80 companies involved in PKR 106 billion solar import scam: Pakistan tax authority

Officials of the Federal Board of Revenue — Pakistan's tax collection authority — have identified 80 companies that were involved in the PKR 106 billion money laundering scam conducted under the guise of solar panels' imports.

While they imported solar panels from China, they paid billions over the actual cost, and not only transferred the money to China but sent around PKR 18 billion to 10 other countries as well.

Of these, 63 companies were involved in over-invoicing. A dummy company was also used.

FBR officials shared with the Senate Subcommittee on Finance and Revenue chaired by Senator Mohsin Aziz that the owner of one particular company involved in the import of solar panels falsely portrayed himself as a salaried individual in official documents.

The company — identified as a dummy entity — imported solar panels worth around PKR 2.29 billion. It was also reported that this same company showed sales of solar panels amounting to more than PKR 2.58 billion.

FIRs filed against over-invoicing

As a result of the investigation, the FBR has filed 13 first information reports (FIRs) against the implicated companies, including Bright Star, Moonlight, Asadullah Enterprises, and Smart Impex.

The committee was also informed that Bright Star, a company heavily implicated in the issue, falsely claimed to have imported solar panels at high rates and sold them at lower rates in local market. FBR officials emphasized that Bright Star was a fake and bogus company involved in fraudulent solar import activities.

Suspicious transactions in banks

Senator Mohsin Aziz demanded further clarification from Bank Alfalah on the solar import transactions of these companies, calling for transparency on the amounts transferred and the nature of their business activities.

FBR officials also disclosed alarming information about the misuse of identity cards. Several individuals were found to have deposited large sums of money under false pretenses. One individual had deposited PKR 14 million in a bank but later denied the transaction, while another claimed he had never seen such a large amount in his life.

Representatives from Faysal Bank testified that Bright Star and Moonlight had made multiple transactions involving large sums. Bright Star had four transactions totaling PKR 185 million, all of which were cash deposits.

Additionally, Moonlight had two transactions worth PKR 49 million. The bank officials stated they had issued a Suspicious Transaction Report on these transactions.

Meanwhile, Smart Impex, another company under investigation, was reported to have a paid up capital of only PKR 2,000. Despite this, the company deposited over PKR 1.54 billion in cash, with total deposits amounting to PKR 3.39 billion.

State Bank's role

Senator Aziz raised concerns about the State Bank's failure to provide the necessary information on the solar import scandal.

However, its deputy governor assured the committee that all data related to solar imports would be collected and presented in the next meeting.

Senator Aziz vowed to continue investigating the full extent of the scandal and ensure that all those responsible for the fraudulent activities were held accountable.

The committee decided to do further inquiry in the next committee meeting.