Eight arrested as part of wide-scale crackdown against smuggling of dollars from Pakistan

KARACHI: The Federal Investigation Agency (FIA) has arrested eight people from foreign exchange companies in Sindh as part of an announced crackdown against the smuggling and hoarding of dollars.
The development comes after the US dollar last week reached a historic high of Rs170.96, prompting the State Bank of Pakistan to announce curbs to stop the “undesirable” flow of foreign currency out of Pakistan and enhance transparency in foreign currency transactions by exchange companies.
On Monday, Pakistani Interior Minister Sheikh Rashid Ahmed said the government would audit five major foreign exchange companies to check the flight of US dollars and had arrested dozens of individuals for their alleged involvement in hoarding the greenback.
“The FIA’s commercial banking circle has arrested eight people, six of them staff members of the Bestway Exchange Company, during a raid on the company’s offices in Karachi,” a spokesperson for the FIA told Arab News on Tuesday, saying the company was using hundi and hawala, informal trust-based money transfer networks that are usually run by unlicensed financial brokers.
He said two of the people detained were cash carriers who would take the currency to the southwestern Balochistan province for onwards smuggling to Afghanistan. Around 7.6 million in Pakistani rupees, $36,394 and other foreign currency worth Rs3 million were seized from their custody as were mobile phones, laptops and other documents being used for illegal money transfers abroad.
“They were illegally providing US dollars to residents of Balochistan without any receipt or entry,” the FIA said in a statement.
Under new rules for exchange companies announced last week, people traveling to Afghanistan will be allowed to carry only $1,000 per person per visit, with a maximum annual limit of $6,000. Exchange companies will be required to conduct biometric verification for all foreign currency sale transactions equivalent to $500 and above and outward remittances, effective from October 22, 2021.
Exchange companies have also been asked to sell foreign currency in cash and make outward remittances equivalent to $10,000 and above against receipt of funds through cheque or banking channels only.