AS the judge informed Arif Naqvi that he had lost his extradition case, the founder of the once mighty Abraaj Group looked at the floor. It was difficult to tell how he had taken the news that he was a step closer to being extradited to the United States, where the 60-year-old faces a mountain of charges that, if proven, could send him to prison for the rest of his life. Masked up in a socially-distanced courtroom, Naqvi was silent for the short hearing. At the end, he raised his hand to thank the judge for her compassion despite the outcome, and for her recent elevation to the High Court.
“That’s him, a charmer,” remarked a journalist as we left the court. Prior to the collapse of Abraaj in 2018, the media and many of those who knew Naqvi lavished him with similar compliments. After all, Naqvi was the hero behind a private equity success story that boasted high returns on healthcare and education investments in emerging markets. At its peak, Abraaj had an investment portfolio of $13 billion and Naqvi was its posterboy.
The fund enticed big investors – including Bill Gates and the US government. They fantasised about driving growth, building opportunities, addressing inequality and plugging healthcare gaps in poor countries – with the convenience of making money.
A Davos regular who shared the stage with the likes of Richard Branson and Bill Gates, Naqvi was trusted in the billionaire boys club. His success, it appeared, was shatter-proof — until it wasn’t.
In 2017, the sun began to set on Abraaj. It was at this point that Naqvi’s story started to resemble a Greek tragedy. An ominous whistleblower email warned investors about a scandal and the imminent collapse of the company. It accused the group of overvaluing funds and manipulating profit and loss sheets. There were rumours that Abraaj was running out of cash and misusing healthcare funds to plug the shortfall. As investor confidence plummeted, the group was forced to return capital following months of demands. In 2018, Abraaj’s holding company filed for liquidation with reported debts of over $1bn.
Naqvi was arrested at Heathrow Airport in April 2019 after being charged in the US for securities fraud, wire fraud, money laundering and bribery.
Today, his life is a far cry from his 18-hour workday existence for which he lived on an aeroplane. He remains confined to his lofty apartment in South Kensington — the only property he now owns after having sold assets to post his GBP 15 million bail — with electronic monitoring and two-hour windows for outdoor walks. This home, often described in news reports as a ‘luxury gated block’, is his prison.
It is here that Mr Naqvi reflects on the rollercoaster ride of the past two years. The spectacular collapse raises many questions: was it hubris? Like Icarus, did pride come before the fall? Could it have been avoided? Despite his achievements, this dark period will eclipse Naqvi’s journey to the sun. In the extradition judgement, Justice Emma Aburthnot reviewed the evidence provided by two psychiatrists about Naqvi’s mental health. “I accepted the experts’ view that there is a real risk that he will attempt to commit suicide.”
“One psychiatrist reported that Naqvi had severe flashback experiences,” the judgement said, adding that evidence suggested he “experienced strong suicidal ideation” as well as “intermittent thoughts of not wanting to be alive”. It said that, while he is committed to the legal process, he remains “most pessimistic, at times even resigned”. He is humiliated and broken both financially and emotionally, it added.
The judgement featured more harrowing details. In June 2019, Naqvi lost 10 kilos in four weeks. In June 2020, Dr Cummings, a psychiatrist instructed by the US government, said that when Naqvi was asked what he would do if he were to be extradited to the US, he said “he was no longer going to put his family through this, that he neither had the money nor the resources to fight”. When pressed, he would not say more.
Last month, both Dr Cummings and the defence-appointed psychiatrist Dr Phelan found Naqvi to have deteriorated further. They described severe depressive episodes with psychotic symptoms — a position the judge accepted.
At the end, however, Justice Arbuthnot allowed his extradition.
Mr Naqvi denies wrongdoing, but his specific rebuttals to the charges will only be known once the trial begins. The superseding indictment presented by the US District Court outlines some serious crimes. From defrauding investors, enriching themselves at the expense of investors, causing hundreds of millions in losses to concealing the truth, the chargesheet is a dramatic narration of the Abraaj Group’s alleged wrongdoing.
For now, Naqvi has lost the first battle.
In a message shared after the court hearing, Mr Naqvi said: “..as only Allah knows, the judge said that the extradition must go ahead. So we lost this stage but Inshallah the appeal will be better. Everything happens on Allah’s will and time and I have complete faith that He will always choose the best path for me.”
In Pakistan, the country of his birth and heritage, Naqvi’s case has elicited a mixed reaction. Some are elated at the prospect that the US trial may “expose” his ties with the Pakistani political elite. Others express regret about the mark his tainted legacy will leave on Pakistani entrepreneurs trying to make it in the world.
There are also those who say Abraaj’s failed bid to sell K-Electric to Shanghai Electric Power — through which it would have offloaded 66 per cent of its share in the company to recover $450 million — was the most lethal blow.
Former prime minister Shahid Khaqan Abbasi, who was one of several stakeholders overseeing Abraaj’s K-Electric sale to the Shanghai group, said: “If Abraaj had been allowed to sell its shares in K-Electric to Shanghai, Arif would be a free man today. You tell me: a man who had deep contacts with the most powerful people in the country was unable to resolve administrative hurdles in the sale of his shares — a transaction which had no financial implications for Pakistan and that was hugely beneficial to the country. There is more here than meets the eye. How and why?”
Some speculate that the answer lies in America’s deep displeasure over China’s growing influence in Pakistan. It’s an intriguing question: in a country where everything is made possible for powerful men who knock on the right doors, why was this an impossible task? Did the Americans thwart the K-Electric deal? Even so, would it have saved Abraaj?
As he left the court in Marylebone, dejected after the hearing, Naqvi said to the group of reporters: “Don’t look so morose.”
Was he trying to muster a smile behind the mask? It was hard to say. Startled by his comment, I asked how he was feeling. “A-OK,” was his unconvincing reply.
Published in Dawn, February 1st, 2021