Corruption of 118 billion found in Pakistan

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Post under PTI Minister for Communications Murad Saeed

By Shamim Mehmood

A corruption of 118 billion of rupees in digitization of Pakistan Post has been reported, Public Accounts Committee (PAC) ordered thorough investigations to submit the report. Sources said that the federal investigation agencies have completed the task and will submit the report very soon. Additional Director General (Financial Services) Ijaz Ahmed Minhas with other officials are reportedly found involve. When contacted, Ijaz Minhas denied the allegations and declared the report fabricated.

A financial scam of worth 118 billion of rupees has surfaced in the Pakistan Post into a contract with Habib Bank Ltd for digitalization of financial services of around 12000 post offices across the country. Allegations in award of contract for Digitalization of financial services to HBL in violation of Public Procurement Rules (PPRA) and other government financial rules. A reliable source mentioned that the investigation agencies found the solid evidences that the Additional DG (FS)/ Acting DG with support of his allies made every possible effort to pave way for engaging HBL for illegal financial gains. The evidences of involvement of minister were also found for ulterior motives.

According to the details, in 2018, the then Secretary Mr. Saqib Aziz launched a project for extension of SAP Enterprise Resources Planning (ERP) solution for digitization of manual accounting system of Pakistan Post for accurate and real time reporting of data to AGPR, Finance etc. The case was forwarded by then Director General Muhammad Ikhlaq Rana to the ministry of Communications (MOC) but the Ministry didn’t forward the case on the plea that Ministry will not incur expenditure from government kitty on this project. So, Pakistan Post went to look for other options.

In a bid to digitalize the post offices across the country Korean Bank after comprehensive consultancy agreed to provide soft loan of 23 million dollars. The move was to offer complete hardware and software digitized solutions for revamping the postal system in a holistic way. The repayment period was 30 years with grace period of ten years on minimal rate of less than one percent which was expected to be converted into grant.

This project was approved by Economic Affair Division (EAD) but controlling Ministry intentionally turned down the loan to pave way for HBL. The Additional DG(FS), Ijaz Ahmad Minhas un-authorizedly wrote a letter(without the approval of DG Pakistan Post) that loan is not required for digitalization of Pakistan Post. Both aforementioned projects were turned down on the pretext of non-incurring government expenditure but ground realities clearly show that every effort was being made to pave the way to engage HBL for ulterior motives.

Consequently, expression of interest was published in the newspapers and different banks shown their interest but HBL was selected and agreement was executed on 3rd June, 2020 by Additional DG (FS) Mr. Ijaz Minhas. For execution of contract, Operational and Accounting procedure committees were constituted but copy of the agreement was not provided. Later the copy of the agreement was presented on the intervention of DG Ikhlaq Rana and found that it is altered/changed after vetting from Law Division.

The vetted and signed agreement were different. This was unlawful and glaring misconduct. DG Post referred the matter to controlling Ministry with the request to conduct fact finding inquiry. The controlling Ministry directed DG Post to hold inquiry to fix responsibility for these illegal changes in the agreement. Resultantly, the DG constituted a fact finding inquiry committee comprising 3 senior officers of the department to probe into the matter in detail and fix the responsibility.

The inquiry committee proved that Mr. Ijaz Ahmad Minhas Additional DG (FS) is solely responsible for unlawful alterations in the agreement being sole architect of agreement and spokesman of the department was directly in contact with HBL authorities. On the recommendation of inquiry committee DG Post Ikhlaq Rana submitted inquiry report to the Ministry but no action was taken against the accused by the ministry. Charge-sheet and statement of allegations are still lying pending in MOC to protect the culprit.

It is further learnt that proposals from government entities like NBP and NITB Consortium to meet the FATF compliance were also not accepted by ministry to favour the HBL. In a meeting held on January, 11 in the office of Secretary Communications Zafar Hassan not only insulted DG Ikhlaq Rana but also threatened to remove him from office and face dire consequences. DG Ikhlaq Rana took a principle stand against the Secretary for his rude and insulting behaviour in presence of subordinate officers in the meeting.

So he requested through a letter on the same day that he may be allowed to go on leave till date of retirement or be allowed premature retirement and for execution of HBL agreement Ijaz Minhas, Additional DG(FS) be appointed as Project Director, Ikhlaq Rana further wrote that he will not attend any meeting in ministry in this regard. Federal Minister Murad Saeed and Secretary Communications took it as an opportunity and minister granted 81 days leave to Ikhlaq Rana till his retirement and look after charge of DG Post was given to Mr. Ijaz Minhas Additional DG (FS).

The main hurdle in execution of PPOD-HBL agreement was removed. This whole scenario creates high suspicions on the part of Ministry of Communications. From the whole proceedings it transpired that alterations/amendments were made in the agreement in order to give favor to HBL by providing deposits in the shape of saving bank and military pension payment to the tune of about 1100 billion (Rs 500 billion Savings Bank principal plus interest on deposit and Rs 600 billion military pension). On this 1100 billion HBL could have earned 0.5 percent float from State Bank of Pakistan (SBP) which comes to Rs 25-35 billion annually without doing banking business.

Now question arises why all this undue favor was being extended to HBL? Reportedly HBL gave Rs 7 billion to Federal Minister Murad Saeed, Federal Secretary Zafar Hassan, and former Secretary Communications, Jawad Raffiq Malik and Additional DG(FS) Ijaz Minhas and peanuts will go the subordinates.

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