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ECONOMIC
CRIME WING (ECW).
The
Anti-Corruption and Economic Crime Wing of FIA transferred
to National Accountability
Bureau (NAB) on 16.08.2004 have
been restored vide
notification dated 24.10.2008.
The
Economic Crime Wing (ECW) is headed by an Additional Director General at HQ to
assist the Director General
Operational activities of ECW are governed by
the Zonal Directors. This Wing is responsible for investigation
of cases pertaining to pilferage of Government revenues
occurring through evasion of taxes/duties levied by
the Federal Government. It also investigates into various
mal-practices and frauds in banking sectors (FDIs),
public sectors, corporations and autonomous/semi autonomous
bodies set up, controlled or administered by or under
the authority of the Federal Government.
INTELLECTUAL PROPERTY RIGHTS ENFORCEMENT
The Federal Investigation Agency has constituted an Advisory Committee on IPR Enforcement comprising of Ms. Ameena Saiyid, Managing Director, Oxford University Press, Mr. Kamal Ahmed, Country Manager, Microsoft Corporation Pakistan, Mr. Hasan Irfan Khan, Advocate, M/s Irfan & Irfan, Mr. Q. M. Shahed of Pakistan Tobacco Company, Mr. Ikram ul Majeed Sehgal, Security & Management Services, Mr. Muhammad Siddique, Collector Customs (Legal), as honorary members.
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2. On the invitation of Director General FIA, an inaugural meeting of the Advisory Committee was held on 2nd July 2009. It was Chaired by Mr. Irfan Nadeem, Addtional Director General FIA / Economic Crime Branch, at FIA HQ, Islamabad. Besides, the above members and FIA officers, Syed Khalid Mehmood Bokhari, Director General IPO-Pakistan, also attended the meeting.
3. At the outset, the Addl. Director General ECW warmly welcomed all the participants, followed by presentation by Mr. Shahid Nadeem Baloch, Director IPR on the performance of FIA and its future plans, which was highly appreciated. The participants discussed current issues relating to the IPR Laws, Enforcement Actions, Challenges being confronted with and the mechanism to be adopted for effective enforcement of IPR Laws in Pakistan. The participants agreed on sharing of database, capacity building of Investigators, Prosecutors, initiating a proposal for establishing Special Tribunals for speedy trial of IPR cases and mutual cooperation in crime fighting, in coordination with IPO-Pakistan. While FIA’s initiative of organizing a high level forum of IPR was appreciated, it was also decided to continue such meetings followed by Seminars/Conferences as a part of awareness campaign.
4. Four working groups for the Policy Formulation, Awareness Campaign, Sharing of Database and identifying “Big Fish” involved in large scale IPR violations have been formed for submitting their reports in the next meeting.
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MINUTES OF INAUGURAL MEETING OF FIA’S ADVISORY COMMITTEE ON IPR ENFORCEMENT, HELD ON 2ND JULY 2009 AT FIA HQ, ISLAMABAD
The inaugural session of FIA’s Advisory Committee on IPR Enforcement was held on 2nd July 2009 at 11 a.m. at FIA HQ, Islamabad. It was Chaired by Mr. Irfan Nadeem, Addl. Director General FIA / Economic Crime Branch, FIA HQ Islamabad. List of the participants and Agenda of meeting are annexed.
At the outset the Addl. Director General FIA conveyed a message of welcome of Director General FIA Mr. Tariq Khosa, who could not make it to the meeting due to another official commitment. He then warmly welcomed all the participants, especially the honorary members of Advisory Committee and apprised them about the global importance of Intellectual Property Right in general and the challenges on the subject being confronted with, in Pakistan, in particular. Federal Investigation Agency genuinely needs the valuable guidance / assistance of the Advisory committee in our commitments to combat the menace of IPR violations, keeping in view the basic core values, he added ;
PRESENTATION BY DIRECTOR FIA / IPR
A presentation was made by Mr. Shahid Nadeem Baloch, Director IPR regarding the performance of FIA on the enforcement of IPR Laws, since FIA was mandated in 2005:
S# |
Elaboration by Director |
Observations of the Participants |
1. |
Introduction |
Background and the importance of IPR very well defined. |
2. |
Government’s Resolve |
Creation of IPO-Pakistan and empowerment of FIA with the inclusion of Copyright Ordinance on the schedule of FIA is a first step. Trade Mark Act and other IPR Laws need review and enforced. |
3. |
Scenario in Pakistan |
Situation encouraging, yet a lot to be done. |
4. |
IPR Laws in Pakistan |
Trade Mark Act and other IPR Laws need review and enforcement. |
5. |
Achievements |
FIA’s performance in curbing the menace of IPR violations encouraging. |
6. |
Important Cases |
Contribution of FIA with huge seizure of pirated products and counterfeit optical discs / software remarkable |
7. |
Progress of Cases |
Capacity building of Investigators / Prosecutors needs to be improved for better convictions. |
8. |
Activation of IPR Field Units |
IPR Field Units to be activated / equipped with adequate strength / logistics. |
9. |
Way Forward |
Strengthening of IPR Enforcement in areas of Book / Software / Films & Music Piracy and Copyright violations of Pharmaceutical products – agreed. |
10 |
Recommendations |
Recommendations regarding empowerment of FIA to enforce Trademark Laws along with Copyright Laws, establishing Special Tribunals for speedy trials and capacity building of Investigators / Prosecutors and Judges – endorsed. |
The presentation was appreciated by the participants. The Addl. Director General than opened the floor for discussion and invited the views / suggestions of the Advisory Committee on the issue of IPR enforcement. The suggestions / discussions of the members are reproduced hereunder
.
