Corruption charges: ‘Rs40b EOBI scam’ under the scanner
Chief justice takes suo motu notice; summons EOBI chairman and his predecessor.
Chief justice takes suo motu notice; summons EOBI chairman and his predecessor. PHOTO: FILE
ISLAMABAD:
Chief Justice Iftikhar Muhammad Chaudhry on Saturday took suo motu notice of a media report regarding alleged corruption amounting to over Rs40 billion in the Employees Old Age Benefit Institution (EOBI). The court will formally start hearing on July 1.
Responding to a note forwarded by the Supreme Court registrar, Justice Chaudhry took notice of the graft allegations and summoned the incumbent EOBI chairman and his predecessor, Zaffar Iqbal Gondal, along with the attorney general, secretary of the human rights development ministry and director general of the Federal Investigation Agency (FIA).
The registrar’s note, which is based on a television programme, alleges that the EOBI lost billions of rupees to corruption over the last three years. It accuses Gondal, the EOBI’s director general (Investment) and the director general (Human Resource) of involvement in the scam.
“Reportedly, they have invested billion of rupees in the private sector, contrary to rules and without the approval of the Board of Trustees and thus plundered more than Rs40 billion,” stated the official press release issued by the public relations officer of the apex court.
The note makes several allegations, many of which involve the purchase of land at a cost higher than the market value without the approval of the Board of Trustees.
The EOBI management purchased one such plot, for instance, for Rs16 billion against the land’s actually market value of Rs1 billion, according to the release. It cites Transparency International Pakistan as pointing out that a notable Pakistani businessman was involved in the deal and that payments were made despite a Lahore High Court stay order.
Similarly, the note mentions the purchase of a property in Islamabad for Rs1.2 billion against a market price of Rs550 million.
According to the press release, the EOBI management purchased two controversial plots in Sukkur for Rs120 million – much higher than their actual market price – under pressure from a Pakistan Peoples Party senator as well.
It also mentions the purchase of seven plots from the Capital Development Authority in violation of an LHC order. Another allegation involves the purchase of 40 kanal land in a village outside Lahore for Rs1.43 billion – 300% than its actual value. The EOBI allegedly paid Rs2 billion for a piece of land near Karachi airport which was valued no higher than Rs200 million.
The EOBI also allegedly purchased four floors and the parking area of a hotel in Lahore for Rs250 million and Rs350 million, respectively, according to the release. But despite allegedly spending another Rs50 million on renovation, the EOBI was unable to generate any income from the investment.
Gondal allegedly involved the EOBI in bidding Rs6 billion for the construction of the M-9 Motorway, contrary to rules which allow no risky investment, the release stated. Similarly, under the former chairman, the EOBI invested Rs60-80 million to develop a cricket ground in Islamabad – a move that failed to generate revenue as well.
Gondal allegedly stopped work on an Rs5 billion seven-star hotel project near Lahore airport in 2005, leading to the imposition of a heavy penalty on the EOBI. Apart from the aforementioned allegations, the release stated that Gondal purchased two 4,300cc vehicles for Rs40 million for his own use, despite being authorised to use only a 1,300cc vehicle.
Published in The Express Tribune, June 30th, 2013.
Chief Justice Iftikhar Muhammad Chaudhry on Saturday took suo motu notice of a media report regarding alleged corruption amounting to over Rs40 billion in the Employees Old Age Benefit Institution (EOBI). The court will formally start hearing on July 1.
Responding to a note forwarded by the Supreme Court registrar, Justice Chaudhry took notice of the graft allegations and summoned the incumbent EOBI chairman and his predecessor, Zaffar Iqbal Gondal, along with the attorney general, secretary of the human rights development ministry and director general of the Federal Investigation Agency (FIA).
The registrar’s note, which is based on a television programme, alleges that the EOBI lost billions of rupees to corruption over the last three years. It accuses Gondal, the EOBI’s director general (Investment) and the director general (Human Resource) of involvement in the scam.
“Reportedly, they have invested billion of rupees in the private sector, contrary to rules and without the approval of the Board of Trustees and thus plundered more than Rs40 billion,” stated the official press release issued by the public relations officer of the apex court.
The note makes several allegations, many of which involve the purchase of land at a cost higher than the market value without the approval of the Board of Trustees.
The EOBI management purchased one such plot, for instance, for Rs16 billion against the land’s actually market value of Rs1 billion, according to the release. It cites Transparency International Pakistan as pointing out that a notable Pakistani businessman was involved in the deal and that payments were made despite a Lahore High Court stay order.
Similarly, the note mentions the purchase of a property in Islamabad for Rs1.2 billion against a market price of Rs550 million.
According to the press release, the EOBI management purchased two controversial plots in Sukkur for Rs120 million – much higher than their actual market price – under pressure from a Pakistan Peoples Party senator as well.
It also mentions the purchase of seven plots from the Capital Development Authority in violation of an LHC order. Another allegation involves the purchase of 40 kanal land in a village outside Lahore for Rs1.43 billion – 300% than its actual value. The EOBI allegedly paid Rs2 billion for a piece of land near Karachi airport which was valued no higher than Rs200 million.
The EOBI also allegedly purchased four floors and the parking area of a hotel in Lahore for Rs250 million and Rs350 million, respectively, according to the release. But despite allegedly spending another Rs50 million on renovation, the EOBI was unable to generate any income from the investment.
Gondal allegedly involved the EOBI in bidding Rs6 billion for the construction of the M-9 Motorway, contrary to rules which allow no risky investment, the release stated. Similarly, under the former chairman, the EOBI invested Rs60-80 million to develop a cricket ground in Islamabad – a move that failed to generate revenue as well.
Gondal allegedly stopped work on an Rs5 billion seven-star hotel project near Lahore airport in 2005, leading to the imposition of a heavy penalty on the EOBI. Apart from the aforementioned allegations, the release stated that Gondal purchased two 4,300cc vehicles for Rs40 million for his own use, despite being authorised to use only a 1,300cc vehicle.
Published in The Express Tribune, June 30th, 2013.