Pakistan’s Forex Scam Saga: A Complex Web of Charges and Acquittals
Background
The Pakistan Forex scam, which emerged in 2008, centered around Munaf Kalia, the CEO of Khanani and Kalia International (Pvt.) Ltd., and others, who faced charges of illegally transferring funds from Pakistan to Afghanistan.
- Sudden action against Khanani and Kalia International
- Shutting down their offices and revoking their license
- Extensive fund transfers from Pakistan to Afghanistan
- Illegal under country’s rules and regulations
The Arrest of Munaf Kalia and Others
- Launched an investigation into the cause of the rupee’s sudden drop
- Turned to Interpol for help in raids throughout Pakistan
- More than 12 people were detained
- Munaf Kalia was charged with violating foreign exchange regulations
The Hawala Trade Crackdown and Khanani and Kalia Case
- Introduced measures to crack down on the Hawala trade
- Zarco Exchange faced similar allegations
- Its CEO was released due to lack of evidence
- Khanani and Kalia case remained under investigation
acquittal and the Supreme Court’s Intervention
- Defendants were acquitted in March 2011
- Controversy over the acquittal
- Supreme Court granted the FIA’s petition for an independent investigation
Related Cases and Significance
- Separate action by FIA failed due to missing evidence
- Hawala trade’s role and significance in Pakistan’s informal economy
References
- “Arrested money dealer admits link to forex scam - GEO.tv”
- “Hawala case: Khanani and Kalia acquitted,” The Express Tribune
- “The News International: Latest News Breaking, Pakistan News,”
- “The News International: Latest News Breaking, Pakistan News,”
- “GEO.tv: Govt suspends Khanani & Kalia’s license - GEO.tv,”
- “Man accused of illegal Rs67b transfer freed,” The Express Tribune
- “Khanani and Kalia: Acquittal being investigated by SHC,” Khabrain
- “FIA set to lose another Khanani-Kalia case,” Dawn
- “The government’s action against Hawala trade,” Pakistan Economist
- “The Hawala network: Its role and significance in Pakistan’s informal economy,” International Journal of Commerce and Economics