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Offshore companies made to attract foreign investment: Shaukat Tarin

Federal Minister for Finance and Revenue Shaukat Tarin. addressing a press conference. Source: FILE/APP

ISLAMABAD: Finance Minister Shaukat Tarin has responded after he and his family were mentioned in the Pandora Papers for owning offshore companies.

Tarin said the offshore companies were opened with the approval of the State Bank of Pakistan at a time when he was trying to attract investment of a foreign group for his bank.

“In 2014, M E Developers LLC of Tariq bin Laden wanted to invest in Silkbank. They got In Principal approval from the SBP and then opened four offshore accounts to raise structured finance to raise funds,” the finance minister said on Twitter.

He said that there was a law and order problem in Pakistan and the foreign firm decided not to invest, he added. “No bank accounts were opened, no transactions took place and the companies stood closed.”

According to the investigation’s findings, Tarin and his family members own four offshore companies. The report quoted Tariq Fawad Malik, a financial consultant who handled the paperwork for the companies, as saying that they were set up as part of the Tarin family’s intended investment in a bank with a Saudi business.

Speaking to a private channel, Tarin explained that his offshore companies named in the Pandora Papers were established around 2013 or 2014 when he was trying to raise capital for his bank.

Tarin said his offshore companies were created because Tariq Bin Laden’s company Middle East Development had wanted to invest in Silk Bank. The minister said that the State Bank of Pakistan (SBP) was also involved and informed about the foreign company’s willingness to invest in the bank.

He said that the central bank had given principle approval and four offshore companies were created for raising funds. “But no accounts were opened and there were no transactions,” he said, adding that Tariq bin Laden’s company pulled out after a bomb blast in Karachi. “These companies were closed within a year and no bank accounts were opened. Not a single cent went in or came out,” he said.

Tarin said he welcomed Prime Minister Imran Khan’s decision to investigate all citizens mentioned in the Pandora Papers. The finance minister said that he was against tax evasion and had been one of the highest taxpayers in the country. He said that the Federal Board of Revenue (FBR) will investigate the companies named in the investigation.