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.”
