SATURDAY DECEMBER 17: Rich persons using 'benami bank transactions': DG I&I unearths new fraud technique

ISLAMABAD: The Directorate General of Intelligence and Investigation (I&I) Inland Revenue (IR) has unearthed a new fraud technique used by some rich persons who are using bank accounts of their poor non-taxpayer employees and other accounts for carrying out 'benami bank transactions' to remain out of the documented regime of FBR.
Sources told Business Recorder here on Friday that some rich persons have been involved in massive concealment of taxable income by carrying out 'benami bank transactions' with the help of low paid employees who are not even taxpayers. Other accounts have also been opened in the same bank to conduct such financial transactions.
The Directorate of Intelligence IR has started checking 'benami banking transactions' with the help of databank and third-party information to detect nexus of some rich persons and their poor employees to use the bank accounts of non-taxpayers for carrying out such transactions. Different accounts have been opened in the same bank to carry out transactions from several bank accounts.
These accounts have been operated in such a way that main transactions have been carried out in the accounts of the poor employees but other accounts in the same bank have been used to transfer money through several transactions. The nexus among these banks accounts has been established with the help of detailed analysis of the available data and repeated transactions among these accountholders.
This is for the first time that the intelligence agency of the FBR is focused on 'benami bank transactions' which is difficult to detect unless or until the complete particulars of the accountholders, their computerised national identity card numbers (CNICs), telephone numbers, bank accounts and other relevant details are available.
Without complete details of all close relatives and employees, it is impossible to detect such 'benami transactions' conducted to avoid payment of taxes and banking transactions within the documented regime. Following detection of such new fraudulent technique, the FBR has now practically detecting financial crimes using sophisticated techniques. The entire chain of fraudulent persons has been unearthed without giving them any clue of investigation.
This new trend of investigation being carried out by the Directorate of Intelligence IR will bring rich persons using poor employees' bank accounts to carry out transactions to conceal their income. The directorate had to apply sophisticated techniques to detect 'benami bank transactions' with the help of experts to nab all the accountholders involved in concealment of taxable income of the rich person.
This is for the first time in the history of Pakistan that the 'benami bank transactions' has been successfully detected by the Directorate of Intelligence IR which would play a key role to hunt the rich persons using fraudulent techniques to avoid documentation and payment of taxes. This is not possible without thorough scrutiny and analysis of accountholders data to prove 'benami bank transactions'.
Sources said that the modus operandi adopted by these persons is that a rich person opens a bank account in the name of his poor employee. The CNIC of the poor person is used to open the bank account. The poor person has nominated the son of his employer as "next of kin". In the presence of his sons, the son of employer has been declared as "next of kin" of the poor employee. The relationship between the poor employee and son of the rich employer has been shown as 'cousin'. The banking transactions have been done in the account of the poor employee.
In the same bank, son of the owner of the rich person has also maintained the account. Another account has also been maintained in the same bank where the mobile phone number of the third bank account holder and account of poor employee is the same. How, the same mobile phone number has been mentioned in the A/C opening form of the poor employee and the third bank account.
There are interbank transactions in the said three accounts of the same banks reflected financial connections among the accountholders. This also shows that how different bank accounts have been opened in the same bank to carry out banking transactions after depositing huge amounts in the bank account of the poor employee.
A latest case detected by the FBR's Directorate of Intelligence IR showed that the agency unearthed a case of massive concealment wherein through benami bank transactions, huge taxable income is being channeled in the hands of a low paid employee who is not an existing taxpayer.
The facts of the case showed that assume some one Sohail reportedly a Store Keeper at the business premises of his employer (Junaid) in Faisalabad, opened A/C at a bank. A/C opening form irrefutably connects this benami A/C with Imran, (S/O Junaid) because he appears as the Next of Kin. Why Sohail nominated Imran as the next of kin in the presence of his own sons, daughters and spouse, is the basic question which proves the factum of benami.
While nominating Imran as next of kin, the relationship between Sohail and Imran has been shown as "Cousin". This is also a false statement. Authorised as well as specimen Signatures of Sohail as appearing on A/C opening form are totally different from his normal signatures on his CNIC. Even a cursory look confirms that actually Imran had signed the A/C opening form of this benami A/C.
Within a short span of nearly ten months period of 2010 to 2011, (when the A/C was closed) an amount of around Rs 340 million was deposited in the aforementioned A/c. Bank A/C statement is witness to huge credit and debit entries. Interestingly, Imran also maintains A/C with the same bank. There is yet another A/C at the same branch in the name of Tanvir. Details further showed that there is very interesting trail which establishes an intriguing but undeniable nexus among all the three aforesaid A/Cs. A A mobile telephone number appears at the A/C opening forms, Bank A/C statement of Sohail.
The said number also appears on the A/C opening form and bank A/C statement of Tanvir. The same number appears as the contact number of Imran when he is introduced as next of kin by Sohail. A mobile telephone number appears on the A/C opening form of Sohail. The same number is in use of Imran and interestingly this is a post-paid number issued in favour of a business concern of Faisalabad. The Interbank transactions in all the three aforementioned A/Cs also prove financial connection as well. The ground check also confirms that Imran is the real owner of the said A/Cs which all have been opened, maintained and operated by him.
Tax profile of Imran has been obtained by the agency which fails to account for the aforesaid concealed A/Cs and massive transactions therein. Rental income reflecting in his returns also needs to be probed, because apparently his declared income over the years does not match with the investment in the said properties, the Directorate of intelligence IR said.