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LAHORE: Tightening its noose around the sugar barons of the country, the Federal Investigation Agency (FIA) has registered two FIRs against estranged PTI senior leader Jahangir Khan Tareen and his son Ali Tareen for cheating the public (shareholders), criminal breach of trust and money laundering besides other charges. The FIRs, copies of which are available with Business Recorder, were registered under sections 406 (criminal breach of trust), 420 (cheating of public shareholders) and 109 of the Pakistan Penal Code (PPC) read with sections 3/4 of the Anti Money Laundering Act.

An FIA spokesperson said the FIRs were registered after JDW Sugar Mills, Ltd, Chief Operating Officer (COO) Rana Naseem Ahmed Khan and Chief Financial Officer (CFO) Muhammad Rafique deliberately avoided personal appearance six times before a combined investigation team (CIT) probing the multi-billion sugar scam at its Temple Road office.

The spokesperson said that Rana Naseem, also former Lahore commissioner and secretary agriculture Punjab, is presently working as the COO of the JDW Sugar Mills Group and is the right hand of prime minister’s once close friend Jahangir Khan Tareen.

Meanwhile, an FIA team went to the residence of Naseem in DHA Phase-5 to serve him another call-up notice directing him to appear before the agency on April 2 otherwise strict legal action would be taken. However, Muhammad Rafique has been summoned on April 1 through another call-up notice and he would be arrested in case of non-compliance of the order.

It may be mentioned that heads of accounts and sales of the Chaudhry Sugar Mills of the Sharif family, who were summoned by the FIA today failed to appear before the investigators.

According to the first FIR against Tareen, a fraudulent and premeditated scheme of misappropriation of public shareholders' money by Jahangir Khan Tareen has surfaced whereby JDW (a public ltd listed company - CEO Jahangir Khan Tareen) fraudulently transferred Rs 3.14 billion to an associated private company - Farooqi Pulp Mills Ltd. Gujrat (FPML) - owned by his son and close relatives. The transfers, especially after FY-2011/12, were patently fraudulent investments, which ultimately translated into personal gains for the family- members of CEO JDW. The FPML Gujrat was incorporated in 1991, by Mian M Akbar Faruki family, to produce paper-pulp from eucalyptus. This venture was a non-starter ab-initio and was closed after its failed trial-run in 1997. It was a non-starter due to an intrinsic design fault and absence of sufficient raw-material eucalyptus coupled with an impractical idea to convince farmers on eucalyptus farming as the plant drastically depletes water table by consuming a lot of water, which is otherwise scarce in local arid climate. However in 2007/08, Jahangir Khan Tareen practically took over the control of affairs of FPML with premeditated design and appointed Shahid Saleem Rana as CEO/CFO of FPML. He not only made investments of Rs 395 million in FY 2009 and Rs 165 million in FY 2010 into FPML which had already defaulted but also committed JDW as FPML’s guarantor (in the form of sponsor's support agreement) in securing Rs 1.4 billion loan for FPML from a Pak-Brunei investment consortium. The JDW investments were not driven by financial propriety but were due to close relationship of CEO JDW Jahangir Khan Tareen with his son-in-law Waleed Akbar Faruki (FPML). Nevertheless, despite being in full knowledge of the facts that FPML had been practically shut down and was selling its assets, the JDW's investments of 2009/10 were neither retrieved nor booked as a permanent 'impairment loss" in FY-2011/12. In-fact, Jahangir Tareen kept on transferring JDW's funds as 'advances' to FPML (even after FY-2011/12) and by 2014 he had transferred an additional Rs 1.48 billion to FPML. Instead of treating these JDW advances as (recoverable) liabilities, he converted them into JDW's equity investment in FPML - which was not a going concern. Without any business activity by FPML whatsoever, CEO JDW Jahangir Khan Tareen kept on transferring JDW's funds to FPML and by 2015 had transferred yet an additional Rs. 1.10 Billion to FPML. Again, instead of treating these JDW advances as (recoverable) liabilities, he converted them again into JDW's equity investment in FPML - which had not been a going concern since 2011/12.

The second FIR states that during the course of inquiry, a premeditated scheme of misappropriation of public shareholders' money by Jahangir Khan Tareen has surfaced whereby voluminous withdrawals amounting to at least Rs 2.2 billion from the accounts of JDW {from October 2017 to March 2020) were fraudulently and dishonestly made through a trusted cash-rider Amir Waris who is employed as cashier in JDW's Corporate Head Office.

“During the inquiry, a fake account, with aggregate credit-deposits of Rs 5.8 billion from extraneous sources (2008 to 2013) closely associated in making credit transactions to the JK Farming Ltd. (Rs. 26 Million), JK Dairies Pvt. Ltd. (Rs. 25 Million) and ATF Mango/Ali Tareen Farms (Rs. 14 Million) were unearthed,” the FIR reads. It further states that this account was styled as Riaz Traders and operated in the name of Malik Riaz Ahmed, a low-profile office boy of one of the major sugar brokers of JDW - Majid Malik. The inquiry also determined that JDW Chief Operating Officer Rana Nasim Ahmed, being a principal facilitator, had been given huge “undue amounts” to the tune of nearly Rs 600 million per annum from JDW's accounts. Earlier this week, the FIA had summoned the chief financial officers and heads of sales of eight major sugar groups in connection with the “speculative price-hike” of the sweetener. The FIA had summoned CFOs and heads of sales of PTI’s Tareen’s JDW Sugar Mills on April 2, Maryam Nawaz and Sharif family’s Chaudhry Sugar Mills on March 31, Punjab Assembly Opposition Leader Hamza Shahbaz’s Ramzan Sugar Mills on April 2, Madina Sugar Mills of Kissan group on April 7, Hamza Sugar Mills on April 8 and three others in the sugar scam. The owners of these sugar groups will be summoned at the later stage, the agency had said. According to the FIA, the sugar barons pocketed nearly Rs110 billion during the last year through alleged speculative price hike with the help of satta mafia. Last week, the FIA had also registered an FIR against Tareen’s JDW group and Gourmet Bakers & Sweets Pvt Ltd, Lahore, under sections 420, 468, 471 and 109 of the PPC, read with sections 3/4 of Anti-Money Laundering Act 2010.

Copyright Business Recorder, 2021

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