Pakistan’s ‘penniless billionaires’ expose money laundering frenzy

Pakistani auto-rickshaw driver Mohammad Rasheed drives his rickshaw in Qur’angi, a slum area in the eastern district of Karachi. (AFP)
Updated 28 October 2018

Pakistan’s ‘penniless billionaires’ expose money laundering frenzy

  • Bank accounts in poor residents’ names are flooded with cash, then suddenly emptied in a laundering scheme
  • Scale of these schemes is unprecedented, with authorities pointing the finger at some of Karachi’s wealthiest power brokers

KARACHI: It took rickshaw driver Mohammad Rasheed a year to save 300 rupees to buy his daughter a bike, so when he found three billion rupees ($22.5 million) had passed through an unused bank account in his name, he was stunned ... and scared.
“I started sweating and shivering,” said the 43-year-old — just the latest victim of a money laundering scheme that Pakistan’s new prime minister, Imran Khan, has vowed to crush.
When he got a call from the Federal Investigation Agency, Rasheed’s first inclination was to go into hiding, but friends and family members finally convinced him to cooperate with officials.
His case mirrors dozens of similar stories in recent weeks that have filled newspapers in Pakistan and riled a populace long accustomed to extravagant tales of corruption and theft.
The incidents follow a similar arc — bank accounts in poor residents’ names are flooded with cash, then suddenly emptied in a laundering scheme that has likely seen hundreds of millions of dollars moved out of the country.
Rasheed’s name was eventually cleared, but his anxiety remained.
“I stopped driving my rented rickshaw on the roads because of the fear that some other investigating agencies might pick me up,” he said.
“My wife fell sick because of the tension.”
Only weeks before the fiasco he had finally been able to buy a 300-rupee bike with worn tires for his daughter — the fruit of a year’s careful saving.




Pakistani auto-rickshaw driver Mohammad Rasheed plays with his daughter Nabeeha Rasheed in their home in Qur’angi, a slum area in eastern district of Karachi on Oct. 16, 2018. (AFP/File)

The revelation of the laundering frenzy comes as the newly elected Khan has vowed to squash rampant corruption and recover billions siphoned from the country as his government scrambles to shore up Pakistan’s deteriorating finances.
“This is your stolen money,” said the former cricketer during a televised address to the nation Wednesday.
“It was stolen on public contracts... and transferred into these accounts, then laundered abroad.
“I will spare no corrupt man in this country,” he promised.
But for victims like Mohammad Qadir the damage has already been done.
“I have never even seen a bank from the inside,” said the 52-year-old ice cream vendor.
Transactions were nevertheless made in his name for 2.25 billion rupees.
Since news of the incident spread Qadir says he is regularly mocked by his neighbors and also fears being kidnapped by criminal elements who believe he has billions of rupees to spare for hefty ransoms.
“He is a penniless billionaire,” one of Qadir’s acquaintances laughed while driving past his ice cream cart in the Karachi slum of Orangi town.
“People make fun of me, but I ended up with nothing at all from this situation,” said Qadir. “It is such a tragedy.”
Sarwat Zehra, a 56-year-old official, says she has suffered from high-blood pressure after being handed a bill for 13 million rupees in back taxes.
“I was told that a company had illegally passed 14 or 15 billion rupees through my account,” she said.
Pakistan’s poor have long been used as fronts for the elite to dodge taxes and hide assets.
But the scale of the bank account scheme is unprecedented, with authorities pointing the finger at some of Karachi’s wealthiest power brokers including figures with links to former president Asif Zardari.
In September, Pakistan’s Supreme Court established a commission to investigate the scourge, finding that at least 400 million dollars had passed through “thousands of false accounts,” using the names of impoverished people.
Some 600 companies and individuals “are associated with the scandal,” the commission concluded.
It is all the more embarrassing for Khan as his administration scrambles to secure billions of dollars in foreign financial assistance, while also entering talks with the International Monetary Fund for a potential bailout amid a widening balance of payment crisis.
The brazen laundering schemes come as Pakistan was again placed on a watchlist this year by the Financial Action Task Force (FATF) — an anti money-laundering monitor based in Paris — for failing to do enough to combat terror financing.


