Probe finds fraud in Islamabad's One Constitution Avenue project
The government says investors will get refunds with KIBOR-linked interest, and the project's developer and several officials are named.
A Joint Investigation Team report has found serious irregularities, manipulation and fraud in Islamabad's One Constitution Avenue project, the state broadcaster Radio Pakistan reported on Wednesday.
Planning Minister Ahsan Iqbal presented the findings at a news conference in Islamabad alongside Information Minister Attaullah Tarar and Interior Minister of State Talal Chaudhry.
Iqbal said the team included representatives of the National Accountability Bureau, the Federal Investigation Agency, the Federal Board of Revenue, the Securities and Exchange Commission of Pakistan, the Intelligence Bureau and the Inter-Services Intelligence.
He said the team submitted its report to the federal cabinet, which approved its recommendations.
Iqbal said the bidding and auction processes were manipulated, rules were relaxed to favour a particular party, and the company that was awarded the lease was not eligible for it.
He said the Capital Development Authority was also involved in the irregularities, and that the requirement for a bank guarantee was removed to benefit the developer.
Apartments were sold illegally even though the project had originally been approved as a five-star hotel, the minister's account said.
Iqbal said the team identified Abdul Hafeez Sheikh as the mastermind of the scheme, along with several Capital Development Authority officials, including a former chairman.
He said the irregularities caused losses to the national exchequer, and that several Pakistani citizens were defrauded of their savings.
The team recommended blacklisting Sheikh and his company from future public-sector projects and starting legal action against those responsible.
It also recommended reviewing the project, restoring it to its original purpose and holding a fresh, transparent auction.
Iqbal said the government had decided to compensate affected investors by refunding their principal amounts with interest calculated under the KIBOR rate.
The team further proposed renaming the project, obtaining all necessary security clearances and ensuring fire safety protocols.
It also recommended reviewing the Capital Development Authority Ordinance and setting up an independent Master Plan Commission to strengthen oversight.
Iqbal said the National Accountability Bureau has been directed to investigate everyone named in the report and act against those found responsible.
