The Privatisation Commission has through persistence and the strong determination by NAB, received the Voluntary Return offer of Rs. 404.5 Million by Mr. Asif Kamal, Chairman TIBL. The decision was approved by the Executive Board of NAB in a meeting held on 18th April. Given that Rs. 294.37 Million had been recovered earlier, PC will now be able to recover a total amount of Rs. 698.87 Million on account of Rs. 500 Million initial placement of funds with TIBL.
In 2010, Trust Investment Bank Limited (TIBL) procured PKR 500/- Million of Public Money in two tranches i.e. Rs. 300 Million and Rs. 200 Million on 26-05-2010 and 28-06-2010, respectively at the rate of return of 12.85% per annum for a period of one year.
The investment of Rs. 500 Million was made in violation of sections 14, 16, 18, 19 and 20 respectively, along with other enabling provisions, rules and regulations of the Privatisation Commission Ordinance, 2000 (PC Ordinance) and the Trust Act, 1882.
In February 2011, it was noticed that the investment made with TIBL was in breach of the Finance Division instructions, as well as the provisions of Section 14 of the PC Ordinance. TIBL was therefore requested for an early withdrawal of the invested amount in February 2011. However, TIBL not only refused to return the amount but also expressed its inability to return the amount even upon maturity i.e. in May & June 2011, respectively. After liaising with Finance Division, State Bank of Pakistan (SBP) and Securities and Exchange Commission of Pakistan (SECP), PC and TIBL entered into a Settlement Agreement on 28 November 2011, whereby TIBL deposited eight post-dated cheques with PC spanning over a span of 12 months for the repayment of principal outstanding amount of Rs.500 Million while agreeing to service mark up at 14% per annum on the outstanding amount.
All the cheques got dishonored upon presentation and the PC was therefore constrained to lodge an FIR with FIA on November 11, 2012 under Section 409 (criminal breach of trust) & 489F (dishonor of cheques) of the Pakistan Penal Code, 1860.
Subsequently, the Supreme Court also took a suo moto notice of the matter and directed FIA and NAB to investigate the matter along with the Finance Division and the Privatisation Commission to ensure that every effort would be made for recovery of the amount invested with TIBL along with markup.
On 3rd July 2013, an amount of Rs. 294.37 Million was recovered in lieu of Principal as well as markup against Rs. 500 Million; thereafter, no substantial progress could be made. However, the current PC management started actively pursuing the matter before all forums, which include the Supreme Court, High Courts (Lahore & Islamabad), Banking Court, Lahore and with the investigation agencies i.e. FIA and NAB.
As a result of the relentless pressure exerted by PC, an application for voluntary return of the looted amount was filed by the defaulters with NAB for a lesser amount of only Rs. 210 Million. TIBL also refused to service the accrued markup. However, the PC continued to actively pursue the matter with the NAB, and insisted on the current actual balance amount due, including the markup, which has now finally been accepted by the defaulters and the Voluntary Return offer has been approved by NAB.