Pakistan’s biggest money laundering, under-invoicing scandal unearthed

The Federal Board of Revenue (FBR) has unearthed the biggest ‘trade-based’ money laundering and under-invoicing scandal in Pakistan, ARY News reported on Thursday.

The Federal Board of Revenue (FBR) lodged a case against two companies in Peshawar after unearthing a massive money laundering worth Rs47 billion following a thorough investigation by the auditors.

According to FBR’s report, the transfer of money was declared a ‘trade-based money laundering’.

The report stated that the companies caused a mammoth financial loss to the national exchequer worth Rs25 billion allegedly through under-invoicing. The money laundering and under-invoicing were committed in the name of solar panels.

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In the First Information Report (FIR), owners of two companies, Moon Light Traders and Bright Star, were nominated. The FBR report stated that the Bright Star Company was involved in under-invoicing in the GD in 2013, whereas, auditors caught the records of 705 GDs of the Moon Light Traders.

It also revealed that the companies continued laundering money from 2017 to 2022. The trade-based money laundering and under-invoicing report was also forwarded to the Caretaker Prime Minister (PM) Anwaarul Haq Kakar.

In September, the Federal Board of Revenue (FBR) had unearthed the country’s biggest tax fraud worth Rs314 billion committed by a fake company, K H & Sons.

Sources told ARY News that the tax fraud was detected by the Director-General Internal Audit Inland Revenue team. The K H & Sons company only existed on paper and is registered with a benami individual Muhammad Kashif.

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The fake company’s documents showed it was running the business of iron and steel, whereas, it mentioned addresses of Liaquat Market, Agri Market and M A Jinnah Market.

Sources revealed the name of the fake company was used for different illegal activities.

Surprisingly, the FBR had not registered any case against Rs314 billion of tax fraud despite the revelations. Sources said that the accused could flee abroad in case of further delay in the registration of the First Information Report (FIR).