S# |
Name |
Views of the Hon. Members |
1. |
Mr. Hasan Irfan Khan, Advocate Supreme Court
assisted by
Mr. Mueen Qamar, Advocate |
As a first step, educating people on software issues and effective action to eradicate and cut the origin of IPR violations carries paramount importance. The issues of requirement of complainant, pirated/copied books sale in schools, enforcement of trademark ordinance and role of judiciary may be taken up. Counterfeit medicines affect the quality of health and our livelihood. Creation of Courts and Tribunals is a sensitive issue and for getting positive results, judiciary is to be taken in confidence. |
2. |
Ms. Ameena Saiyid OBE |
She apprised the participants that to change people’s thinking and their priority regarding IPR violations, lot of efforts needed to convince people that piracy is a very important issue and that they share the responsibility to eliminate it. Enforcement to be extended to the extent of pirated labels on medicines / food items. Pakistan is being used as a transit base for Iranian pirated books which are being smuggled and sold in large scale in Pakistan, Afghanistan and India, since Iran is not signatory to relevant world conventions. She emphasized the need of nabbing the whole-sellers of pirated products and promised that she would provide list of such big groups involved in the large scale trading. Packaging area to be focused as it covers Copyright violations coming in the purview of FIA, she added. There is no provision of minimum punishment in IPR Laws which is a barrier in creating deterrence. She assured of her support in organizing awareness campaign. |
3. |
Mr. Kamal Ahmed,
assisted by
Mr. Salman Siddiqui. |
Ground realities to be realized and enforcement should not be limited to the books / money. Piracy / Counterfeiting of Software, Food Items, Pharmaceutical products also be given same importance. Scores of IPR violation cases intercepted by FIA would justify establishment of Special Tribunals. Identification of counterfeit areas requires a joint and well organized campaign. IPR violation within Pakistan is a matter of great concern as one CD comes in, then pirated on large scale and launched for sale. Due importance is to be given to the tactical side and the requirement of the complainant may be waived off, since the copyright violation is cognizable offence. Big Fish on demand side also to be sorted out. Microsoft would extend all possible cooperation / assistance. |
4. |
Mr. Q. M. Shahed, Pakistan Tobacco Company. |
Public awareness on IPR may be organized through media and all Ministries to share this responsibility. Especially Ministry of Education may be moved for adding one page in a book for awareness on IPR at School / College level. Offences of printing and labels are co-related. IPR violations are given very low priority from crime point of view. |
5. |
Mr. Ikram ul Majeed Sehgal, Security & Management Services |
Coordinated efforts could be done with the help of all stakeholders. The concerned companies can design effective automated and actionable initiatives. Software persons can create National Database. Raids conducted should be well publicized in print and electronic media. Awareness campaign be launched involving print / electronic media including Talk Shows on TV channels. |
6. |
Mr. Muhammad Siddique, Collector (Legal) |
Emphasized on the need of capacity building of Investigators / Prosecutors in coordination with IPO-Pakistan as World Intellectual Property Organizations (WIPO) has international obligation for the developing country members. IPO-Pakistan to share the responsibility by contributing its effective support to Enforcement Agencies in financing training / enforcement requirements as also in organizing awareness campaign. He also made a brief presentation on the role of customs concerning IPR Enforcement. |
7. |
Syed Khalid Mehmood Bokhari, DG
IPO-Pakistan |
Expressed his sincere thanks on organizing such a graceful high level forum on IPR enforcement. IPO should have done it much earlier, he added. Awareness is not a particular issue alone. A joint effort of all stakeholders could move the government for according due priority to IPR enforcement in Pakistan. Media channels should bring at least one talk show every month on IPR subject. FIA to keep continued with good performance and such conferences with concrete ideas, for sharing progress and follow up. We can organize lectures and debates in Educational Institutions. He assured of outright support of IPO in managing the required awareness campaign and other related issues. |
Mr. Shahid Nadeem Baloch, Director FIA / IPR advanced the idea of organizing and celebrating IPR Week as a big event in October/November 2009 through the courtesy of IPO-Pakistan, as a part of effective awareness campaign. During the week, Print / Electronic Media can contribute through Articles, Features and TV Talk Shows. While all participants warmly welcomed the idea, DG IPO-Pakistan promised to extend all possible support to make it a success. Director IPR further apprised the participants that knowledge of the source and route of pirated products plays a pivotal role in intercepting and prosecuting the violators. FIA is on its way to establish IPR Intelligence Units in each zone. Nevertheless pirated products manufacturers / sellers can be identified in collaboration with all stakeholders, as they share equal responsibility
