Imran Khan’s Real (ty) “Investments” – Zulfiqar Ali
Editor’s Note: LUBP highlighted these financial irregularities over a year ago Imran Khan’s financial credibility? – by Ahmed Iqbalabadi (10th May, 2011) followed by Some questions about Imran Khan’s PTI NA-USA LLC – by Ahmed Iqbalabadi (13th May, 2011). “The purpose of both the articles was not to taint Imran Khan and his PTI with sweeping statements (like the allegations of PTI-PML N-media-JI-civil society against PPP) like being corrupt, dishonest and unprincipled . Both the articles merely raised questions related to Shaukat Khanum Memorial Trust (that manages the Shaukat Khanum Memorial Hospital) and Pakistan Tehreek-e-Isnaaf’s PTI-USA LLC, registered as a limited liability company in the USA.
In the articles, we did a small review of Shaukat Khanum’s annual audited financial statements for the year 2009 and also questioned the role of PTI-USA LLC in registering protests. Both the articles were written from a financial and logical perspective and raised pertinent questions. The logic was: Shaukat Khanum Memorial Hospital is the proud brainchild of Imran Khan –> It is a successful venture in the country where success is quite limited –> Imran Khan is the Chairman of the Board of Governors of SKMT and we can assume he has significant interest and say in the management of the Trust –> If there is something wrong in the Trust’s working i.e. investment policies as highlighted in the article, then we can ask questions and deserve to get a decent response” (Imran Khan’s financial credibility five months down the road, 9th Nov. 2011).
SKMT is a national asset which would not have been possible without the contributions of PPP and PML N governments of the 1990s. Therefore, the debate around the alleged mismanagement of its funds should not be focussed around the mud slinging campaigns of PML N and PTI. It should critically examine the core issue of funds mismanagement and Zulfiqar Ali’s article asks some more pertainent questions (End Note)
One of the classifications divides narcissism it into Constructive vs. Destructive Narcissism. Self-esteem, perseverance and confidence are necessary to be a leader. But unrealistic fantasies about one’s talents are nothing but destruction. That is what we see in the case of our to-be Messiah IK.
Just few months ago no one would have imagined PTI to be in present pathetic situation. After some rallies, they increased their filthy smear campaign, not thinking things can boomerang. Being continuously promoted as reincarnation of Jinnah, George Washington and living Nelson Mandela( all combined), he/they not only believed themselves but reacted vociferously if someone disagreed with them. Month over month, they continued their dirty name callings and puerile tantrums mixed with fake surveys. On March 19th 2012, he remembered ‘innocent until proven guilty’ while talking about OBL but immediately he reverted to his tirades against Asif Ali Zardari and Nawaz Sharif . When not paid back they, most likely, thought that others did not have anything against their saintly Tsunami. Perhaps, they did not know something about ‘timings’. May be Fouzia Kasuri could have told them what is called “October Surprise” in USA.
It is just second trailer after Benami, and they are wailing like a widow. As previous, his statements about SKMT are also full of lies. Sadly some of PPP leaders have been siding with PTI. PPP needs to ask such leadership to not reflexively condemn everything PML-N does. If their points are valid, then they should, rather, be commended. IK and cohorts have been saying that SKMT has been dragged into politics by PML-N. How can they say it, when his only and only credential presented to people has been this? It is only them to be blame for that. It (with NAMAL) has been his only worth mentioning political ‘investment’ of IK in Pakistan.
Finance is not my field, so these are just layman’s observations. I tried to not to indulge in complicated things. It is possible that my interpretations are wrong. So please correct me in comments sections.
One has absolute right to spend one’s own earnings as may please one. But “Trust” means that society has put some trust in you, which it does not expect to be broken. Trusts are exempted from regular taxes and also get grants from ‘nation’ and other agencies. Simply speaking one is made “ameen”.
