National Accountability Bureau (NAB) is said to have given “safe exit” to influential officers of National Fertiliser Limited (NFL) and booked the low level employees in imported urea scam amounting to Rs 1.6 billion.
A couple of days ago NAB, Lahore arrested nine accused in urea scam on allegations of misuse of authority, embezzlement and causing loss to national exchequer. The arrested persons are as follows: Muneeb Ahmed, Faizan Rasool, Abdul Mannan, Muhammad Tauseef, Salahuddin Shah, Shoaib Ali Toor, Salman Khan Niazi (Marketing Officers) , Syed Ejaz Hussain Bukhari (Ex Regional Manager) and Zaheer Afzal Chattha (Private Dealer).
Insiders in the NFML and Ministry of Industries and Production (MoI&P) have expressed surprise at the arrests of low-level officials and one dealer stated that the well connected officers who made decisions at the senior level have apparently been given a clean chit despite the fact the inquiry mentioned their names in a very transparent way.
“I don”t know what has happened. NAB has arrested only low level employees. Probably, NAB will get their statements to proceed further,” he added.
Another official claimed that NAB had also summoned one former General Manager (market and distribution) of NFML but at 3 pm he was allowed to leave.
However, arrests of NFML employees have sent a very strong message to Islamabad-based decision makers who recommended some of the employees for posting on lucrative positions. NAB had also quizzed a couple of officials surrounding the Minister. NAB Islamabad is also expected to shortly arrest Islamabad-based accused.
NFML developed ill repute through sale of imported urea through its dealers” network across Pakistan with a number of cases of urea theft and reported irregular sales from time to time. Last year, Secretary Finance, Dr Waqar Masood-led committee had recommended to the government to wind up the highly controversial organisation and sell imported urea through local fertiliser companies but the decision could not be implemented because no agreement was reached on the subsidy payment mechanism.
Dr Mukhtar, the then Senior Joint Secretary of the Ministry of Industries and Production (MoI&P) completed a fact-finding inquiry in November 2014 in which names of several officials were mentioned. According to NFML, record sale of urea on 16th January 2014 in Lahore Region was 405,160 bags amounting to Rs 649 million @ Rs 1600 per bag. This is an abnormal figure as this quantum of Fertiliser cannot be made available to dealers in a single day at NFML godowns. The price increase was w.e.f. 17th January 2014 @ Rs 1786 per bag. It can be safely presumed that the books of NFML were kept open till 22nd January 2014 for recording of sales at reduced price of Rs 1600 per bag. Moreover, no sale was recorded in the account books from 17th to 22nd January, 2014 in Lahore Region which clearly indicates mala fide on part of the then NFML management. The loss incurred by NFML on account of irregular and illegal sale on 16th January 2014 alone is Rs 75 million in the Lahore Region. This figure excludes freight charges and loading and unloading labour charges etc. It was presumed that urea which was misappropriated /dumped by cartage contractors was also adjusted on this date without physical delivery of urea stocks.
Official documents reveal that the Ministry of Industries and Production had written a letter to Chairman NAB citing the Managing Director NFML as stating that five cartage contractors were involved in misappropriation of 38,394 MT of urea in alleged connivance with officers who remained posted in NFML. The penalty to the tune of Rs 48,058,876 was imposed while the loss to the government exchequer has been estimated at Rs 1.620 billion. According to the fact-finding inquiry, five cartage contractors involved in misappropriation of urea and fraudulent practices were blacklisted on August 22, 2014.
Auditor General of Pakistan in its audit report of 2014-15 also sought clarification on decrease in profit of NFML on short term investments in private banks. According to the report short term investments stood at Rs 9.51296 billion as on June 30, 2014 as against Rs 8.939 billion of the previous year registering an increase of 6.37 per cent. The profit earned on investment in bank deposits has however decreased by 4.45 per cent from Rs 932.97 million during 2013-14 as against Rs 976.47 million( 2012-13). Auditor General argues that the disproportionate decrease in profit as against increase in investment needs clarification.
Deposits with banks for project stood at Rs 718.08 million as on June 30, 2014 as against Rs 663.27 million of the previous year. The amount has been invested in term deposits since 2011-12. However, the project has not yet established in spite of lapse of considerable period. Auditors say approval of the competent authority in support of establishment of project and reasons for non establishment of project need to be given.