LAHORE, March 15: The Federal Investigation Agency (FIA) detected a fraud of Rs26 million in the Pakistan Mint allegedly committed by the mint master, works manager and deputy secretary.

The FIA launched the probe on the orders of the Lahore High Court which was approached by the lowest bidder for the supply of 200 metric tons of copper and 100 metric tons of nickel.

The FIA has forwarded the case to the interior ministry, seeking permission to register a case against the three officers. A three-member FIA inquiry committee had initiated the probe in 2003 into the purchase of copper and nickel on higher rates in 2001-02.

It, however, held Mint Master Riaz Hasan Khan, works manager Raja Fayyaz Anwar and deputy secretary Muhammad Younis responsible for causing Rs26 million loss to the public exchequer in connivance with a local supplier company. It also recommended action against the chief executive of the company on tax evasion charges.

The National Accountability Bureau (NAB) is also holding an inquiry against the Pakistan Mint master for purchasing different items like chiller, zinc ingots, gas generator, wire mesh, conveyer belt, pyrometer and over looking machine on higher rates during 2001-03.

According to the FIA inquiry report made available to Dawn on Monday, the Pakistan Mint opened bids in October 2001 for the supply of 200MT copper and 100MT nickel. Four firms participated in the bid.

Riaz Ahmad Khan, who was the acting mint master, rejected the lowest bid in order to facilitate the supplier company get the contract at higher rates. The FIA report claimed that Riaz Khan had taken Rs5.5 million to award the contract to the company which had nothing to do with the metal business.

It said the accused also issued the purchase orders to the company contrary to the quantity quoted in the tender. The report said the Pakistan Mint did not require the metals as it had already 718MT copper and 214MT nickel in its stock. The mint master deliberately concealed this fact and did not consult the department concerned which was supposed to give a procurement advice, it added.

Similarly in July 2001, he also violated rules and regulation and awarded a tender for the supply of 300MT copper to the same company instead of issuing purchase order to the lowest bidder.

The report said the mint master was bound to compare the offered prices against the metal with the London Market Exchange but he did not. The prices of the metal all over the world were based on the LME prices, it said.

Besides, the metal provided by the suppliers was not up to the standard and it was confirmed by the University of Engineering and Technology (UET).

COINS: The FIA inquiry team also found that the mint master violated rules and regulations in delivering coins to the State Bank of Pakistan. According to the rules and regulations, the coins delivered to the SBP should be in number and weight. Whereas the mint master was delivering them in less weight but right number.