Friday, April 05, 2013
Former SECP chief, two colleagues earned millions in bonuses | AAJ News
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SECP high officials warding themselves with the money of tax payers!
Degree scrutiny: SECP directors under spotlight | Business | DAWN.COM
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Degree scrutiny: SECP directors under spotlight | Business | DAWN.COM
The story published in daily Dawn and the spokesman for SECP explain the position sine 30th October, 2011 and no action so has been taken by SECP.
Appointment of executive in SECP challenged | Latest news, Breaking news, Pakistan News, World news, business, sport and multimedia | DAWN.COM
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A question or good governance of SECP and good justice by High Court is still awaited. To learn more about the issue, please click the above headline link.
Tuesday, April 02, 2013
SECP - snoozing at night dog!
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What they may not have known was that the accuser himself was being sued for embezzlement by the JS Group and appears to have been trying to cover his tracks by levelling a counter-accusation.
Over the past week, Ghani Osman, CEO of brokerage firm Ghani Osman Securities, has been raising the issue of what he terms an unfair advisory fee of Rs431 million paid to Ali Jahangir Siddiqui, the son of the founder of JSCL, prominent Pakistani investment banker Jahangir Siddiqui. Osman claims that this advisory fee was unfair, and constitutes a violation of fiduciary responsibility to shareholders on the part of the executives of the company.
The timing of Osman’s accusation, however, is somewhat suspect. It comes on the heels of a lawsuit filed by JSCL CEO Suleman Lalani, accusing Osman and others of embezzling over Rs220 million from Al-Abbas Sugar Mills, in which Osman, his family, and his associates own a majority share. The various entities of JS Group own close to 20% of Al-Abbas.
The showdown between the two brokerage houses, meanwhile, has captured the attention of Pakistan’s financial services community, especially since one of the parties involved – the JS Group – is a widely known and respected firm, considered by some to be Pakistan’s equivalent of Goldman Sachs.
In the legal complaint filed in the Sindh High Court on March 12, the JS Group alleges that Ghani Osman, in collusion with Al-Abbas CEO Shunaid Qureshi (a nephew of Jahangir Siddiqui) have colluded to siphon money away from the company’s accounts using a series of shell companies and accounts.
The fraud appears to be remarkably crude. In addition to sugar, Al-Abbas also produces ethanol from the molasses which results as a by-product from the manufacture of sugar. Al-Abbas’ capacity to produce ethanol greatly exceeds its internal generation of molasses so it buys molasses from other sugar mills. What Osman and Qureshi appear to have started doing was making payments for molasses that never arrived at the factory.
At least nine shell companies were used to funnel money from Al-Abbas to Osman and Qureshi, on the pretext of buying molasses. Those shell companies received the money and then, within a few days, transferred the money to either Osman, or Qureshi, or occasionally to their family and other associates.
For instance, a company called Rustam Traders was paid Rs17.5 million on September 10, 2012, ostensibly for molasses that never arrived at Al-Abbas. On September 17, seven cheques, each of Rs2.4 million (totalling Rs16.8 million), were made out by Rustam Traders to Shunaid Qureshi.
Another vendor, Ideal Transporters, was also paid for molasses but about Rs19.9 million of that money was paid to Osman and another Rs17.2 million was paid to his brokerage firm, Ghani Osman Securities.
In some cases the payments were made on by the shell companies directly to banks to which Osman and Qureshi owed money. This led some at JSCL to conclude that even the signatures on the bank accounts being operated by the shell companies were faked. The Express Tribune was able to see at least one case where the alleged owner of Rustam Traders filed a document with Silkbank to notify them that the signature on his cheques would be different from the signature that appears on his computerised national identity card.
In a bid to stem this flow of embezzlement in a company in which the group had such a large share, Ali Jahangir sent a letter to the Securities and Exchanges Commission of Pakistan on March 8, asking them to send an observer to the board meeting at which the JS Group planned to seek the ouster of Qureshi as CEO of Al-Abbas. In a letter dated March 12, the SECP replied saying that they would not be able to send an observer, but asked the JS Group to send evidence of wrongdoing. By that time, JSCL had already filed a lawsuit against Osman and Qureshi.
That lawsuit received wide coverage in several leading Urdu newspapers, including the Daily Express, which reported it on March 15. Soon afterwards, Osman appears to have struck back the JS Group by raising the issue of the bonus paid to Ali Jahangir, through a story in Pakistan Today.
In a written statement, JSCL spokesperson Imran Sheikh clarified that the advisory fee paid to Ali Jahangir was a bonus for successfully concluding the sale of the company’s 21.1% stake in Pakistan International Container Terminal to the Manila-based International Container Terminal Services. That sale netted JSCL a capital gain of Rs2.5 billion, of which about 17.6% was paid to Ali Jahangir, who had been managing the transaction.
