Court sentences three men to five years in prison amid Pakistan crackdown on illegal currency trade

A man speaks with a currency dealer, at a foreign exchange shop, in Peshawar, Pakistan September 8, 2023. (Reuters/File)
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Updated 08 August 2025
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Court sentences three men to five years in prison amid Pakistan crackdown on illegal currency trade

  • The crackdown was prompted by a slide in worth of rupee, which fell to a 22-month low of Rs284.97 against the US dollar last month
  • Burdened by over $58 billion in imports in last fiscal year, Pakistan faces severe inflationary pressure whenever greenback strengthens

ISLAMABAD: A Pakistani court has sentenced three men each to five years in prison for running an illegal currency exchange, the Federal Investigation Agency said on Friday, amid a widening crackdown on illegal currency trade.

Pakistan authorities have been cracking down on currency smugglers and illegal exchanges since a depreciation in worth of rupee, which fell to a 22-month low of Rs284.97 against the US dollar last month and raised widespread concerns.

The crackdown followed a meeting of Maj. Gen. Faisal Naseer, an official of the Inter-Services Intelligence (ISI), Pakistan’s powerful military-run spy agency, with exchange company representatives in Islamabad on July 22.

On Friday, a local court in the southern Pakistani district of Sukkur sentenced three accused, Qamar Shahzad, Muhammad Zeeshan and Zubair Asghar, to five years in prison and imposed a fine of Rs1 million ($3,517) on each, according to the FIA.

“The accused were found involved in illegal currency exchange,” the FIA said, adding it had seized Rs1 million, $20,700 and 147,000 Saudi riyals from the accused persons.

“The court has ordered the deposit of the recovered currency in national kitty.”

Pakistan operates a multi-tiered currency market, with rates diverging between the official interbank channel, the open market, and an unregulated “grey market” where many traders and informal hawala dealers operate.

Burdened by over $58 billion in imports in the last fiscal year, Pakistan faces severe inflationary pressure whenever the dollar strengthens. The rupee has lost 2 percent of its value between January and July this year, despite Pakistan’s current account recording a surplus of $2.1 billion, according to central bank data.

On July 27, the FIA said it had arrested five suspects involved in illegal currency exchange and transfer of money in the southwestern Balochistan province that borders Iran and Afghanistan.

Officials seized 684,000 Pakistani rupees, 230.5 million Iranian rials, more than 135,000 Afghanis, 700 US dollars, 200 Saudi riyals and 150 Australian dollars during raids in Balochistan’s Quetta and Chaman.

“Cheque books, hawala-hundi receipts and bank deposit slips were also recovered from the suspects,” the FIA said.

“The suspects were involved in currency exchange without a license. They could not give a satisfactory answer to the authorities regarding the recovered currency.”


Pakistan says it is targeting militant infrastructure in Afghanistan as Kabul threatens to hit Islamabad

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Pakistan says it is targeting militant infrastructure in Afghanistan as Kabul threatens to hit Islamabad

  • Ata Tarar says Pakistan is carrying out ‘precise intelligence-based operations’ to avoid civilian casualties
  • Afghan defense minister says the underlying dispute between the two sides is over the ‘Durand Line’ border

ISLAMABAD: Pakistan said on Saturday it was conducting intelligence-based operations against militant infrastructure inside Afghanistan while attempting to avoid civilian casualties, as a senior Afghan Taliban official warned Kabul could retaliate by targeting Islamabad if Pakistani forces struck the Afghan capital.

The escalating rhetoric comes as cross-border fighting between the two neighbors intensifies following clashes that began last month when Afghan forces launched attacks on Pakistani military installations along the frontier. Kabul said the assault was retaliation for Pakistani airstrikes targeting what Islamabad called militant camps inside Afghanistan.

Pakistan’s defense minister Khawaja Muhammad Asif said last week the situation had effectively become “open war” between the two countries.

“Pakistan is only targeting terrorist infrastructures and support system with precise intelligence based operations ensuring no collateral damage takes place,” Pakistan’s Information Minister Ataullah Tarar said in a statement.

He challenged the recent claims made by an Afghan defense ministry spokesperson earlier this week who said his country was making significant battlefield gains against Pakistan including the killing of 109 soldiers and the capture or destruction of 14 military posts in large scale attacks.

“These so called attacks by Afghan Taliban in coordination with FAK [Fitna Al Khawarij] Terrorists once again confirm the nexus of Afghan Taliban regime and multiple terrorist organizations operating from within their territory,” Tarar continued. “All such attempts are responded to, immediately and effectively with severe retributive punishment that is swift, precise and effective.”

“The imaginary numbers being floated by Afghan Taliban regime are however not worth any serious comment,” he added.

Tarar said Pakistan’s military campaign — described as Operation Ghazb Lil Haq — had inflicted heavy losses on Afghan Taliban forces.

According to figures shared by the minister, 527 Taliban fighters had been killed and more than 755 injured since the clashes began, while 237 check posts were destroyed and 38 captured and destroyed. He said 205 tanks, armored vehicles and artillery guns were destroyed and 62 locations across Afghanistan had been targeted by air strikes.

Arab News could not independently verify the claims made by either side.

CIVILIAN CASUALTIES

Earlier this week, the United Nations raised concern over the toll of the escalating conflict on civilians.

UN human rights chief Volker Turk said on Friday that 56 Afghan civilians — nearly half of them children — had been killed since hostilities between Pakistan and Afghanistan intensified.

However, Tarar questioned the UN findings, saying its assertions appeared to rely heavily on information provided by Taliban authorities and did not adequately reflect independently verified intelligence.

“Pakistan categorically reiterates that all counter-terrorism operations conducted by its security forces are carried out with the highest degree of precision, professionalism, and responsibility,” he said.

Islamabad has long accused the Taliban government of allowing militant groups, including the Tehreek-e-Taliban Pakistan (TTP), to operate from Afghan soil, a charge Kabul denies.

“Operations are meticulously planned so that civilian areas remain completely safe,” the minister said. “The locations targeted are remote terrorist hideouts and facilities far removed from populated zones, including sensitive areas such as Kabul’s Green Zone.”

AFGHAN WARNING

Meanwhile, Afghanistan’s Defense Minister Mullah Yaqoob issued a warning to Pakistan in remarks circulated by Afghan broadcaster TOLOnews.

“If Kabul lacks peace, there will be no peace in Islamabad. If Kabul is attacked, Islamabad will be attacked,” Yaqoob said in a promotional clip of an interview shared on social media.

Yaqoob rejected Pakistan’s justification that the presence of the TTP in Afghanistan warranted military action and suggested the underlying dispute was over the contested “Durand Line” border between the two countries.

So far, there has been no official response from Pakistan to Yaqoob’s remarks.