Over the past four years or so, or to be precise, since the publication of the Panama papers in April 2016 corruption has remained the major political pre-occupation in Pakistan. Things became more intense as the PTI-led coalition government of Prime Minister Imran Khan took over the reins in Islamabad in August 2018 and started an obsessively one-sided persecution of the leaders of the main opposition parties. And as the government entered its half-way mark in 2021 the mess had turned into an attritional crusade between the ruling coalition and the opposition conglomerate, the Pakistan Democratic Movement (PDM.)
But since the recent sensational disclosures by the former Chief of the liquidated Broadsheet LLC, Kaveh Moussav the matter has assumed a catastrophic proportion with Pakistan, already losing millions of dollars by way of compensation/fine to the liquidated company with the possibility of further drain on our official financial resources not ruled out until perhaps an out of court settlement is made or the tables are turned on the main claimant.
Here is a precise account of the scandal in question: In 2013 the National Accountability Bureau (NAB) accepted a plea bargain offer from former chief of naval staff Admiral Mansurul Haq to pay about Rs. 457.5 million (US$ 7.5 million) in return for dropping all corruption cases against him. In 2015, Lt-General Zahid Ali Akbar (retd) returned Rs200 million of misappropriated funds in a plea bargain to the National Accountability Bureau (NAB). In a recent settlement (Dec. 2019), real estate tycoon, Malik Riaz Hussain, handed over 190 million pounds (approximately $248m) held in the United Kingdom to settle a corruption investigation. The investigation was conducted by the UK’s National Crime Authority (NCA) on request from Pakistan’s Asset Recovery Bureau chief, Shahzad Akbar.
Earlier, Musharraf had made politically expedient arrangements without consulting NAB such as sending the entire Sharif family that was named in the NAB target list of 200 into exile to Saudi Arabia under a secret deal. Later, he withdrew cases in Swiss Courts against Benazir Bhutto and her husband Asif Ali Zardari because of the NRO. Finally, cases were withdrawn against people that were required by the military government of General Pervez Musharraf (retd) as partners. For instance, NAB and foreign investigators were asked to stop pursuing cases against Aftab Sherpao, who joined the Musharraf government. Similarly, NAB was not forthcoming in arresting Amir Lodhi who was nominated in the corruption scandal of the French Agosta 90-B submarines.
However, the NRO was declared unconstitutional by the Supreme Court of Pakistan on 16 December 2009, and all corruption cases withdrawn by Musharraf were reopened. Three cases were instituted against Nawaz. In one case the Islamabad High Court in response to an appeal ruled there was no corruption, in another case the ruling of conviction became controversial as an accountability judge was found guilty of acting under blackmail and in the third the accountability court itself ruled not guilty.
To put the matter in its proper context, it would not be out of place here to recall that the first chief of NAB (formed in 2000) was eager to investigate and bring to book the following armed forces personnel as well: Air Chief Marshal Anwar Shamim (retd), Brig. Imtiaz (retd), (late) Lt-General Fazl-e-Haq, Air Chief Marshal Abbas Khattak (retd) and Hamayun Akhtar Khan s/o Lt. General Akhtar Abdul Rehman. Amjad and his team had prepared a list of 200 people including the above named to be targeted for corruption investigation that included politicians, senior bureaucrats, and media owners.
Given resource limitations, General Amjad had jumped at the first opportunity to hire a foreign company that had offered to investigate, locate and retrieve money for NAB, not for a fee but in return for a 20 per cent share in what it helped recover as well as monies recovered by NAB internationally and signed an irrevocable agreement with Broadsheet LLC.
The agreement with Broadsheet LLC signed in 2000, for obvious reasons, was terminated in 2003. As a result of the termination, and the damages claimed by the liquidated company, Pakistan has already lost $21.5 million in fine/penalty after a London court ruled in a case of arbitration.
Kaveh Moussavi, the CEO of Broadsheet LLC (now in the possession of a liquidator), claims that 20 % of every penny recovered by the NAB since the agreement was signed to date (notwithstanding its termination) and counting should be shared with the liquidated company.
