Pakistan’s Federal Board of Revenue (FBR) has unearthed a colossal money laundering and trade under-invoicing case, marking one of the nation’s most significant financial scandals to date.
After a meticulous audit investigation, the FBR initiated legal proceedings against two Peshawar-based companies implicated in an astounding money laundering scheme valued at Rs47 billion, officially termed “trade-based money laundering.”
The FBR’s report asserts that these companies, ostensibly dealing in solar panels, engaged in substantial under-invoicing, causing a staggering Rs25 billion loss to the national exchequer.
The owners of these entities, Moon Light Traders and Bright Star, were named as suspects in the First Information Report (FIR). The audit revealed that Bright Star had been involved in under-invoicing since 2013, while auditors scrutinized records encompassing 705 Goods Declarations (GDs) related to Moon Light Traders.
It was further uncovered that these companies continued their money laundering activities from 2017 to 2022. The FBR promptly shared its findings on trade-based money laundering and under-invoicing with Caretaker Prime Minister Anwaarul Haq Kakar, according to ARY News.
In a separate September incident, the FBR exposed a massive tax fraud worth Rs314 billion orchestrated by a fictitious entity known as K H & Sons. The discovery was made by the Director-General of Internal Audit at Inland Revenue’s team.
Notably, K H & Sons operated as a shell company registered under the name of a Benami individual, Muhammad Kashif. Their falsified documents claimed involvement in the iron and steel sector, using addresses of legitimate markets such as Liaquat Market, Agri Market, and M.A. Jinnah Market.
Sources indicated that this fraudulent company was implicated in various illegal activities. Concerns arose as the FBR had not taken legal action against the culprits despite the extensive tax fraud, raising the possibility of them fleeing the country if a First Information Report (FIR) was not promptly filed.
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