It is true and also right that investments are needed for smooth working of trusts. But it is also true that society does not expect speculative investments. Basic and foremost is the choice of investment consultant. Let us try to find who Mr. Imtiaz H Hydari is. His investment genius is also helped by Zulfi Caar Hydari aka Zac Hydari, Arshad Hydari seemingly his sons.
For average person like me, his work experience and ‘resume’ is too extensive. But here is some of his investment profile.
He was CEO of Olayan Group and Saudi based company. One other person with him at Olayan was Arif Naqvi.
On Jan 5th 2002 Rasmala Buyout Fund, through its subsidiary based in Cayman called Rasmala Distribution Ltd., announced 61 Million $ buyout of an express package delivery company called Aramax. This was the very first business of it. They were also partners in a Luxemburg based company Groupe Copula which was subsidiary of The Cupola Group from Dubai. Cupola group’s two top officers were Mr. Imtiaz Hydari and Arif Naqvi.
In 2005 European Islamic Investment Bank (EIIB) was formed and is marketed as Sharia based banking. Currently its executive board consists of Zulfi Caar Hydari and Keith Mcleod. After completing strategic controlling investment earlier, EIIB announced on April 2nd 2012 that it was further expanding the dealings with HBG stating
“Rasmala has a strong asset management platform and we are fully committed to expanding this business across the MENA region….”
Wouldn’t it have been suffice to just say that my dad is the chairman and I myself am co-founder and managing director of HBG?
EIIB has also been losing money since inception. It lost 0.5, 22.0, 5.9 and 14.9 Million GBP in years 2008, 2009, 2010 and 2011 respectively.
HBG’s leadership team consists of
- His Excellency Abdallah Al-Mouallimi Chairman (Non-Executive, not involved in day to day functioning)
- Imtiaz Hydari CEO, Exec Vice Chairman and Board Director
- Zulfi Hydari Co-Founder
HBG being privately held, financial details are not public. But being run by same family, it would be foolish to expect the results otherwise. As I said, “Resume” is too extensive to evaluate in just few days’ time.
Considering all, was it wise to make Mr. Hydari an investment consultant?
IK and Co.’s main defense has been that money invested;
- Was not Zakat.
- Only Endowment Fund which is by donations given specifically for the Fund
- It is guaranteed that SKMT will not incur any loss.
Zakat vs. Non Zakat; it is not only laughable logic but also not true. This is the same thought which many of us may have observed ourselves. Some of us work on positions which are well known for ‘ooper ki kamai’. When we have to make payments for Qurbani, or other charity work etc., we wait for salary, believing that to be Halal.
During his press conference on Aug 1st Imran Khan claimed that the money they from abroad is kept in endowment fund account (5:30).But SMKT financial statements are not in concordance with that.Money has persistently transferred from general fund to Endowment.
Transfer from General Fund to Endowment Fund
| Year | PKR |
| 2007 | ? |
| 2008 | 37,715,028 |
| 2009* | 43,069,416 |
| 2010 | 22,502,441 |
Total 103,286,885
*However General fund took over 41.6 M worth liability from Endowment.
IK later changed his statement saying that 10% of donations (foreign?) are transferred to endowment.
If investments were ‘guaranteed’, then why they are showing losses over the years? More importantly, why they still kept money with the same person? As per their statement they have lost money.
Unrealized Gain/ (Loss) on investments in PKR.
| Year | * |
| 2007 | -(3,612,821) |
| 2008 | -(58,776,859) |
| 2009 | -(1,741,680) |
| 2010 | -(9,295,705) |
Total – (73,427,065)
*Mostly investment is from Endowment, but General Fund also minute investments.
Once I heard IK saying on TV that CEO did not get any salary. It is possible, but unlikely, that I misheard him,. Here are his and other directors’ remunerations.
