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Khanani and Kalia laundering
Khanani and Kalia laundering
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Altaf Khanani group, based mostly in Pakistan, was accused of money laundering by the US state department in 2016. Billions of dollars for crime and terrorist related activities have been reportedly laundered by the Khanani’s; a US Report submitted to the Congress last week claimed.

According to William Brownfield, the US Assistant Secretary of State for Bureau of International Narcotics and Law Enforcement Affairs, the 32nd International Narcotics Control Strategy Report had been submitted to the Congress back on last Wednesday, in the first week of March.

“It is, however, the first time that we are discussing and rolling this report out before the media in nine years”, he further explained.

The section on the report for Pakistan outlines that the Altaf Khanani money laundering organisation (Khanani MLO), which is based in Pakistan has been found guilty of being involved in huge cases of money laundering. It is reported that the group has already been in the November 2015 issue of the government’s files.

The regions involved in the racket as reported include: Pakistan, the United Arab Emirates (UAE), United States, UK, Canada, and Australia.

Read more: Ayyan Ali case: Another nail in the coffin of Pakistan’s Criminal justice system

Someone like Khanani, even when big, would ultimately have provided illegal services to the rich, mighty and politically connected criminals. His arrest alone would hardly improve situation in a broader region where top political executives, ministers, Chief ministers, finance ministers, top generals and even prime ministers have been accused of mega corruption scams.

The report further states that the Khanani group, “is responsible for laundering billions of dollars in organised crime proceeds annually. The Khanani MLO offers money laundering services to a diverse clientele, including Chinese, Colombian, and Mexican organised crime groups and individuals associated with designated terrorist organisations”. The report further notes that Pakistan’s border connecting to Afghanistan, Iran and China plays a vital role in the process of money laundering as there is no proper monitoring of the borders. Similarly, it also highlights the current situation of Pakistan labeling it as a country where corruption and tax evasion are a serious problem.

“There is a substantial demand for money laundering and illicit financial services due to the country’s black market economy and challenging security environment.” – Report.

While the report emphasizes on the money laundering case, it also acknowledges that the Pakistani’s have followed the legal framework of sending money overseas. Nevertheless, the report also outlines that the “Unlicensed hawala/hundi operators are also common throughout the broader region and are widely used to transfer and launder illicit money through neighbouring countries”.

The charitable sector of the economy is also being manipulated by the criminals involved in money laundering. The report further explains that the National Action Plan (NAP) carried out by the government of Pakistan to deal with the terrorist financing has produced “mixed results”. 

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Yet media reports regularly that mighty corrupt use high value couriers and motor boats, of the coast of Arabian sea, to physically launder their ill-gotten billions. Laws exist on statute books that allow super rich to hide their ill-gotten wealth under agricultural income or to launder it through “hawala” and then bring it back. Unless US authorities focus on this broader issue, arrest of small fries in the chain like Khanani would only create headlines – but no real improvement.

“Unlicensed hawaladars continue to operate illegally throughout Pakistan, particularly in Peshawar and Karachi, though under the NAP Pakistan has reportedly been pursuing illegal hawala/hundi dealers and exchange houses,” the report adds.The report also says that the Pakistan’s Federal Investigation Agency does not hold the capacity of efficient handling of the large financial investigations. Khanani was arrested back in September last year and had hence, signed a plea agreement to the US courts in October 2016. The guilty, was brought to the US District Court of the Southern District of Florida based on 14 counts of money laundering since June 2015.

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Top Politicians accused of corruption & money laundering

But the mere arrest and conviction of a Karachi businessman, by US authorities may be a cosmetic measure. Someone like Khanani, even when big, would ultimately have provided illegal services to the rich, mighty and politically connected criminals. His arrest alone would hardly improve situation in a broader region where top political executives, ministers, Chief ministers, finance ministers, top generals and even prime ministers have been accused of mega corruption scams.

Read Also: Sharifs used paper mill to whiten money, Dar told court in 2000 – Dawn

Financial laws and regulations, since 9/11, have been made very strict, in the region, for the common man; small businessmen find it increasingly difficult to conduct normal financial transactions. Increase in strict regulations have further empowered the corrupt bureaucracies in the region who hound all those businessmen who are connected at the top. Yet media reports regularly that mighty corrupt use high value couriers and motor boats, of the coast of Arabian sea, to physically launder their ill-gotten billions. Laws exist on statute books that allow super rich to hide their ill-gotten wealth under agricultural income or to launder it through “hawala” and then bring it back. Unless US authorities focus on this broader issue, arrest of small fries in the chain like Khanani would only create headlines – but no real improvement.

Read Also: Court Indicts Ayyan Ali in Money laundering case -The Nation

Khanani was one of the four guilty’s blacklisted by the US law enforcement department in October. Among the others, Obaid Khanani, his son was also identified. The US Department of Treasury said that apart from Obaid Khanani, Hozaifa who is 29 and nephew to Altaf Khanani, was also found involved.

The report also explained that Javed Khanani, Altaf Khanani’s brother, was also “heavily involved in laundering criminal proceeds via money service businesses”. 

The fourth man was Atif Polani, who was playing his part by moving funds on behalf of the Khanani’s organisation.

The Director of Khanani and Kalia International (KKI) died falling from an under-construction building in Karachi, in December 2016.

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