According to NAB, since its inception to date it had recovered Rs. 700 billion. This would mean that technically NAB owed to the liquidated Broadsheet 20% of the amount that would have accrued to NAB starting from withdrawal of the Nawaz Sharif’s name from the targeted list to all future recoveries of NAB made since, inside and outside of Pakistan. He has also suggested that the $1 billion belonging to a Pakistani national that apparently was transferred from a Saudi Bank to a Singapore Bank had been disclosed to the Pakistani government in 2017. But the deal in this particular case could not go through because according to him some uniformed personnel from Pakistan had asked for a ‘cut’.
In the face of all this, and more revelations that are said to include even more players the whole Broadsheet scandal sounds like it has the potential to blow up in the face of literally everyone involved. Whether it does or whether it goes quietly with a whimper is not clear. What is perhaps most pertinent about this whole incident is the question of how accountability is carried out in Pakistan.
But then, it is not only in Pakistan that corruption has become the political preoccupation of governments and opposition. In many other countries as well the situation appears to be no different.
According to a Transparency International’s newsletter dated January 15, 2021 the year is off to a rough start for some heads of state around the world who are being confronted with their missteps: Last week the Estonian Prime Minister resigned over a corruption investigation involving his party. Prime Minister of Israel, Benjamin Netanyahu is not faring much better; since his indictment for corruption calls for him to resign are becoming louder with each passing day. rising in their pitch. In Belarus, protests have been raging for six straight months against President Alexander Lukashenko after he was declared winner of the dubious and heavily fettered presidential election in 2020. Bulgaria has also seen daily anti-government protests for months against corruption and state capture during the reign of Prime Minister Boyko Borissov. In fact, state capture is a deeply troubling trend observed also in Georgia as well as Western Balkans and Turkey.
Corruption allegations are also catching up with several former leaders. Last week, two former prime ministers in Algeria went on trial for corruption; in Romania, former prime minister is being investigated for suspected bribe-taking; and South Korea upheld former president Park Geun-hye’s 20-year prison sentence for bribery. In?France,?in a landmark trial for corruption,? former president Nicolas Sarkozy might be facing a four-year prison sentence, including a two-year suspended sentence for?corruption and bribery.
However, in far too many places around the world, grand corruption – abuse of high-level power to benefit the few at the expense of the many – goes unpunished. This is largely because the current international anti-corruption framework does not adequately address challenges in prosecuting corruption implicating political leaders.
In far too many parts of the world, high-level public officials are robbing entire populations of the chance of a sustainable future. The uncomfortable truth is that advanced economies are enabling or even fueling this kind of corruption. Abuse of shell companies is among the reasons why many countries are facing greater challenges today in dealing with the grand corruption. For decades, companies with anonymous owners have enabled grand corruption and other crimes. This has meant that public resources that could have served to improve healthcare systems and education facilities for the have-nots, were embezzled from public coffers.
That is exactly what a diverse group comprising trade unions, leading academics and civil society have said in an appeal to UN General Assembly Special Session against Corruption (UNGASS) 2021. The joint letter asks government leaders to endorse central, public registers of beneficial ownership as a global standard. “A central, public register of companies and their ultimate beneficial owners – in addition to information on legal ownership and directors is the most effective and practical way to record such information and facilitate timely access for all stakeholders,” reads the letter signed by 22 organizations as well as the economists Thomas Piketty and Gabriel Zucman. Stolen money is often hidden in richer countries, in real estate, company shares or bank accounts. Consider Isabel dos Santos, whose assets were seized earlier this year in Portugal at the request of Angolan authorities. But there are numerous barriers to returning assets to their rightful owners, even when they are located and confiscated. Over the last ten years, only one third of international asset recovery cases have resulted in returns.
Beneficial ownership information – information on the natural persons who ultimately own, control or benefit from a legal vehicle – enables cross-border enforcement and the tracing of ill-gotten assets for confiscation and return.
Copyright Business Recorder, 2021