“The advisory fee has been appropriately disclosed in the annual report of 2012,” said the statement, a fact not denied by Osman since he cited the notes of the annual report to make the allegations against JSCL.
Ali Jahangir’s bonus appears high by Pakistani standards, but sources close to the company say that JSCL tends to follow compensation practises similar to those at international investment banks, which can pay out as much as 20% of the profits generated for the company as a bonus to the employee that brought in the revenue.
Given the volatile nature of capital markets, most investment banks tend to pay most of their compensation not in the form of a fixed salary, but as bonuses that depend on performance and market conditions. In good market conditions, such as present times, bonuses of more than Rs100 million are not unheard of for some of the JS Group’s senior-most executives. In lean times, the reverse is true: no bonuses are paid at all.
Nonetheless, sources familiar with the matter say that the Securities & Exchanges Commission of Pakistan has sent a letter on Monday to JSCL CEO Suleman Lalani, asking him to provide details about bonus, as well as its approval from the board of directors. The letter appears to be in response to a complaint that Osman filed with the SECP on Friday.
Rebellion in India
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Maoist insurgents in India–More bloody and defiant. To overcome Naxalite rebels, India’s government needs to be more adept at both using force and spreading development.
AS INDIA’S Maoist rebellion deepens and grows, so too do divisions in the government over how it should be confronted. Nearly 800 people have been killed in the insurgency so far this year, close to the total for the whole of 2009–a record year for bloodshed in this conflict. The lack of a unified government response suggests this grim trajectory will continue.
On July 17th Digvijay Singh, general secretary of the ruling Congress Party, used a television interview to defend criticisms he had made earlier in print, accusing the home minister, Palaniappan Chidambaram, of mishandling the rebellion. He had written that it is wrong to treat the insurgency “purely as a law and order problem”; instead the government must “take into consideration the people living in the affected area who ultimately matter”.
This disagreement, between two senior government leaders, echoes a wider debate about how to battle the Naxalites, as the Maoists are also known because of their roots in a 1967 peasant uprising in the West Bengali village of Naxalbari. One view holds that the rebels are a military threat and the priority is to quash them by force. The other argues that the Naxalites feed on the grievances of impoverished tribal inhabitants in eastern and central India, and will only fade when development is brought to such areas.
The difference in emphasis matters, but in fact disagreement is much greater outside of the government than within it. A comprehensive response—which combines both security and development—is the best of all. Thus on July 14th, the government said that it is setting up a “unified command” structure to oversee state-level efforts to fight against the rebels, using the expertise of a former army general, and increased army logistical support and helicopters. But it also announced there would be more cash for development projects in Maoist-dominated areas.
The government has so far failed to combine the twin requirements of force and development to produce a successful strategy. “There’s still no consensual policy, no clarity,” says Ajay Sahni of the Institute for Conflict Management, a think-tank in Delhi, commenting on the government plan. The battle against the rebels is being fought by an overstretched, ineffectual police force that has allowed the Maoists to spread from an estimated 56 of India’s 626 districts in 2001 to more than 200 today. The growth of the rebels, who today number 10,000-20,000, with countless thousands of village militias, has been aided by the 2004 merger of the country’s two main communist groups. In addition, speedy economic growth in the eastern states, especially in the mining industry, has given the rebels new targets for raising funds by extorting cash.
Late last year the government sent in thousands of federal police in an offensive across the worst-affected states: Chhattisgarh, Jharkhand, Orissa and West Bengal. No notable improvement in the campaign followed. Instead, in recent months, Maoist violence has escalated sharply. This month 27 police were slaughtered in Chhattisgarh. In May Maoists were blamed for derailing a passenger train, killing at least 145 people. After reports of Maoist threats to their lives this month, the personal security of two high-ranking ministers was increased. The threats followed the killing by security forces of a leading Naxalite, Cherkuri Rajkumar, also known as Azad, in the southern state of Andhra Pradesh on July 2nd.
Politicians are so alive to the Maoist threat that when a train crashed in West Bengal on July 19th, killing at least 63 people, the railway minister, Mamata Banerjee, was quick to finger the rebels as suspects. In fact, the driver apparently ignored stop signals and failed to apply his brakes.