Remuneration and other payments to
| Year | CEO | Board Directors |
| 2006 | 4,515,000 | 11,711,632 |
| 2007 | 6,800,000 | 14,249,195 |
| 2008 | 6,950,000 | 13,497,738 * |
| 2009 | 7,917,500 | 15,296,571 |
| 2010 | 9,496,175 | 23,204,792 |
*No. of directors was three this year vs. 4 for all others
It included housing, retirement benefits, bonuses, utilities expenses. Free transport to all is provided. CEO is also provided free residence. But every year, he has also been given substantive amounts. In the year 2010 he was paid 2,194,440 (above numbers include this).Maybe he is living outside the hospital premises, but if residence is available, why not to make him use it?
Reports have been audited by A.F. Ferguson, a firm with worldwide operations, as per IK. There are two main concerns about this, however.
A.F. Ferguson is Pakistan based with offices in Karachi, Lahore, Islamabad and Kabul. It is ‘member’ of Pricewaterhousecoopers. It is run by three partners Soli R. Parakh, M. Shahid Sadiq and Shahzad Hussain.
They are honorary auditors. It apparently means that they are not paid and also are not responsible for authenticity of the audit. While general report carries the signature of both Imran Khan and Dr. Faisal Sultan and reports have NO SIGANTURES of either the auditors or management of SKMT. It has no legal value at all.
What about Arif Naqvi? Currently he is Vice Chairman and CEO of Abraaj Capital and Mr. Imtiaz Hydari was one of Abraaj’s co-founder too.
His profile on Abraaj says;
“In 2006, he was awarded the HIGHEST civilian honor in Pakistan, the Sitara-i-Imtiaz, by the Republic’s President.”
Well it is in fact third highest!!!
He seems to very close to IK.IK has attended many functions/fundraisers by Abraaj. Some people have also described him as PTI leader. IK has praised him many a times on TV also. IK was at Abraaj function in Nov. 2010.They were together at Davos this year also. In March 2011, a fund raiser for the flood victims was done by IK (I did not know flood thing was still active).It raised one Million US $.Mr. Naqvi was a major speaker at that event.
It was Abraaj which took over KESC. As per contract it was to invest 350 M $.It invested 150 M. It did not invest next installment in time. On Dubai 3rd 2009, US Dubai Consulate sent a cable to Karachi, Islamabad and Washington. Among other things it contained following
“Mr. Naqvi explained that Abraaj had agreed in 2007 to take over management of the Karachi Electric Supply Company following a negotiation of several pre-conditions with the Government of Pakistan (GOP). One of those pre-conditions was a write-off of 32 billion rupees (which Naqvi lamented has been heavily criticized in the Pakistani press as a kick-back of sorts). In return, Abraaj committed to a USD 360 million investment in KESC over a three year period, of which, Naqvi said, USD 150 million has already been deployed. Naqvi noted that the GOP has asked Abraaj to accelerate its delivery schedule; the company is considering the request now. Abraaj gained a controlling stake in KESC in September 2008……
…He conveyed two points: a) USD 100 million in working capital, allegedly tied up in
receivables, “MUST” be released by the GOP;
and b) the GOP MUST stop fueling the political fire through public calls for KESC’s nationalization…” (Wikileaks)
During Davos of 2010 Mr. Naqvi was mentioned news prominently
“Secretary of State Hillary Clinton, Education Secretary Arne Duncan, Commerce Secretary Gary Locke and other senior U.S. officials will participate in sessions alongside private sector experts like Yahoo! chief executive Jerry Yang, Grameen Bank founder Muhammad Yunus and Arif Naqvi, head of Abraaj Capital, the largest private equity firm in the Middle East.”
http://www.abraaj.com/content/reuters-abraaj-news-obama-fulfills-cairo-pledge-entrepreneur-summit
Sep 05th 2010 news said,
“Abraaj Capital and Citadel Capital and have secured $250m in fund commitments from the US Overseas Private Investment Corporation (OPIC).”
http://www.privateequityafrica.com/funds/abraaj-and-citadel-get-250m-from-opic/
About two months later
“…Abraaj officially launched its Riyada Entrepreneurship Development (RED) fund that will provide $500 million in growth capital to develop early and mid-stage enterprises across 14 growth markets in the region. The U.S. Overseas Private Investment Corporation (OPIC) contributes $150 million to the fund following President Obama’s Cairo speech, in which he announced a fund to develop technology in Muslim-majority countries…”
http://www.nextbillion.net/blogpost.aspx?blogid=2008
Imran Khan was also there at that function.
