ISLAMABAD: In a startling revelation, Chinese investor Zhi Cheng Li has voiced his concerns over business protection in Pakistan, shedding light on challenges faced by foreign investors in seeking justice after encountering financial fraud in the country.
Mr. Li, speaking to the media on Sunday, detailed his harrowing experience with Pakistani partners in the oil and gas development sector. He alleged that his local partners deceitfully registered a duplicate entity at the Securities and Exchange Commission of Pakistan (SECP), using a strikingly similar name to his company. Furthermore, they opened parallel bank accounts through fake affidavits and forged signatures.
Cheng Li’s Hong Kong-based company had made a substantial investment of $178 million in a project aimed at supplying processing gas units, an LPG recovery plant, and related facilities at the Nashpa oil field in Khyber Pakhtunkhwa’s Karak district.
“The Pakistani partners illicitly sold my shares and assets, depositing the proceeds of approximately $13 million into the fraudulent bank accounts they had established,” he lamented. Despite filing a complaint in 2017, Mr. Li expressed his disappointment with the lack of action by the financial crime-fighting authorities.
He reported that he had filed a complaint with the Federal Investigation Agency (FIA) against the fraud involving duplicate entities and fake bank accounts. However, the agency had not conducted a thorough inquiry. “As I am based in China, I cannot attend hearings in Pakistan regularly. The FIA kept the inquiry pending for over three years, eventually closing it in 2020 without providing any explanation,” Mr. Li explained. He also mentioned that he had requested the reopening of the inquiry in 2020, providing all necessary evidence to a new investigation officer.
Mr. Li disclosed a copy of the letter he submitted to the interior ministry in September 2021 and stated that he recently received contact from the FIA’s investigation officer, Muhammad Mazhar, who requested his presence in Pakistan to conclude the case.
“Now, after being in Pakistan for over a month and several meetings with the IO, I have been informed that an FIR will be filed against the accused for financial fraud, fake bank accounts, and duplicate company registration,” he revealed. However, he expressed frustration as the case was transferred from the FIA’s Commercial Banking Circle (CBC) to the Anti-Corruption Circle (ACC) by Director FIA, Islamabad Zone, Abdul Jabbar Rana, without affording him an opportunity to be heard.
Mr. Li emphasized that this was not a government case and, therefore, should not be under the purview of the anti-corruption circle.
In response, Muhammad Mazhar of FIA declined to comment on media queries and redirected them to the agency’s spokesperson. Notably, there is no official spokesperson for the FIA, leaving questions surrounding the case’s handling in limbo.
Zhi Cheng Li’s case serves as a stark reminder of the challenges faced by foreign investors in Pakistan and underscores the pressing need for a fast-track forum to resolve business disputes and legal issues involving foreign investments. The outcome of this case will undoubtedly influence the perception of Pakistan’s investment climate among international investors.
