KARACHI: The Federal Investigation Agency’s (FIA) probe into a multi-million rupees scam involving the Employees’ Old-Age Benefits Institution (EOBI) and AKD Securities has suffered a major blow as after spending over two years on the exercise the FIA has admitted in a report that it could not find any evidence against the capital market giant, it emerged on Friday.

In their final report titled ‘False implication of AKD Securities in EOBI scandal” submitted to the FIA Sindh director, senior officials of the agency have come up with the conclusion that further efforts to establish the role of AKD Securities in the multi-million rupees scam would be a “futile exercise”.

In their findings, they mentioned an order of the Sindh High Court which had allowed an appeal of AKD Securities against the FIA action.

Federal probe body’s report says further efforts in multi-million scam will be a ‘futile exercise’

“The [FIA] committee has perused the relevant record and investigation file and heard complainant as well as investigation officers of the case,” said the FIA report. “It has transpired that no incrementing evidence seems to have been collected for application of Section 109 and 409 against the accused AKDS. In addition thereto, jurisdiction of FIA and SECP, relating to the role of AKDS, seems to be in conflict.”

The final report, which has been prepared by the FIA committee comprising its additional director corporate crime circle and additional director law, while referring to the ruling of the high court in favour of AKD Securities, has reached the conclusion that there is no use of reinvestigating the role of the brokerage house offices of which were raided more than two years ago to round up its senior management.

In January 2016, the FIA initiated an investigation against AKD Securities for allegedly causing a loss of more than Rs250 million to the national exchequer by allegedly manoeuvring with the EOBI. The FIA had claimed that the EOBI management acquired shares of a textile company, Amtex, worth Rs350m at around Rs19 per share in 2010 in violation of investment rules. It had said this all happened due to “manipulated research report” prepared by AKD Securities which had also its initial public offerings of Amtex. Years later, FIA blamed, the share price of the textile company nosedived to Rs2.5 per unit, causing a loss of Rs290m to the public organisation.

However, more than two years after the FIA action during which senior members of the AKD Securities’ management remained behind bars for months until they were awarded bails, the federal agency has finally come to the conclusion that the brokerage house had nothing to do with the infamous scam.

“In view of the foregoing, we are of the opinion that after above order where in the relevant lacunas, found out by this committee, have been thrashed out and the complainants have already been granted the required relief, the reinvestigation maybe a futile exercise,” said the report.

Immediately after the FIA action in January 2016, AKD Group chairman Aqeel Karim Dhedi had come with a strong reaction against the federal agency’s Sindh director, his business rival brokerage house and then secretary to the prime minister Fawad Hasan Fawad, accusing them of conspiring against his business group for personal reasons.

The National Accountability Bureau last month arrested Mr Fawad for his alleged involvement in the Rs14 billion Ashiana-i-Iqbal Housing Scheme scam.

When a senior FIA official, privy to the development, was asked about any authenticity the committee has found in the AKD chief’s claims during the course of its job after the brokerage house was given a clean chit, he did not respond directly to the query but only referred to the findings of the committee.

“The motive behind involving any business house in the probe is not clear, neither it was job of the committee to find this out. The report has been sent to the Sindh director with all facts of the probe and recommendations which suggest that it was not the right move,” he added.

Published in Dawn, August 18th, 2018