Dr Shoaib Suddle, Federal Tax Ombudsman - File Photo

Q. You began your investigations as an inquiry into the missing containers carrying goods meant for International Security Assistance Force in Afghanistan (Isaf) but ended up writing about the Afghan transit trade…

A. As mentioned in the Federal Tax Ombudsman’s (FTO) report, “Isaf Container Scam” is a misnomer. During investigations this actually became “Lunar Container Scam” – involving 52 liquor containers “smuggled” into Pakistan by M/s Lunar Products, Afghanistan, under genuine recommendatory letters by the Afghan Consulate General in Karachi which in turn were issued on the basis of fake Isaf letters. It soon became evident that the conclusive evidence was unavailable to prove that Isaf/Nato had anything to do with the scam. It was, however, apparent that the name of Isaf was fraudulently used to “smuggle” goods into Pakistan. It was in this background that the scope of FTO investigations was extended to include Afghan transit trade containers.

Q. There are reports that more containers are missing than you mentioned in your report…

A. The FTO report was an interim report based on certain conservative assumptions applied to information available at the time. Due to our approach that the investigation must be factual rather than accusatory, we were extremely cautious in arriving at the number of Afghan transit trade containers involved in the scam. The report, however, did state that the conservative estimate of 7,922 containers could be just the “tip of the ice berg”. We can now say, based on the latest available record, that the number of containers involved in the scam was not less than 11,000. The lower figure of 7,922 was derived after excluding the cargo that was apparently meant for Quetta and Peshawar. But after comparing the cargo details mentioned in each bill of lading, it became clear that most containers meant for Quetta and Peshawar were, in fact, Afghan transit trade containers.

Q. Did your office ever check with the Afghan authorities if they had received these containers?

A. We did make efforts for seeking relevant data from Afghan authorities but, despite reminders, they never responded.

Q. Were these missing containers actually imported for Afghanistan or were they brought into Pakistan on fake documents?

A. The fact that most containers were imported for Afghanistan is evident from bills of lading, showing the address of the importer in Afghanistan.

Q. Some people say that your estimate of the missing containers having caused 19 billion rupee loss to the exchequer is based on assumptions because no details are available about the goods carried by the missing containers…

A. Our initial estimates were on the conservative side but we are now in the possession of more information and as such our estimates need upward revision. We now know what cargo was imported in each container. The exercise is not complete yet but initial results indicate that our estimation of pilferage is actually going to be significantly higher, based on the data of goods actually imported.

Q. Has there been any progress in criminal investigations being conducted by the Federal Board of Revenue (FBR) into the scam?

A. The FBR has begun the process. While conducting disciplinary/criminal investigations is mainly the FBR’s responsibility, reported knee-jerk steps such as placing 600 officials on exit control list, starting inquiries into their assets or placing a large number of them under suspension are seemingly counterproductive and may only lead to creating an environment of fear and mistrust. This approach is also exacerbating the widely-held impression of a witch-hunt and eroding the credibility of a fair, just and transparent investigative process. It is feared that the few people who are actually responsible for the scam will be able to hide within the crowd and escape. By accusing everybody whether guilty or innocent, it will be impossible to bring the real culprits to book. It is, therefore, crucial that criminal investigation be focused only on those against whom there is sufficient and provable evidence.

Q. Have all the suspect officials listed in your report been removed from their posts?

A. The FTO report did not name any official for possible involvement in the scam. This was done intentionally. We did not have enough time to conclude the investigation, and naming people without giving them adequate opportunity of hearing would have been not only unfair but also unprofessional. We wanted to be completely sure that sufficient evidence that could withstand hostile scrutiny in a court of law was available with us before initiating legal action against the culprits.

The interview was conducted by email