Pakistan paid Broadsheet, an asset recovery firm registered in the Isle of Man, Rs4.65bn after the National Accountability Bureau (NAB) broke an agreement with it three years after it was signed in 2000.
After its formation in 1999 by then military dictator Pervez Musharraf, NAB approached Broadsheet to recover overseas assets of at least 200 Pakistanis, particularly the Sharif family. However, the deal fell through in 2003, with NAB saying that the recovery firm had stopped investigations; Broadsheet had accused NAB of hampering its probe to locate the offshore assets of Pakistanis.
The broken accord was the start of an 18-year-long legal battle between the two parties. In 2008, NAB reached a settlement with a former Broadcast LLC official, Jerry James. The bureau paid at least $1.5million to James to settle the case even though the company was being liquidated and the liquidator was not a party to the deal.
Though NAB claimed it had reached a settlement with Broadsheet, the firm said James had nothing to do with it at the time of the signing of the agreement. The money paid to James didn’t reach the original Broadsheet, its CEO had claimed and filed a case in a UK court for arbitration in the matter in 2012.
The UK judge decided the matter in favour of Broadsheet, the claimant. It said Broadsheet LLC was entitled to recover damages for the wrongful repudiation of the ARA [asset recovery agreement]. The award declared that James had no authority from the claimant after March 2005 to enter into a settlement agreement with NAB. The judge said the deal was “wrongful and deliberate to financially hurt the original Broadsheet LLC, Isle of Man”.
The court held that while negotiating with the fraudulent company, NAB representative Ahmer Bilal Soofi was aware that the original company was in liquidation, and he signed the wrongful deal knowingly.
Finally, the court ordered NAB to pay $21.58m plus interest to Broadsheet LLC in damages over the breach of the agreement. Due to interest rates, the award amount reached $28.7 million by December 2020.
According to the judgement, a total of $21.58 million has to be recovered and given to Broadsheet of which $1.5 million had to be recovered from the Sharifs on account of Avenfield flats, $19 million for other assets ($802m worth assets are being attributed to Sharifs); $48,760 from Schon Group; $25,000 from Sultan Lakhani; $85,600 from Fauzi Kazmi; $381,600 from Lt Gen (r) Zahid Ali Akbar; Aftab Sherpao $210,000; and $180,000 from Jamil Ansari.
WHY DID NAB PAY $1.5m MONEY TO JAMES?
NAB deliberately tried to cheat Broadsheet LLC by paying $1.5m to James.
According to the court, NAB made two payments to Jerry James, by then the unauthorized person who had incorporated another Colorado company which he had also named “Broadsheet LLC”. The actual company was Broadsheet LLC, an Isle of Man entity. The arbitration court said NAB tried to financially defraud the original Broadsheet LLC by paying James instead of the original company.
Broadsheet had been in the process of liquidation since 2005. And Moussavi, who now owns the company, offered to rescue it in return for a 50 per cent share from the settlement and James agreed. He, however, went behind Moussavi’s back and made a deal with NAB by registering another company named Broadsheet LLC — based in Colorado. The deal was declared shady by the court that asked NAB to pay damages to the original Broadsheet.