Closing down any company and throwing its top management in prison without formal investigations, trial or conviction is not possible in any civilised country around the world. But in Prime Minister Nawaz Sharif’s Pakistan, this can happen with any business concern if it is on the wrong side of the ruling family, their friends and business or political allies.
Axact was targeted just to silence the Bol Media Group’s news and entertainment channels.
One of the biggest scandals in Prime Minister Nawaz Sharif’s third stint in power is the forcible closure of the country’s leading IT company, Axact, which employed more than 5,000 people — many of them among the brightest stars of the world of information technolo- gy, marketing, sales and human resource.
The government’s biased and high-handed action — executed through the Federal Investigation Agency (FIA) in May 2015 — did not stop at Axact’s closure, freezing of its bank accounts and putting its owners and senior management officials in jail. The government went further and stopped the launch of the BOL news and entertainment channels — Pakistan’s biggest media setup — when it used the information and interior ministries and the Pakistan Electronic Media Regulatory Authority to suspend their licences in September 2015.
The closure of BOL’s channels forced more than 2,000 media employees out of their jobs. The BOL Media Group’s planned launch of English and Urdu-language dailies and other media arms also had to be shelved because the closure of bank accounts created a liquidity crunch.
It is now widely known that Axact – established in 1997 — was targeted just to silence the BOL Media Group’s news and entertainment channels. Why did the PML-N government act the way it did — flouting, abusing and trampling laws in the name of the law to close down Axact and the BOL Media Group? The reasons are hardly a secret.
The Sharif government did all this to oblige its allied media — specially a particular group known for spinning propaganda against Pakistan’s key security institutions and acting in league with hostile foreign powers, including India, to undermine the state. By curbing and muzzling BOL, the government wants to help its media allies maintain hegemony on the market and the national narrative.
The pretext the PML-N government used to target Axact and BOL was the fabricated charges made by a US publication, The New York Times, in its May 17, 2015 issue; the report alleged that the Pakistani IT company operated a racket of fake degrees. But it took 10 long months for the FIA just to submit the final charges, which were the same as mentioned in the interim challan.
More than one year down the road, a formal trial has yet to start as the case is being dragged on by the prosecution, which till the filing of this report had sought more than 50 adjournments under one flimsy pretext or the other. The Axact management, which denies operating any business of what the NYT calls fake degrees, challenges whether the alleged crime the company management stands accused of committing can be described a crime under any Pakistani law. Providing back-end education services and educational platforms to institutions is a legal business not just in Pakistan, but the world over.
“Going by what happened with Axact on the basis of a fabricated and biased foreign publication report, Sharif, his two sons and daughter should have been in prison long ago given the magnitude of Panama scandal”
Going by what happened with Axact on the basis of a fabricated and biased foreign publication report, Sharif, his two sons and daughter should have been in prison long ago with all their business and bank accounts frozen — given the magnitude of Panama scandal, which is based not on a mere newspaper report, but on authentic leaked documents and information matching an FIA inquiry conducted against the ruling family way back in the mid-1990s.
After all, money laundering, evading taxes, stealing from the national exchequer through loan defaults and kickbacks, and abusing official positions for personal business gains are far graver crimes than the alleged business of fake degrees. But Sharif and his one major media ally — accused of such scandalous crimes — are happily ruling Pakistan, setting a biased narrative, hurting the country and openly doing businesses here and abroad. Under Nawaz Sharif’s rule, it is the innocent who often gets punished while the politically-connected manage to escape justice.
In Pakistan’s entire history, there has been no such example where a vibrant and socially responsible corporate entity and its media arm have been destroyed in such a manner.
This underlines the prevailing lawlessness in our system, which can silence and punish any individual, group or organisation at the mere whim of the executive authority. Pakistan’s judicial system is too slow and powerless to safeguard the basic rights of citizens in a swift and timely manner, especially when the executive authorities lead the victimisation drive.
The message our so-called pro-business prime minister gave to foreign and local investors is: either cut a deal with the ruling family and its clique or be ready to get hounded and victimised.
The way the interior ministry and the FIA went into action against Axact and Bol within hours of the publication of the false NYT report speaks volumes of how the conspiracy was hatched in advance. The PML-N government moved with unprecedented haste, as if on cue, to close down Axact’s operations. The FIA closed Axact’s Islamabad offices within 12 hours of the publication of the report and within 48 hours, it seized and occupied its head offices in Karachi.
