Karachi, January 10, 2025 – The Federal Board of Revenue (FBR) has uncovered a massive money laundering scheme amounting to Rs 106 billion, linked to fraudulent practices in solar panel imports. This revelation came after an intensive investigation led by the Post Clearance Audit (PCA), South, a key arm of the FBR.
The FBR’s findings reveal that the operation was orchestrated by two brothers who utilized a network of seven shell companies based in Peshawar and Lahore. These companies, despite having a combined declared financial worth of only Rs 119 million, managed to launder billions through over-invoicing solar panel imports. According to the FBR, the perpetrators inflated prices by up to 500%, importing panels at $0.35–0.70 per watt that were originally priced at $0.15 per watt in China.
The investigation uncovered that the scheme involved the deposition of Rs 42 billion in cash across various commercial banks to disguise the illicit origins of the money. One glaring example cited by the FBR involved a dummy company, unregistered with the Securities and Exchange Commission of Pakistan (SECP), importing solar panels worth Rs 2.5 billion. The company’s supposed proprietor had an annual income declaration of only Rs 250,000, highlighting the scheme’s audacious scope.
The FBR’s report also revealed that the laundered funds were funneled to four Chinese companies owned by the same brothers, creating a direct link between the Pakistani and Chinese operations. This complex setup exploited the duty-free regime for solar panel imports, with the banking sector allegedly failing to adequately scrutinize suspicious transactions.
“For each import consignment, money was transferred abroad twice—once through Hawala/Hundi networks and once via the banking channel,” the FBR report stated, emphasizing the severe financial shocks inflicted on the country due to over-invoicing.
The FBR’s findings spotlight systemic loopholes in monitoring and enforcement, with the PCA playing a pivotal role in uncovering the scam. The case also underscores the need for enhanced collaboration between the FBR, SECP, and banking institutions to prevent such fraudulent activities.
This incident further strengthens the FBR’s commitment to combating financial crimes, ensuring accountability, and safeguarding Pakistan’s economic interests in the face of such significant challenges.