Is there any connection?
May be Ambassador Munter knows.
Imtiaz Hyderi was a board of governors member of skmt and that is when the screwed up investments were made
ya
Excellent Search based article
He who claimed global recession could have been avoided , IF money is investment according to guidelines and principle of sharia were investing in speculative real estate .
Excellent investigative reporting by Zulfiqar Ali. His report has opened a Pandora box. The salient features of the reports are:
1) General Funds are raised and kept in Pakistan that include donations, zakat, khairat and fitrana. Special Fund Raising occasion are held not only in Pakistan but also abroad. So two type of currencies are deposited in the SKMCH General Fund account as foreign currency and pak rupee bank accounts. SKMT funds accounts may be in different foreign bank a/cs but they ultimately are remitted in the General Fund Account in Pakistan (for the purpose of transparency and examination by auditors).
2) As is practiced legally by the Charitable institutions of the world, out of the total amount accumulated in General Account, a certain amount is permissible to transfer into another account – Endowment Account for the purpose of investment to generate profits for the charitable entity or Trust such that the Trust should run on its own and even expand its services – so far so good.
3) The author has only given total amount (with year-wise breakup) transferred from General Account to Endowment Account (PRs.103,286,885) but has forgotten to mention the total amount (before bifurcation) in the General account. Was the transfer of around 10 Crore to Endowment account was within the legal limitation or did it exceed.
The above has raised many questions and highlighted many contradictions in the statements and speeches made by Imran Khan during his last 4 years of political activities.
1. The General Account is in Pakistan and money transferred to Endowment Account for the purpose of Trust’s profitable investment are maintained in a separate head of account. Hefty amounts have been transferred out of Endownment Fund outside Pakistan and invested in foreign countries. This is the biggest boomerang that hit back Imran Khan and his cronies that have been shouting with full throat against foreign and benami “shaddy deals” allegedly done by Asif Zardari et al and Nawaz Sharif et al. Interestingly the Oman deal of state business investment was done through off-shore company of Imtiaz Hyderi but not to forget in the words of Imran himself such deals are Benami lol.
2. On two strong rebuttals viz. The foreign investment is covered by guarantee and that it was not speculative it was a safe investment, Khawaja Asif has re-raised two solid questions. One, why not in Pakistan, why not in Islamabad estate business the land value whereof are going up every passing day, why in the desert of Oman? Two, is there bank guarantee against this investment? Without bank guarantee the guarantee on a letter-head is a tissue paper. Looks like, Khwaja Asif is telling the undeniable truth. By 2009 it was known to the world that HBG investments have sunk. It is now 2012, and still “guaranteed hefty amount” invested has not been credited back to SMKT Endowment account.
Nobody is questioning the great cause of SMKT. But it does not mean that if something wrong has been done down the system it should not be brought into notice and an explanation not sought for. Every Pakistani has a right to get the explanation. There are huge shouts and lot of name callings in the social media as to why SMKT name is used to defame IK, since SMKT has nothing to do with IK and that SMKT is doing some noble humanitarian jobs. It would have been so, had IK and his lieutenants would not have been bringing the good name of SMKT in public meetings , speeches and talk shows to gain political mileage. If votes are sought for by PTI on two counts – Imran founded the world fame Cancer Hospital and Namal University and that Imran is as clean as a slate, then these august institutions have been politicized by none than Imran Khan himself. Dwellers of glass house do not throw stones on outside gatherings.
