ISLAMABAD: The defence ministry could not recover Rs1.53 billion embezzled by its 81 army and civilian officers even after about two decades.

On Monday the defence ministry representative told the sub-committee of the Public Accounts Committee (PAC) that they could only recover Rs29 million.

According to the representative, majority of the ministry officials avoided penalties and legal action against them through litigations.

These details came to light during the scrutiny of a special audit report at the meeting of a sub-committee of the PAC. The scam took place during 1992-97 and was uncovered by the audit authorities in April 2001.

A defence ministry representative informed the meeting that the 81 military and civilian officials were investigated and found guilty of having embezzled Rs1.53 billion from the accounts of the Military Engineering Services (MES). This sum was siphoned off thanks to fake purchases, fictitious spending and fraudulent payments.

The amount had been embezzled during 1992-97

Explaining its efforts to recover the amount, Akmal Hussain, the chief engineer of the defence ministry, told the committee that Rs29.7 million were recovered from the accused officers. “In addition, two plots worth Rs6 million each in the Defence Housing Authority (DHA) Islamabad were confiscated.”

According to the details provided in the audit, the 11 officials who were involved in the embezzlement have died; 33 civilian officials challenged the proceedings against them and were exonerated by the Federal Service Tribunal (FST). The defence ministry, however, has filed an appeal against the FST decision, which is pending. Hussain added that the money had been recovered from the rest.

Additional secretary defence Air Vice Marshal Imran Khalid told the committee that eight officers were dismissed from service without any post-service benefit due to the financial scandal.

He explained that the two DHA plots were confiscated from Colonel Jahangir Alam and Mohammad Ijaz. “However, Lt-Col Mohammad Idrees, another accused, fled abroad though the ministry of interior had been asked to bring him back through Interpol.” He added that Rs75 million had been recovered from Col Idrees.

The audit officials, however, pointed out that no money could be recovered from those who had died or retired.

Under the rules, in such cases, money can be recovered from a retired officer within 12 months of retirement while in this case the accused officials had retired years ago.

The PAC sub-committee, headed by Rana Afzal Hussain, directed the defence ministry to identify those officials who failed to take steps to recover the money.

“What action has been taken against those who failed to recover the money within time,” asked PAC member Shahida Akhtar Ali.

The committee also expressed its dissatisfaction over the slow pace of recovery. In this regard, Rana Afzal commented: “It is not acceptable that after years you people simply recover Rs29 million and two plots when Rs1.53 billion were looted.”

Apart from this, the committee deferred discussing a number of audit paras after the defence ministry officials pointed out that the matters related to these paras were sub judice.

“You should constitute a committee to determine the role of those officials whose lethargic attitude resulted in the litigation,” Rana Afzal added.

The committee directed the defence ministry to take up these audit objections in the departmental accounts committee and expedite the process for their settlement.

The audit authorities also pointed out that unauthorised disposal of and illegal occupation of defence land, illegal and extra expenditures, non-recoveries and loose financial control had caused a loss of Rs800 million to the national exchequer.

The French connection

The audit authorities informed the committee that the defence ministry did not provide them documents related to an audit para about the damage caused to helicopters hired by French filmmakers.

The filmmakers hired two PUMA helicopters from the Army Aviation in January 1987. The helicopters were damaged in an accident. A court of inquiry was held which recommended the recovery of the cost of damage from the users.

However, the audit report revealed that the then chief of general staff decide to write off the loss and not claim any damage.

In 1997, the audit authorities suggested PAC “order an inquiry to fix responsibility for failure to safeguard the state interest.” But it still did not lead to any reimbursement.

The PAC and the departmental accounts committee took up the matter in 2001 and 2014, respectively.

On Monday, when the matter was discussed again, the committee asked the audit authorities to get further details from the defence ministry.

Published in Dawn, February 24th, 2015

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