• Overseas Pakistanis complain Rs410m went missing
• Caretaker govt’s legislative powers questioned

ISLAMABAD: The Senate Standing Commi­ttee on Finance and Revenue on Wednesday expressed serious concern over alleged frauds and embezzlements in depositors’ accounts at a private foreign bank.

The committee called on the managements of the State Bank of Pakistan (SBP), Federal Investi­gation Agency (FIA), and a foreign bank for a detailed investigation.

Chaired by Senator Saleem Mandviwala, the committee also questioned the caretakers’ legislative powers and requested caretaker ministers for law and finance to present their views in the next sessions.

The committee passed amendments to the SOEs (Governance & Opera­tions) Act 2023 despite opposition from the government.

Senator Bahramand Tangi had moved the “State Owned Enterprises (Governance and Opera­tions) (Amendment) Bill, 2023” to restrain the board of directors (BOD) and chief executive officers of SOEs from using company assets for political and monetary purposes, proposing disqualification for such actions.

He said the BODs of electricity distribution companies (Discos) also included members appointed on political basis and used SOEs assets and equipment for political purposes, besides interfering in the transfer and posting of Discos officers. In doing so, such members virtually exercised the powers of the vulnerable CEOs, whose appointments were also in the hands of the BODs.

Finance Secretary Imdadullah Bosal opposed the bill. However, after discussions, the committee made two amendments: firstly, reducing the required relevant experience for the CEO from 20 to 10 years, and secondly, changing the words ‘personal gains and political point-scoring’ to ‘personal and monetary gains.’ The amendment bill was then passed.

Complaint about fund missing

The committee took up a complaint by some overseas Pakistanis claiming that Rs410 million went missing from their accounts in Karachi.

The complainants said they had transferred the amount from Noor Bank Dubai to a foreign bank in Karachi, in 2017. However, last year when they went to the bank for withdrawal, the staff replied that they had already withdrawn the amount and closed their account.

The complainants said that bank officials had withdrawn their money by committing forgery. It was strange that while they were abroad, their deposits were being taken away without their knowledge.

They regretted that the bank and SBP were not extending any assistance and the SBP had even refused to receive the complaint and referred them to the banking ombudsman. Current­­ly, the matter was pending with the FIA.

Governor SBP Jameel Ahmed said the inquiry showed the complainants’ claim to be untrue and they had a total of 66 accounts. He said the FIA was probing the matter and the said bank had also filed a case in the Sindh High Court.

Senators expressed alarm over the situation. Senator Sadia Abbasi remarked that this was a very perturbing situation, questioning who would trust the banking industry to keep their funds in their accounts and make investments. She emphasised that it was the SBP’s responsibility as the regulator to address the situation. Sena­tor Kamil Ali Agha stated that it was a very dangerous thing to learn that bank officials could misuse depositors’ money, constituting a serious abuse of public trust.

Chairman Mandviwala asserted that the SBP should not defend the bank, expressing concern that the regulator was not registering depositors’ complaints, which he deemed as a negative sign. He mentioned that recent events had revealed the SBP’s failure to protect the interests of depositors. The committee decided to summon the governor of SBP, head of the foreign bank, and the director of FIA, along with investigating officers, to the next meeting for further investigation.

The panel also requested the caretaker ministers for law and finance to provide their point of view on whether the caretaker government had the powers to enact legislation. The issue arose in connection with two government bills related to depositors’ protection and banking companies when Senator Sadia Abbasi observed that the caretakers did not have the authority to engage in legislative business.

Published in Dawn, January 18th, 2024