Mr. Muhamamd Azam Khan, Director Law apprised the participants about the current challenges being faced by FIA Investigators / Prosecutors at trial stages of IPR cases. The accused parties engage highly paid high profile lawyers to defend while the services of FIA’s Prosecutors are confined to limited courts. In most of the cases higher courts have stayed the investigation / prosecution proceedings and the problem could not be resolved for want of Special Prosecutors demanding very high fee. We need identified skilled lawyers to appear in courts for the assistance of I.O.s / Prosecutors, he added. He also pointed out that piracy of printing and labels are the violation of Copyright Ordinance and Trademark Ordinance respectively and both laws are co-related. However, FIA can take cognizance only to the violation falling under its purview. For making IPR Laws Enforcement more effective and deterrent punishment proposal may be initiated mainly by the parties being affected. Examination of relevant laws and advocacy of punishment is to be made by stakeholders with a view to extending active support to FIA in its commitment of fighting crime. He further disclosed that issue of necessity of complainant in IPR cases is pending decision in High Court, Karachi.
Mr. Hasan Irfan Khan requested the Director Law for providing details of such cases and assured of providing all possible assistance to FIA in
overcoming the problem of complainant requirement.
Director IPR proposed for making one comprehensive IPR Law with minimum punishment expressly provided. He further proposed formation of working groups on relevant subjects for presenting their suggestions / reports in the next meeting of the Advisory Committee.
Director Crime FIA HQ proposed exploring short term as well as long term areas of enforcement measures. COS to DG FIA endorsed the idea of well planned awareness campaign. ADG Immigration shared his views regarding importance of capacity building of the Investigators / Prosecutors for having better skill of quality investigation/prosecution, as also knowledge about the market, violators and aggrieved parties.
The outcome of the meeting on 07 points agenda, after extensive discussion is enumerated as under;
S# |
Agenda
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Decision |
1. |
Policy and approach to
tackle IPR crimes. |
May be given high priority from crime point of view. Coordinated efforts needed.
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2. |
Training / capacity building of FIA Investigators in IPR crime |
All stakeholder to contribute and the IPO-Pakistan provide all possible assistance of the highest standards to FIA |
3. |
Identification of areas and assigning priority to IPRviolations.
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Agreed for sharing database and best practices |
4. |
Creation of IPR database having useful information about piracy in different fields, person involved in the business and case/
enquiries.
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All stakeholder to share the
responsibility and work jointly
for the creation of national database |
5. |
Identification of Big Fish involved in large scale piracy/production. |
Agreed to move faster in this direction. Ms.Ameena Saiyid offered to provide list of whole-sellers of pirated books / products. |
6. |
Awareness Campaign |
Agreed. Utmost importance to be given and coordinated efforts shall be made by all concerned. |
7. |
Formation of Working
Group to develop IPR
Manual / Procedural
Rules.
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Agreed. |
In summing up, the committee unanimously decided the formation of following 04 working groups, to submit their suggestions / reports on their respective subjects in the next meeting;
S# |
Subject
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Working Group |
1. |
Policy formulation / revision of IPR Laws for amendments |
Mr. Hassan Irfan Khan Assisted by DG IPO Pakistan & Director Law, FIA HQ.
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2. |
Awareness campaign |
Ms.Ameena Saiyid in coordination with
DG IPO & Director IPR FIA HQ. |
3. |
Sharing of Database and Identifying Big Fish |
Mr. Kamal Ahmed & Mr.Ikram ul Majeed Sehgal |
4. |
Drafting of IPR Procedural Rules / Manual for FIA’s Enforcement. |
Mr.Muhammad Siddique in coordination with
Director Law, FIA HQ |
Mr. Irfan Nadeem, Addl. Director General FIA lauded the participants for their time and very informative session of discussions, giving new dimensions. Government needs to be given an in depth briefing on IPR Enforcement for assigning due priority to this important issue on the basis of long / short term measures, with a view to building our national image and improving international ranking, he added.
The meeting ended at 2:45 p.m. with a vote of thanks to the Chair.