I read and still can’t belove that we in Pakistan can write this kind of article, report and valuable comments. Wonderful work, investigation, analysis, well written on the topic.
Now about IK and his political lies, unaccounted funds raised and managed (mismanaged) by him and of his selected friends. He must stop thinking that these funds are His Earnings, so he can handle the money the way he likes, his contribution is there but it is on the name of Allah, for the betterment, treatment of poor people of Pakistan. For this reason and cause people are giving to hospital, i am sure people will not pay him 1% of the current collection if he ask for himself. He knows well but hard for him to obey that under which law he collected from public these funds, and those laws will be applied by the society members from whom he had collected funds.
The confidence deficits created, and bad behavior of these kind of person erode the confidence on the society. And then we blame others of our misdeeds.
Love you all. Kindly keep doing good work.
Wow! how exciting for you guys.
I eagerly await Zulfiqar Ali’s future expose’s of saintly figures like Zardari, Gilani, Sharif’s, Thekedar Malik Riyaz and the Chaudhary’s and how they manage their few visible and numerous hidden business entities, assets and investments.
Even at his worst, IK is small fry. You would gain a lot of credibility if you start exposing the true Robber Barons of Pakistan. Doing so is in your own interest, for they rob, not just the country but all its people including your children and future generations.
Wake up!! Bhutto’s, Zia, Musharraf are all history now. Pakistan is now ours to make or break. Time to ditch the misplaced and thoroughly soiled old loyalties and for once think about how we can repair the country – Do I need to remind you of your slogan “Let Us Build Pakistan”. If you are serious, stop building a coffin for it.
Peace to All !!
In reply to OYE:
First of all, this is not Facebook or Twitter site where anyone, fool or wise, does make comments that are full of calling names, claiming “our leader is angel and the rest are big or small satans”. And when someone raises a finger, he is tried in coercion to just shut up. This happens in fish market where every shopkeeper claims his fish are the best and others have rotten ones. Not too far back ex-President Musharraf threw a few hundred thousands of dollars and what we saw on these two social media – it simply looked to outside world that Mushraff was the most popular leader of Pakistan LoL. But reality bites big time. In real world, people also watched what happened in recent Multan election – no need to repeat it, actions speak louder than words.
This forum is a serious forum where debates are generated on logics and factual arguments. Please keep away the bad childish habit of “you are thief – no, you are thief” on those cheap social media fora referred to above. For the last 15 years or so Imran has been calling his opponents looters and plunderers. Now it is pay back time.
Dear zulfi, I wanna correct u on the 3 figures u quoted from SKMH financial statement.
(i) Transfer from General Fund to Endowment Fund:-
There were no funds transferred from General Funds account to Endowment Fund account, as you claimed here. Infact during 2010, Rs. 9,295,705.00 from endowment fund, were taken for recurring expenditures. Its same for all years u mentioned.
(ii) Unrealized Gain/ (Loss) on investments in PKR:-
Zulfi bhai its not loss, its (Rs. 9,295,705) showing negative bcoz its taken from endowment fund for gen expenses as mentioned above.
(iii) Remuneration and other payments to:-
IK never claimed that CEO is a volunteer, he sued Hanif Abbasi of PMLN for his claim that Memeber of SKMH Board of Governers are being paid. IK, cleared that all theses members are volunteers, not CEO & Full Time Working Directors(who are professionals like
(Dr. M. Aasim Yusuf, Medical Director
Mrs. Virginia A. Gumley, Director Nursing
Mr. Tariq Azam, Director Marketing and Resource Development &
Ms. Tasnim Beg, Chief Financial Officer)
So, there is no issue with these three points u raised. The only issue i can see is conflict of interest, which can be justified when you got the guarantee of no loss on the investment. Otherwise, a third party (another investment company) would never have guaranteed this. Hence, there would have been a big loss to SKMH.