ISLAMABAD: After expressing displeasure with an investigation into Rs70 billion in under- and over-invoicing by two importers involving commercial banks, a Senate subcommittee on Monday demanded a thorough audit of all imports of solar panels since 2018.
The Senate Standing Committee on Finance and Revenue, chaired by Senator Mohsin Aziz, said after a meeting of its subcommittee that new information had surfaced about a large over-invoicing in solar panel import transactions totaling billions of dollars.
The State Bank of Pakistan has already punished the two corporations and two banks implicated for “negligence,” thus the panel demanded a comprehensive probe into their behavior.
Senator Aziz asked, “We are now hearing about fines and penalties, but what tangible action has been taken against the actual perpetrators of the scandal?”
raises concerns about two corporations’ “staggering” purchases.
The discussion looked at how two significant businesses, Moonlight Traders and Bright Star Business, were involved in financial irregularities. With Bright Star and Moonlight, two significant actors, at the center of the matter, it was disclosed during the meeting that transactions from these companies triggered considerable red lights.
Between 2018 and 2022, the two businesses were said to have engaged in questionable transactions totaling Rs106 billion, with cash accounting for a large amount of these transactions. In order to prevent sovereign default, Mr. Aziz questioned the degree of flexibility with which these questionable import limitations occurred during the height of import restrictions and difficult economic times. He questioned, “How can businesses have made such large single transactions when typically much smaller amounts raise red flags?”
It was discovered that the aforementioned organizations conducted operations to import solar panels using accounts they had opened at Askari Bank and Dubai Islamic Bank branches in Lahore. According to authorities cited by the Senate committee, “Bright Star alone made over Rs2.7 billion in transactions in 2018 and continued making payments, including Rs5 billion in 2019, Rs1.5 billion in 2020, and Rs2.5 billion in 2022.” In a same vein, Moonlight recorded a turnover of Rs7.9 billion, including a sizeable sum in cash.
According to the announcement, “some solar containers were cleared at lower than market prices, while others were cleared with inflated values.” The panel also found other cases in which solar imports were cleared at greatly inflated values. Committee member Senator Shahzeb Durrani pointed out that the FBR ought to have been made aware of this disparity far sooner.
Concerns over the nature of these transactions were voiced by the FBR and the Financial Monitoring Unit (FMU). Serious concerns about possible money laundering were aroused when FBR officials verified that over Rs46 billion in questionable transactions were reported, many of which involved cash payments.
“State Bank authorities disclosed that Askari Bank and Dubai Islamic Bank were penalized for their carelessness in the disaster. The tribunal announced that Askari Bank had been fined Rs40 million and Dubai Islamic Bank had been fined Rs27 million for failing to promptly report the financial irregularities.
Three people have been detained so far in relation to the incident, although they are now free on bond. “But there are still a lot of unanswered questions, especially about the full scope of such massive over-invoicing in the financial transactions laundering operation involving the import of solar panels,” the statement stated.
As a result, the committee unanimously suggested that all businesses engaged in solar imports between 2018 and 2022 undergo a thorough audit, that financial transactions involving solar panel imports be better monitored and regulated, and that the role of commercial banks’ negligence be looked into right once.
