firms found involved in over-invoicing during import of solar panels

KARACHI:

The Directorate Post-Clearance Audit of the Federal Board of Revenue (FBR) has exposed a whopping Rs13 billion money laundering scam involving over-invoicing during the import of solar panels.

Sources close to the investigation informed The Express Tribune that the directorate has identified six fraudulent solar panel companies after customs clearance. These fictitious entities funneled Rs13 billion of black money abroad, with three companies based in Karachi and three in Quetta. The six fake companies are SH Traders, Saher International, Dekta Trading, Ahsan Ullah Import Export, Smart Impax, and Asad Ullah Enterprises.

Post-Customs clearance audit revealed that these six fraudulent companies submitted 687 goods declarations for the clearance of their imported solar panels with over-invoicing detected in 443 of these declarations. This over-invoicing involved falsely inflating the value of imported solar panels, resulting in the laundering of Rs13 billion.

Sources further revealed that these fake companies reported the cost of imported solar panels as Rs13 billion whereas their actual value was only Rs9 billion. Two importers, Smart Impax and Asad Ullah Enterprises, sold solar panels worth Rs4 billion and Rs2.4 billion in the market, respectively. The Customs teams have registered six new cases and formed teams to apprehend the culprits.

Meanwhile, Abdul Aziz, the owner of Asad Ullah Enterprises, who operated his company from an office in Quetta, has been arrested, and the Customs has obtained a six-day remand. Initial investigations revealed that Aman Ullah is the real owner of this fake company. Aman Ullah had entrusted the company to his cousin Abdul Aziz and paid him a monthly sum of Rs30,000 to pose as the owner.

Sources suggest that the money laundering and over-invoicing mafia exploited the green channel for solar panels. The Customs team, led by Member Customs FBR Zeba Hai, Director-General Post Clearance Chaudhari Zulfiqar Ali, and Director PCA South Sheeraz Ahmed, is working to curb money laundering.

It has come to the light that these mafias, engaged in over-invoicing and money laundering from 2017 to 2023, have been transferring black money amounting to billions of rupees to various Chinese companies via Dubai. The total financial capacity of all six fake companies is reported to be Rs66 million, and concerned banks approved their Form I for imports, overlooking their true financial status.

 

Published in The Express Tribune, October 8^th, 2023.