Increasingly, the insurgency is hampering efforts to open up east India’s mineral-rich forests to business. In particular, the rebel fondness for attacking railways and roads has made it difficult for some companies to operate. Work on a $7 billion steel plant by JSW Steel, India’s third-largest steel producer, has been delayed in West Bengal, as have steel projects by Tata Steel and Essar in Chhattisgarh. In June India’s coal minister, Sriprakash Jaiswal, said the threat of Naxalite attacks was substantially curbing coal production. Land conflicts between big companies and local people have done much to boost the appeal of the Naxalites.
The popularity of the Naxalites might yet diminish if people in rebel areas got more basic amenities such as roads, water and schools. The southern state of Andhra Pradesh has had great success in weakening Maoism with a combination of better development and policing. The state’s anti-Naxalite police have been better trained, paid and armed than forces elsewhere. Recruiting more police from the local communities who are familiar with the often difficult jungle terrain of Maoist areas would also help, rather than importing men who do not even understand the language of those they are fighting against.
Elsewhere, however, such measures have been slow in coming. A year ago police launched a big campaign in Lalgarh, West Bengal, to recapture the area from Maoist rebels. Today the rebels are still present, perhaps in part because public investment that was promised has not come as quickly as many had expected. Amitava Rath, a local journalist, points out that the support for the rebels is strongest in those villages with the fewest amenities. “The rebels have started carrying out some development work as if they are already running a state within the state,” he says.
Switzerland best place to be born in; India a lowly 66th - Economic Times
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The tourist paradise of Switzerland has emerged as the best place to be born in 2013, in a new global survey that ranks India among the last 15 nations a baby should start a life in.
The violence hit oil-rich African nation of Nigeria was rated as the worst place to be born in in the survey of 80 states that saw Nordic countries like Norway (3), Sweden (4) and Denmark (5) notch the top slots, along with Australia which was ranked as the second best.
Singapore, New Zealand, Netherlands, Canada, Hong Kong completed the top 10.
The survey conducted by the Economist Intelligence, a sister company of The Economist, used 11 statistically significant indicators, including geography, demography, social and cultural characteristics, public policy, the state of the world economy and future income per head to arrive at its rankings, a report in the Daily Mail said.
While none of the economically emerging BRIC countries scored impressively in the survey, India and Russia were by far the worst placed at the 66th and 72nd spot respectively.
Brazil was ranked in the middle of the chart at 37, China was placed at 49, while South Africa was ranked 53.
The impacts of the economic crisis clearly visible, the survey also saw the crisis-ridden economic powerhouses of the Eurozone as well as the US and Britain lose their standings in the table.
As against a similar survey 25 years back when the US was ranked as the best place to be born in, the world's only superpower is now ranked 16th, just ahead of the UAE and South Korea.
Britain is ranked 27th, behind the likes of Taiwan (14), Kuwait (22) and Chile (23), well down the 7th place it achieved in 1988. France that was ranked second in 1988 dropped to 26th.
While the top ranked Switzerland, which jumped from the 13th place in 1988, scored 8.22 on a scale of 10, the last ranked Nigeria scored 4.74.
"There is surely a lot to be said for boring stability in today's (and no doubt tomorrow's) uncertain times," the Economist magazine said branding the survey as 'deadly serious'.
The league table "earnestly attempts to measure which country will provide the best opportunities for a healthy, safe and prosperous life in the years ahead", The Economist said.
THIS IS INDIA!
The survey conducted by the Economist Intelligence, a sister company of The Economist, used 11 statistically significant indicators, including geography, demography, social and cultural characteristics, public policy, the state of the world economy and future income per head to arrive at its rankings, a report in the Daily Mail said.
While none of the economically emerging BRIC countries scored impressively in the survey, India and Russia were by far the worst placed at the 66th and 72nd spot respectively.
Brazil was ranked in the middle of the chart at 37, China was placed at 49, while South Africa was ranked 53.
The impacts of the economic crisis clearly visible, the survey also saw the crisis-ridden economic powerhouses of the Eurozone as well as the US and Britain lose their standings in the table.
As against a similar survey 25 years back when the US was ranked as the best place to be born in, the world's only superpower is now ranked 16th, just ahead of the UAE and South Korea.
Britain is ranked 27th, behind the likes of Taiwan (14), Kuwait (22) and Chile (23), well down the 7th place it achieved in 1988. France that was ranked second in 1988 dropped to 26th.
While the top ranked Switzerland, which jumped from the 13th place in 1988, scored 8.22 on a scale of 10, the last ranked Nigeria scored 4.74.
"There is surely a lot to be said for boring stability in today's (and no doubt tomorrow's) uncertain times," the Economist magazine said branding the survey as 'deadly serious'.
The league table "earnestly attempts to measure which country will provide the best opportunities for a healthy, safe and prosperous life in the years ahead", The Economist said.
THIS IS INDIA!
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