KARACHI: The Directorate of Post Clearance Audit (South), Karachi has uncovered another cartel of 12 fictitious importers embroiled in a web of illegal operations to facilitate the unauthorized clearance of goods including solar panels. This discovery comes as a result of an investigation into the activities of M/s Hamza Enterprises and its associated entities, shedding light on a staggering array of fraudulent practices and financial irregularities.
A scrutiny conducted on the directives of Director PCA Sheeraz Ahmed, found M/s Hamza Enterprises, a physically non-existent entity, clandestinely incorporated 11 suspected business names which already had their respective NTN / STRNs. M/s Hamza Enterprises added said 11 entities on its own NTN No. 5217810-6 to orchestrate an elaborate scheme aimed at maneuvering fraudulent clearances. These entities, together, have funneled import remittances exceeding Rs. 16 billion abroad, while wielding a surprisingly poor financial standing that raises questions about the legitimacy of their operations.
The illicit activities undertaken by this cartel include the creation of non-existent businesses, rampant misuse of the green channel, illegal clearance of solar panels and other goods, the utilization of illicit funds to finance imports, misappropriation of financial instruments, mis-invoicing, and the misuse of manufacturing status to evade duty and taxes. The overarching aim of these illicit activities was to hoodwink and manipulate customs procedures for fraudulent gains, ultimately leading to substantial losses for the national exchequer through duty and tax evasion, illicit financial flows, and trade-based money laundering.
The names of the 11 entities added to the NTN of M/s Hamza Enterprises have been revealed as: M/s Abid & Co, M/s Solar Sight (Pvt) Ltd, M/s International Trader, M/s Best Energy Solution, M/s KN Traders, M/s Zafar International, M/s Zafar Enterprises, M/s Pearl International, M/s Elahi Enterprises, M/s Ermi Fresh, and M/s Al Rehman Textiles. An FIR has been lodged and initial investigations have pointed to the active involvement of two individuals connected to Clearing Agency Paradise Associates, namely Moiz Baig and Faraz Ahmed Khan, as key players in facilitating this elaborate scheme.
Accused Moiz Baig has been arrested and customs court has allowed 7 days remand of the accused. Two PCA teams have been constituted to apprehend other accused and their accomplices whose collusion has allowed this cartel to operate with impunity, exploiting systemic vulnerabilities and orchestrating a massive fraud.
M/s Hamza Enterprises has been found involved in serious offences on account of physical non-existence, Misuse of green channel, Evasion of duty/taxes by misuse of manufacturing status to avail illegal exemptions involving Rs. 22.45 million in 50 GDs, use of Illicit funds involving Rs.1.62 billion in 678 GDs to finance imports not commensurate with financial worth, entailing TBML, Fraudulent clearance & attempt to clear solar panels on false / forged Financial Instrument (FI) by way of illegal use of open account involving Rs. 379.59 million, Fraudulent addition of various business names on the NTN / Customs User ID to clear solar panels illegally and deletion of business names from NTN / Customs User ID after illegal clearance of solar panels to hide the crime, obstruction to audit through non-production of records and violation of summon notice by non-appearance to substantiate genuineness of ownership. FIR has been lodged on violation of Sections 32A, 26A and 26B read with Sections 187 and 192 of the Customs Act 1969 punishable under clauses (12A), (12B), and (14A) of Section 156(1) of the Customs Act 1969.
Sources have reported that sectoral audit was initiated upon the directions of FBR, and so far, nine FIRs have been lodged by PCA South – exposing one peshwar-based cartel, one quetta-based cartel and now, one karachi-based cartel. PCA team, under the guidance and supervision of DG PCA Chaudary Zulfiqar Ali and Director PCA South, Sheeraz Ahmed, has successfully uncovered serious frauds in the solar panels sector leading to the lodging of FIRs which marks a significant development in the case. The authorities are actively pursuing further investigation into the matter to bring the culprits to justice and hold them accountable for their actions. With the full weight of the law bearing down on the perpetrators, it is clear that the authorities are determined to root out and prosecute all individuals complicit in this brazen affront to the integrity of the customs system and the nation’s fiscal well-being.