MULTAN: The Directorate of Customs Intelligence and Investigation (CII) of the Federal Board of Revenue has asked the Chinese Department of International Cooperation, General Administration of Customs, to provide them the details of the record in connection with suspected money laundering, majorly shipments for a Multan-based company, Dawn has learnt.

CII Regional Office Karachi’s Director Irfan Javed wrote to the Chinese’s authorities on July 18 and also sent the representative samples of the item/product, stating that the credible information was received that M/s SM Food Makers Ltd Multan (NTN-3970637) with the active connivance and association of M/s Chaozhou Haiye Packaging and Printing Factory, M/s Quangdong Danqing Printing Co Ltd and the M/s Shan Tou Zhongyi Color Printing Factory (all three manufacturers) located in Shantou city of Guangdong province besides China based various traders, are involved in the import and clearance of pouches with the printed logo of ‘Koko Masti, MS Food Maters, 01 KM New Central Jail Road, Multan, Pakistan’ by way of mis-declaration/concealment of actual transaction value and suspected money laundering.

“Pakistani nationals Tanveer Butt and Hanif Muhammad Qasim have established trading/exporting companies in the name of M/s Shenzhen Fengyu Import and Export Co Ltd, Shenzhen, China and M/s Shenzhen Honghai Cheng Trading Co Ltd, China, maintaining their business RBM (Chinese currency Ren Min Bi) Account Nos 6222032003000685495 and 622083602006234261 at ICBC (Industrial Commercial Bank of China). M/s Food Makers Ltd Multan and others place their purchase orders directly to manufacturers for empty packing material while funds involved in such purchases are remitted/transferred by Pakistan-based importers in above referred two accounts through ‘hawala/hundi’ (fast money transfer, an unauthorized illegal channel). Thereafter the local traders/shippers transfer/remit the amount in local currency onwards to the manufacturer through banking channel.

The manufacturer in return delivers consignment of packing material (empty pouches) to the local traders against issuance of commercial invoices showing therein actual transaction value at RBM Y 0.055/pc. The photocopy of actual invoice dated August 8, 2018 issued by M/s Chaozhou Haiye Packaging and Printing Factory (manufacturer) in favor of M/s Kokos International Corporation Karachi for sale of 3.56 million pieces of Koko Mast Chocolate spout pouch at RMB Y 0.055/pc (equivalent to $4/kg) is enclosed for ready reference. The local traders/exporters, however instead of making shipments against actual transaction value in term of commercial invoices issued by manufactures, generate their own manipulated commercial invoices wherein the transaction value of the product, shipped either to M/s SM Foods Multan their other sister concern or any associate importer is (mis)declared as $0.7/kg to $0.8/kg photocopies of manipulated invoices generated by local traders concealing therein actual transaction value are enclosed,” Mr Javed stated.

He stated M/s Shenzhen Fengyu Import and Export Co Ltd exports/ships consignments of empty packing material to M/s Kashmir Toys, Rawalpindi, and M/s SM Food Makers Ltd, Multan, whereas M/s Shenzhen Honghai Cheng Trading Co Ltd ships the consignment directly to M/s SM Foods Makers Ltd, Multan, and its sister concerns namely M/s Volka Food and M/s Kokos International in Pakistan.

“However in order to conceal the voyage trail as well as names of shipper, China-based traders surrender master bill of landing along with relevant shipping documents to M/s Allstar Shipping LLC, Dubai, which prepares fresh bills of landing as well as commercial invoices showing therein M/s Wittvolk Europe International General Trading LLC, 214J, The Square, Al Mamzar, Dubai, UAE as shipper,” he stated.

He stated that during the course of investigation it has been found that M/s Shenzhen Fengyu Import and Export Co Ltd, M/s Shenzhen Honghai Cheng Trading Co Ltd and five other local traders/shippers during the period from July 2015 to April 2019 have shipped a total of 86 consignments of packing material (plastic pouches) to Pakistan against manipulated invoices at $1/kg out of which 57 consignments were done by Shenzhen Honghaicheng Trading Co Ltd, 12 by Zohra and Sons Co Ltd, eight by Shenzhen Fengyu Import and Export Co Ltd, four by Winco Logistics Co Ltd, three by Ample Trading and one each by Chaozhou Haiye Packaging and Printing Factory and Guangdong Motian Foodstuff Co Ltd.

He stated that since the investigation into the matter are under invoicing and suspecting money laundering is underway, the matter should be taken directly with the Chinese customs authorities.

Published in Dawn, August 21st, 2019