Operation zarco
CASE FIR NO 09/2009 DATED 21-02-2009 U/S 4/5/8(1) FERACT 1947,
420/468/471/109/409 PPC 7/8/9 PECO 2007 R W"5(2)47 PCAOF FIA
On the advice and directions of the Governor State Bank of Pakistan and the
Minister of Interior a campaign was launched for
the control of Hawala (Undocumented/Informal Fund Transfers) and flight of capital. It
was noticed that the foreign exchange companies were involved in the above acts which
also caused the loss of capital and depletion of foreign exchange reserves. The action was
in the backdrop of economic crisis, pressures and the fast worsening economic situation,
devaluation of PKR vis a vis Dollar and other currencies.
FIA Punjab assumed a leading role with two fold strategy to curb this trend.
Firstly, checking of international (and domestic flights as well) bound for UAE, Bangkok,
China etc with the objective of prevention of physical transportation of foreign currency.
Secondly, a crackdown operation was launched against foreign exchange companies
involved in the above referred illegal acts in violation of Foreign Exchange Regulation
Act and the rules and policies notified there under by the SBP.
In the flow of this operation, six well known foreign exchange companies were
booked by FIA Punjab and the culprits sent behind the bars. Amongst these, ZARCO
Exchange Company Pvt Limited (ZECPL) 32-A Lawrence Road, Lahore with 727
branches / franchisees operating in Pakistan was found involved in hawala business as
well as flight of capital. Syed Lakht-i-Hasnain is the Chief Executive Officer of ZECPL
with 99.99 percent shares of the company. He has also dual nationality having American
passport.
Each full fledged foreign exchange company is bound to operate under the Foreign
Exchange Regulation Act 1947, State Bank of Pakistan Manual and rules/regulations
notified there under. Instead, ZECPL operated / functioned in violation of the rules and
regulations notified by SBP. The firm also ignored the ethics of business. Followings are
some of the gross illegalities committed by the firm.
i |
From January - November 2008, the company executed Foreign Telegraphic
Transfers (FTTs) to the tune of US$ 303.58 Million in the shape of hawala but
not reported to SBP, thus causing a colossal loss to national exchequer. |
ii |
As per SBP circular inward / outward remittances are to be reported on daily
basis. The company concealed outward remittances amounting US$ 43.13
Million during July - December 2008 by not reporting the same to SBP. The
economy was badly hurt by this flight of capital. |
iii |
The above statistics for the specified period are on the basis of data provided by
ZECPL and authenticated by SBP. The investigation team has taken into
possession the main server of the firm. Further detection and data retrieval by
the cyber forensic experts is under process. Final totals shall certainly be
manifold after preparation of analysis report. |
iv |
The company had saved scanned images of 125 x CNICs of different persons
in its system. These were used for the outward hawala and flight of capital thus
causing loss to national exchequer in many ways. These card holders in fact
had provided copies of their NICs at some point of time for receipt of inward
remittances received through Western Union. But the company used these
scanned information of the cards malafidely in order to conceal the data of
outward hawala senders. In that regards, the possibility of money laundering
cannot be ruled out. |
v |
As per record, Syed Lakht-i-Hasnain got transferred Rs. 380 Million during
November 2006 - May 2009 to his personal accounts abroad. Interestingly after
taking stock of ZARCO's affairs by FIA on 21st February 2009. he suckedanother Rs. 110 Million of the general public to his personal accounts in
foreign banks. |
vi |
Syed Lakht-i-Hasnain was given ample opportunities for explanations and to prove his innocence. He was served with a questionnaire. He was confronted
with the data/information in the presence of the representative of SBP as well
but no satisfactory replies were given to the queries raised by FIA. |
vii |
The report prepared by the investigation team for taking cognizance against
Syed Lakht-i-Hasnain and others was sent to the SBP through FIA HQ. The
SBP in its Report also endorsed the viewpoint of FIA investigation team. Thus
accordingly warrants of arrest of Syed Lakht-i-Hasnain were obtained from the<
competent court and efforts are underway to arrest him. |
viii |
As per SBP Report, ZECPL owes US$ 6 Million to the Western Union.
Similarly company owes Rs. 90.048 Million to its local associates. |
ix |
Reportedly, HM Revenue & Customs authority of UK is also conducting an
inquiry into the affairs of ZARCO Exchange (UK) Limited (Subsidiary firm of
ZECPL). |
x |
FIA Lahore is receiving complaints from the associates of ZECPL and the
general public regarding the malpractices and recovery of the outstanding
amounts from ZECPL. |
On the basis of above mentioned evidence, it is crystal clear that Zarco Exchange
Company Pvt Ltd owned and operated by Syed Lakht-i-Hasnain is involved in illegal
business of Hawala, loss and flight of capital, cheating, fraud, forgery and apparent
criminal breach of trust. Reportedly he has acquired assets in UK and USA from the
looted money of the general public
Director
FIA Punjab
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