India starts world’s largest COVID-19 vaccination drive

Updated 10 min 1 sec ago

India starts world’s largest COVID-19 vaccination drive

  • India is home to the world’s largest vaccine makers and has one of the biggest immunization programs
  • But there is no playbook for the enormity of the current challenge

NEW DELHI: India started inoculating health workers Saturday in what is likely the world’s largest COVID-19 vaccination campaign, joining the ranks of wealthier nations where the effort is already well underway.
India is home to the world’s largest vaccine makers and has one of the biggest immunization programs. But there is no playbook for the enormity of the current challenge.
Indian authorities hope to give shots to 300 million people, roughly the population of the USand several times more than its existing program that targets 26 million infants. The recipients include 30 million doctors, nurses and other front-line workers, to be followed by 270 million people who are either over 50 years old or have illnesses that make them vulnerable to COVID-19.
For workers who have pulled India’s battered health care system through the pandemic, the shots offered confidence that life can start returning to normal. Many burst with pride.
“I am excited that I am among the first to get the vaccine,” Gita Devi, a nurse, said as she lifted her left sleeve to receive the shot.
“I am happy to get an India-made vaccine and that we do not have to depend on others for it,” said Devi, who has treated patients throughout the pandemic in a hospital in Lucknow, the capital of Uttar Pradesh state in India’s heartland.
The first dose was administered to a sanitation worker at the All Indian Institute of Medical Sciences in the capital, New Delhi, after Prime Minister Narendra Modi kickstarted the campaign with a nationally televised speech.
“We are launching the world’s biggest vaccination drive and it shows the world our capability,” Modi said. He implored citizens to keep their guard up and not to believe any “rumors about the safety of the vaccines.”
It was not clear whether Modi, 70, had received the vaccine himself like other world leaders to try to demonstrate the shot’s safety. His government has said politicians will not be considered priority groups in the first phase of the rollout.
Health officials haven’t specified what percentage of India’s nearly 1.4 billion people will be targeted by the campaign. But experts say it will almost certainly be the largest such drive globally.
The sheer scale has its obstacles and some early snags were identified. For instance, there were delays in uploading the details of health care workers receiving the shots to a digital platform that India is using to track vaccines, the Health Ministry said.
Shots were given to at least 165,714 people on Saturday, Dr. Manohar Agnani, a Health Ministry official, said at an evening briefing. The ministry had said that it was aiming to vaccinate 100 people in each of the 3,006 centers across the country.
News cameras captured the injections across hundreds of hospitals, underscoring the pent-up hopes that vaccination was the first step in getting past the pandemic that has devastated the lives of so many Indians and bruised the country’s economy.
India on Jan. 4 approved emergency use of two vaccines, one developed by Oxford University and UK-based drugmaker AstraZeneca, and another by Indian company Bharat Biotech. Cargo planes flew 16.5 million shots to different Indian cities last week.
But doubts over the effectiveness of the homegrown vaccine is creating hurdles for the ambitious plan.
Health experts worry that the regulatory shortcut taken to approve the Bharat Biotech vaccine without waiting for concrete data that would show its efficacy in preventing illness from the coronavirus could amplify vaccine hesitancy. At least one state health minister has opposed its use.
In New Delhi, doctors at Ram Manohar Lohia Hospital, one of the largest in the city, demanded they be administered the AstraZeneca vaccine instead of the one developed by Bharat Biotech. A doctors union at the hospital said many of its members were a “bit apprehensive about the lack of complete trial” for the homegrown vaccine.
“Right now, we don’t have the option to choose between the vaccines,” said Dr. Nirmalaya Mohapatra, vice president of the hospital’s Resident Doctors Association.
The Health Ministry has bristled at the criticism and says the vaccines are safe, but maintains that health workers will have no choice in deciding which vaccine they will get themselves.
According to Dr. S.P. Kalantri, the director of a rural hospital in Maharashtra, India’s worst-hit state, such an approach was worrying because he said the regulatory approval was hasty and not backed by science.
“In a hurry to be populist, the government (is) taking decisions that might not be in the best interest of the common man,” Kalantri said.
Against the backdrop of the rising global COVID-19 death toll — it topped 2 million on Friday — the clock is ticking to vaccinate as many people as possible. But the campaign has been uneven.
In wealthy countries including the United States, Britain, Israel, Canada and Germany, millions of citizens have already been given some measure of protection by vaccines developed with revolutionary speed and quickly authorized for use.
But elsewhere, immunization drives have barely gotten off the ground. Many experts are predicting another year of loss and hardship in places like Iran, India, Mexico and Brazil, which together account for about a quarter of the world’s COVID-19 deaths.
India is second to the US with more than 10.5 million confirmed cases, and ranks third in the number of deaths, behind the US and Brazil, with over 152,000.
More than 35 million doses of various COVID-19 vaccines have been administered around the world, according to the University of Oxford.
While the majority of the COVID-19 vaccine doses have already been snapped up by wealthy countries, COVAX, a UN-backed project to supply shots to developing parts of the world, has found itself short of vaccines, money and logistical help.
As a result, the World Health Organization’s chief scientist, Dr. Soumya Swaminathan, warned this week that it is highly unlikely that herd immunity — which would require at least 70% of the globe to be vaccinated — will be achieved this year.
“Even if it happens in a couple of pockets, in a few countries, it’s not going to protect people across the world,” she said.