Shahmir Kazi talks about a serious issue
It is reported that investigations regarding the dubious recycling of Stolen money is difficult to recover & returned by the British government to Pakistan declared as ill-gotten wealth by Bahria Foundation clearly indicates that recovering stolen money is indeed very difficult to recover. Stashing illicit financial assets in countries other than the country of origin is a global problem that most states encounter. Even the developed world is not free of the adverse impact of such flow of capital and their economic managers keep on regulating their legal structure to counter this menace. Very recently the British government passed a law, Unexplained Wealth Orders, aimed at checking the source of illegal wealth stashed in the UK. It is estimated that at least 100 billion pounds of illicit wealth is laundered through the UK each year and the source of such illegal transactions is poor countries like Pakistan.
Pakistan acutely suffers from this financial malpractice and the political activity of the last few years gave rise to public awareness of this serious financial failing and it has now become a national demand. The emphasis is to accurately calculate the estimated flight of capital and then to make arrangements for its repatriation. The new government took the matter up in its first cabinet meeting and established a Task Force to look into the matter and devise methods to get the stolen money back.
This indeed is a serious matter as it is estimated that under the garb of Protection of Economic Reforms Act 1992 by Nawaz Sharif government an average amount of US$8 billion was sent abroad annually from foreign currency accounts and there appears to be a grain of truth in widespread reports that something like $200 billion has actually been siphoned off and stashed abroad. If illegally earned money through parallel economy is counted then the amount would become correspondingly more but that would certainly enter the domain of conjecturing.
In this context Switzerland was and is still considered a safe haven for parking ill-gotten wealth though there have been intense international efforts to curb this tendency and under this pressure the Swiss banking system has wilted considerably and its sources now keep on revealing from time to time the financial data of the money held in Swiss accounts. It is reported that currently the Swiss banking system holds huge figures and this also includes Pakistani account holders but many agencies have found it cumbersome to take the matter further. Pakistani authorities are bound to investigate as Pakistan has signed OECD Multilateral Convention that allows for seeking actionable information that may enable FBR to officially receive information about off shore accounts and assets of Pakistanis.
It is worthwhile to point out that the EU member countries, United States and many other countries recovered billions through taxation agreements to retrieve the past funds siphoned off, an action that also checkmated any such future losses. Pakistani governments have willfully avoided obtaining information through debates and actions for the retrieval of untaxed assets as most of their members were complicit in the wrongdoing. It is commonly known that the US secured over $11 billion in backdated taxes and fines from Swiss bank clients and obtained documented evidence to penalise lawyers and other facilitators. The Nigerian oil wealth looted by its rulers to the tune of over $2 billion was finally recovered and given back to Nigeria in 2014 by Switzerland, Luxembourg, Jersey, Liechtenstein, Belgium and the UK. In the Philippines the authorities have been successful in retrieving $1.8 billion of the stolen money by President Marcos’ regime during more than two decades of its rule.
The issue has grown in complexity after the World Bank declared that corruption robs the developing world of $40 billion annually and it was due to the recovery drives launched by various international agencies that Australia, Switzerland, France, Luxemburg, UK and America froze $2.6 billion worth of corruption-related assets. Many developing countries like Angola, Peru and Kazakhstan have been able to partially retrieve looted national assets.
The global drive to retrieve stolen money consists of tracing, freezing, forfeiting and repatriating illicit money though the process is quite cumbersome as no country likes to part away with the money stashed in its accounts. The process, however, is quite doable provided developing countries like Pakistan seriously initiate proceedings through providing forensic accounting evidence that cannot be contested. Pakistani accounting profession is quite advanced now and it may very well be possible to dig-out relevant data. Moreover, many agencies are now in operation including UNODS, OECD and FATF that can aid in asset recovery process. Successive Pakistani administrations have taken the easy path of declaring amnesties despite the poor results of such schemes but such schemes came nowhere close to similar concessions initiated by Indonesia and many other countries. The biggest drawback to retrieve stolen assets pertains to the lack of political will that hampered successive governments’ efforts to bring the money back. TW