The Federal Investigation Agency (FIA) filed a case against Muttahida Qaumi Movement (MQM) founder Altaf Hussain on charges of terror financing and money laundering, DawnNews reported.

The case was filed on the complaint of businessman Sarfaraz Anwar Merchant in which he alleged that the funds received by the non-profit organisation Khidmat-e-Khalq Foundation (KKF) were transferred to the accounts of different MQM members and business organisations and were used to "purchase weapons of destruction, cash smuggling to United Kingdom (UK) for Hussain, terrorist activities in Pakistan and funds during election period".

FIA sources privy to this development say that the FIA had launched an inquiry after receiving Merchant's complaint and filed an FIR against Hussain under sections 11 (H), 11 (I) and 11 (J) of Anti-Terrorism act of 1997 and 121, 122, 123-A, 406, 468, 471, 477-A and 109 of Pakistan Penal Code read with 3 and 4 of Anti-Money Laundering Act of 2010.

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The complaint further states that Merchant found out the MQM was not registered in the UK as a political party after he was arrested by London's Metropolitan Police in 2013 over charges of money laundering. His arrest, Merchant claims, was in relation to an investigation that was being conducted into the funds held and controlled by the MQM. He alleges that the police had concluded at the time that the "cash and assets are believed to represent funds provided to MQM by the Indian government or [earned] through other unlawful activity".

In 2016, the British investigative agency Scotland Yard had dropped the money laundering case against the MQM-L leader due to insufficient evidence.

He adds that since MQM is registered as a political party in Pakistan, it is bound to declare its finances and the sources of its funds in accordance with the Election Commission of Pakistan's rules. However, the party has failed to do so, the letter says.

The complaint requests the FIA to impose a ban on MQM for being a "foreign aided political party, involved in misrepresentation of facts and money laundering".