NAB unearths Rs 40bn scam in KP govt contracts

Anti-graft watchdog finds dumper driver’s bank accounts holding approximately Rs4.5bn

Shamim Shahid

PESHAWAR: The National Accountability Bureau (NAB) has unearthed a whopping Rs40 billion scam in the Khyber Pakhtunkhwa government’s accounts concerning misappropriation of funds.

As the staggering amount continues to rise as investigations unfold, the ongoing investigations have led the authorities to freeze nearly 50 bank accounts and seize records from various government departments and financial institutions.

During the probe, a startling revelation emerged as a dumper driver’s bank accounts were found holding approximately Rs4.5 billion, which was immediately frozen by NAB.

The driver had set up a fake construction company. Evidence revealed that a total of nearly Rs7 billion had been deposited into his accounts through suspicious transactions. Initial investigations also uncovered the issuance of nearly 1,000 fake cheques from the district’s government accounts, with 50 account holders identified so far.

Evidence increasingly points to the involvement of influential political figures and senior government officials at the provincial level.

Sources said the inquiry began after the NAB Chairman received credible information about massive financial irregularities in Upper Kohistan. Despite an annual developmental budget of only Rs500 million to Rs1.5 billion, nearly Rs40 billion were misappropriated from government accounts over five years (2020 to 2024) — a figure far exceeding decades of the district’s developmental grants.

The sophisticated fraud has astonished even seasoned NAB investigators. As per details Rs40 billion were embezzled from the provincial government bank account titled Security and Deposit Works KP 10113 under the pretence of contractor securities. This account, meant for development projects, contractor securities, and payments, was manipulated through forged documents, inflated bills, and fake securities. So far, the inquiry has found that approximately Rs40 billion were withdrawn in an organised fashion, in blatant violation of KP’s financial system.

The highly complex and multi-layered fraud involved the Communication and Works (C&W) Department, Upper Kohistan, which prepared fake security refunds, fabricated records, inflated project costs, and approved fictitious contractor securities, flouting all regulations, exaggerated project costs, and issued fake securities.

The District Accounts Officer (DAO) of Upper Kohistan approved unauthorised payments in blatant violation of the General Financial Rules (GFR) and Treasury Rules. Private contractors, in collusion with government officials, submitted fake bills for non-existent projects, while some employees of a bank in Dassu, Upper Kohistan, unlawfully transferred government funds to private accounts, flouting State Bank of Pakistan regulations and anti-money laundering laws.