Graft scandal: Court orders FIA probe into EOBI scam

SC asks director general to submit a report within 10 days.

ISLAMABAD: The Supreme Court on Monday issued instructions to the Federal Investigation Agency (FIA) to investigate a multibillion corruption scam in the Employees’ Old Age Benefit Institution (EOBI) and submit a full report within 10 days.

A three-judge bench, headed by Chief Justice Iftikhar Muhammad Chaudhry, ordered the agency’s director general to conduct an independent inquiry and take indiscriminate action against the culprits. The court also ordered investigation into all charges of misappropriation and irregularities, particularly over 18 transactions.

The bench also directed the interior secretary to cooperate with the FIA by providing him the human resources required to probe into the case.

Justice Chaudhry remarked that under Article 9 of the Constitution the money belonged to the taxpayers and to those who were beneficiaries of the EOBI fund “but it was used illegally to benefit some individuals.”



The FIA’s director general informed the court that “irrefutable evidence of corruption” showed that the commission on the invested money was transferred to the bank accounts of EOBI’s former chairman Zafar Iqbal Gondal and its director general.

The names of both men had been put on exit control list (ECL). He also told the bench that three other officials – EOBI’s former director general Wahid Khursheed Kanwar, Maham Majeed and Col (retd) Ali Asad Mirza – had been arrested, adding that two other men Muhammad Qasim Pervaiz and Iqbal Daud, allegedly involved in the case, had already obtained their transitory bails.

Appearing before court, the ministry of oversees and human resource development secretary, Abdul Khaliq, said that when he took over the EOBI’s new head was not appointed.

He acknowledged that billions of rupees had been misappropriated, adding that he had stopped some further payments and work on certain projects. He told the court that the Investment Board had been used to purchase properties from DHA and other individuals at prices many times higher than the market price.

The secretary said Rs15 billion was spent just to buy a plot of land measuring 321.3 kanals whose market price was far less. “Investment was made in violation of all rules and regulations, and some other plots worth Rs6 billion were also purchased from DHA,” Abdul Khaliq said. The secretary also informed the court that Rs41 billion had been invested in the share market.

The chief justice lamented that Rs15 billion of poor labourers was given away to the DHA and no one was held responsible. Calling into question the housing authority’s integrity, the court asked who was responsible for distributing free land to the housing authority.

DHA ex-director Town Planning Colonel retired Tariq Kamal appeared before the court and informed that Brigadier Javaid Iqbal had made the deal, to which he had raised objections. He said he communicated his objections to Lieutenant General Javaid Iqbal both in writing and verbally. “However, nothing happened and I was fired in a few days,” he added.

Observing that Javaid Iqbal appeared to be a highly influential individual, the court asked if it was an individual or collective act. Tariq Kamal replied that it was a collective decision as everyone was aware of it.

The chief justice said that the alleged EOBI employees had been given a chance to escape. Justice Ijaz Ahmed Chaudhry observed that in all the deals only half of the money was given to the owners while the rest of the amount was pocketed by some individuals.

The chief justice said if he had not spoken so far it was because the name of a high-profile personality was involved in it.

The court, acting upon Tariq Kamal’s request that he and a press reporter Huziafa were being threatened, directed the inspector general of Islamabad and Punjab police to provide them protection.  Proceedings were later adjourned till July 12.

On June 29, the chief justice took suo motu notice over a note sent by the court registrar, based on a TV programme aired suggesting that the institution had violated article 9 (security of person) and 24 (protection of property rights) of the Constitution.

The EOBI had allegedly caused a loss of Rs40 billion to the exchequer by investing huge amounts in private sector projects without approval of its board of trustees.

Published in The Express Tribune, July 2^nd, 2013.