10 former bankers sentenced to 17 years in prison for Rs33m fraud

A banking court has handed down a collective sentence of 17 years in prison to ten former employees of the National Bank of Pakistan and seven years to a private accused in a fraud case.

Mushtaq Ahmed Soomro, then operations manager at NBP's main Thatta branch, and other staffers of the bank - Ghulam Mustafa Khatri, Shahnawaz Shah, Abdul Majeed Memon, Manzoor Ahmed Khatti, Aftab Ahmed Memon, Shakeel Ahmed Khatri, Tufail Ahmed Memon, Syed Aftab Ali Shah and Ghulam Haider, along with Mukhtar Ali Palejo, properitor of M/s Mukhtar Ali & Company, were found guilty of misappropriating over Rs33 million through fictitious entries and bogus cheques in 2010.

Judge Javed Ahmed Keerio of the Special Court (Offences in Banks) Sindh observed that the ex-bankers committed offences punishable under sections 409 (criminal breach of trust by public servant, or by banker, merchant or agent), 468 (forgery for purpose of cheating), 471 (using as genuine a forged document), 477-A (falsification of accounts), 109 (abetment) and 34 (common intention) of the Pakistan Penal Code. Accused Mukhtar committed all these offences except breach of trust and falsification of accounts.

The judge noted that Mushtaq, Mustafa and Aftab were held as the principle accused who in connivance with other accused persons caused loss to the bank as well as other account holders. He said the rest of the bankers committed similar offences but "heinousness of their offence[s] is lesser than the offence[s] committed" by the principal accused.

The judge awarded them a total of 17 years in prison for these offences. The three principal accused were ordered to pay a fine of Rs12 million each while the rest have to pay a fine of Rs1.6 million each or undergo additional imprisonment on default.

Accused Palejo was sentenced to seven years in prison and ordered to pay a fine of 1.5 million or undergo additional imprisonment on default. The judge put the case against two absconding accused Muharram Ali Khushik and Abdul Ghani Khaskheli on dormant file till their arrest.

The judge observed: "It was serious banking crime committed by accused persons and account of accused Mukhtar Ali was instrumental to park such amount in his account. His involvement in the commission of offence cannot be ruled out. Evidence of the IO as well as those who had initially investigated the matter provided bulk of documentary evidence relating to his account in which, accused persons deposited amount which they subsequently withdrawn."

According to Federal Investigation Agency's prosecutor Muhammad Faisal Buriro, the FIA Commercial Banking Circle (CBC) had lodged an FIR on the complaint of NBP Main Branch Thatta manager Zaheeruddin Shoro, who stated that accused bank officials dishonestly and fraudulently made "flying entries" in various bank accounts and subsequently withdrew funds through bogus cheque numbers. He said that the accused were involved in fraudulent activities such manipulating fictitious entries, juggling debit and credit transactions between accounts and facilitating fraudulent withdrawals of amount using counterfeit or sequentially forged cheque numbers to bypass the computerised system.

The prosecutor contended that during investigation, then operations manager Mushtaq was found to have connived with other accused to manipulate records and misappropriate funds. The accused failed to conduct intelligent and thorough review of daily transactions, branch affairs and records as well as breached his duty by allowing unchecked fraudulent activities, he added.

He said Mustafa, OG-II/joint custodian at the bank, falsified signatures on cheques to withdraw funds from customers’ accounts, and transferred funds using the BBO System to conceal fraudulent withdrawals.

Faisal said that accused Shahnawaz, head cashier, tampered with cashier payment records to disguise fraudulent withdrawals. Accused Majeed, senior head cashier, ignored irregularities in cash department operations and failed to verify vouchers and records, while Manzoor, cashier, actively conspired with senior officials to commit fraud by processing unauthorised payments, he added. The prosecutor said that Aftab, cashier; Shakeel, Incharge Remittances; Tufail, cash officer; Aftab Ali Shah, and OG-II Makli Branch, were involved in these fraudulent activities. In their statement under Section 342 of the Criminal Procedure Code (CrPC), the accused denied charges and claimed to be innocent.