Senate Panel Uncovers Massive Over-Invoicing; SBP Criticized for Lack of Cooperation
ISLAMABAD: Shocking revelations surfaced in a Senate sub-committee meeting on Thursday, exposing over Rs110 billion in fraudulent transactions and money laundering under the pretext of solar imports. More than 80 companies, including several dummy entities, were found involved in large-scale financial malpractice.
The Senate Standing Committee on Finance, chaired by Senator Mohsin Aziz, pledged to intensify investigations and ensure accountability. However, the committee strongly criticized the State Bank of Pakistan (SBP) for its reluctance in sharing crucial financial data related to the case.
Massive Over-Invoicing Uncovered
Officials from the Federal Board of Revenue (FBR) revealed a shocking pattern of over-invoicing and trade-based money laundering. In one instance, a company imported solar panels worth Rs2.29 billion but falsely declared sales exceeding Rs2.58 billion.
The FBR investigation found that Rs106 billion had been transferred under the guise of solar imports, with Rs69 billion linked to over-invoicing. Among the 80 implicated firms, 63 were flagged for financial misconduct.
Bogus Companies and Suspicious Transactions
The FBR has filed 13 FIRs against fraudulent companies, including Bright Star, Moonlight, Asadullah Enterprises, and Smart Impex, all of which were found involved in over-invoicing schemes.
Senator Mohsin Aziz demanded further clarity from private banks that facilitated these transactions. The committee learned that fraudulent firms misused identity cards to deposit large sums under false pretenses. In one case, an individual who deposited Rs14 million later denied making the transaction, while another claimed he had never handled such a large amount in his life.
International Money Transfers Raise Red Flags
Investigators found that although the solar panels were imported from China, payments were illegally funneled to 10 different countries. Over Rs18 billion was transferred abroad, prompting calls for further scrutiny.
A private bank representative confirmed that Bright Star and Moonlight had engaged in multiple high-value transactions, including Rs185 million in cash deposits by Bright Star and Rs49 million by Moonlight. Consequently, the bank flagged these as suspicious transactions under money laundering laws.
Companies with Minimal Capital Handling Billions
One of the most alarming cases involved Smart Impex, which had a declared paid-up capital of only Rs2,000. Despite this, the company deposited Rs1.54 billion in cash, with total deposits reaching Rs3.39 billion.
Further Investigations Planned
The sub-committee scheduled additional inquiries in the upcoming meetings and expressed frustration over the SBP’s failure to provide essential financial data. However, SBP’s deputy governor assured the panel that all relevant records on solar imports would be made available in the next session.