The company’s entire records, computers, servers, valuables and even belongings of the staff kept in the office were seized; and they remain in the FIA’s possession to date. By May 26, 2015 Axact’s bank accounts were frozen and top management, including Chairman Shoaib Ahmed Shaikh and Chief Operating Officer Viqas Atiq were arrested without formal charges. Since then, the FIA and its lawyers have been dragging the case at the behest of political bosses who want to block the launch of the Bol channels by targeting Axact.
The FIA officials continue to occupy Axact head offices in Karachi and Islamabad in the name of a never-ending inquiry. Now the Supreme Court in its directives of May 4, 2016 has asked the FIA to vacate them in a month’s time. It is strange that the FIA was unable to glean data out of Axact servers and computers more than a year after taking them into their custody. This job should not have taken more than a few hours — or at the maximum a couple of days. Is this slowness of the FIA illustrative of a lack of professionalism and expertise or does it expose a biased approach?
Apart from FIA, other government departments and ministries also moved against Axact and Bol without any inquiry, trial or conviction. The following one-sided and highly discriminatory actions were taken within less than a week of the publishing of the NYT report.
Within three to four days of the publication of the false report, the IT ministry suspended Axact’s call centre licence. Why? On what ground? Perhaps these are irrelevant questions under the Nawaz Sharif government.
- Within three to four days, Axact’s software registration was also suspended – again without any charge-sheet.
- Within six to seven days, the FBR issued demand notices to Axact without taking into account that it conducted four audits of the company in recent years. Moreover, Axact on average paid Rs 50 million monthly just as withholding taxes.
- Pemra suspended licences of Bol channels illegally and in violation of the high court order, barring the regulator from any such move.
- Within days, the customs department also launched an unprecedented victimisation drive against Bol, demanding receipts of its equipment despite the fact that the FIA had seized all the records.
These steps were taken as the Axact and Bol Group’s founder and CEO Shoaib Ahmed Shaikh and Co-founder and COO Viqas Attiq languished in prison.
The FIA’s mala fide intentions can be gauged from the fact that in one FIR, Axact owners have been accused of bringing in foreign exchange through official banking channels by selling alleged fake degrees, while in another they have been accused of transferring Rs170 million abroad through a money changer.
This bizarre allegation exposes the contradiction of the FIA’s cooked-up cases. Officially, the export-oriented businesses are allowed to repatriate one-third of foreign exchange earnings abroad. It makes no sense for Axact owners — who used to bring millions of dollar worth foreign exchange in the country — to illegally transfer this small amount abroad. The bias of the officials of FIA — a federal agency — can also be seen from the fact that they filed separate cases in Karachi and Islamabad under the same charges.
A Bogus Case of ‘Fake Degrees
Axact stands accused of running a ‘racket of fake degrees’, though it only provided back-end education services and platforms to its clients. That is why the FIA lawyers are unable to press charges against Axact despite more than one year having passed:
- To date no university or educational institution has claimed that Axact printed fake degrees with their name.
- To date no one has come forward to claim that Axact sold a fake degree to him/her.
- To date the FIA has not presented any evidence in the court.
- To date no Pakistani law says that providing back-end educationalservices or virtual education is a crime.
In a bid to harass Axact owners, the names of the women of the family were also included in the FIRs, though they had nothing to do with company operations. The PML-N government’s victimisation drive against Axact and the Bol Group came as a blow for business sentiment, raising questions about Pakistan’s business climate. By targeting Pakistan’s biggest IT company — which had 65 percent share of Pakistan’s IT exports — the government hurt one of the most vibrant sector of the economy, with the highest growth potential. Now the IT business handled by Axact has moved to other regional countries, especially India.
The way the interior ministry and the FIA went into action against Axact and Bol within hours of the publication of the false NYT report speaks volumes of how the conspiracy was hatched in advance
The Sharif government also made nearly 8,000 people jobless by closing down the two companies, while also depriving Pakistan of millions of dollars’ worth of foreign exchange earnings which Axact brought into the country. The illegal closure of Axact and Bol is among the top mega scandals in the growing list of crimes committed by Prime Minister Nawaz Sharif’s government, in the garb of accountability and justice. But is this dream of accountability and justice in the realm of reality when a Panama-tainted prime minister runs the show? That is what we ask.