Pakistan in for expensive legal fight with UBL’s London branch over payment to Broadsheet

LONDON/ISLAMABAD, (MANEND NEWS): Pakistan’s Ministry of Foreign Affairs is planning to get into an expensive legal fight with the United Bank Limited’s UK branch for debiting nearly $29 million to the accounts of the Broadsheet LLC as the huge fallout of Pakistan’s total loss of $65 million in the case starts to roll out and the state of Pakistan takes stock of monumental mistakes in the course of two decades, The News reported on Sunday.

Papers available with these correspondents show that the Ministry of Foreign Affairs has taken off its hands, suggesting that it was not in the loop while multi-million dollar cases were being fought in the UK.

The government of Pakistan has decided to launch action against the UBL’s London branch for the “breach of trust, unauthorised debit of accounts and becoming Third Party without informing its client (Pakistan High Commission in London”, according to the minutes of an inter-ministerial meeting held at the Ministry of Foreign Affairs under the chairmanship of the special secretary (Europe) where several decisions about the Broadsheet saga were taken.

It was decided at the meeting that “the accounts of the Pakistan High Commission would be shifted from the UBL UK to some other bank and the National Accountability Bureau would remit the remaining amount (about $0.235 million) to the Pakistan High Commission at the earliest”.

According to the meeting minutes, details of the court proceedings, including the detailed judgment, would be shared with the Ministry of Foreign Affairs, indicating that the Foreign Office had no idea what had been happening.

Another set of papers available with these reporters show that the National Assembly Secretariat has scheduled a meeting on January 18 in the parliament house to discuss the Broadsheet vs NAB issue. The parliamentarians will be briefed on “the British court’s order to debit Rs450 crore from the accounts of the Pakistan High Commission London over non-payment of penalty by the NAB to the foreign assets recovery firm Broadsheet LLC and the British court’s denial of Pakistan’s claim to 35 million pounds in the Nizam of Hyderabad case”.

The London High Court’s Financial Division had issued on December 17 a Final Third Party Order for payment to the Broadsheet LLC by December 30, 2020. The Foreign Ministry wanted to get into a legal fight with the UBL, but the bank had no choice as not paying to the Broadsheet LLC would have led to the contempt of court order against the bank, possible cancellation of the license and negative ratings.

After the order was made, the Pakistan High Commission (PHC) threatened that it will stop doing business with the UBL if it made payment to the Broadsheet.

The bank had asked the Pakistan government to “facilitate the payment of $28,706,533.34 as in case of non receipt of written payment instructions by December 30, 2020, the bank will have no choice to proceed with unilateral debiting of the accounts of the Pakistan High Commission to meet the payment amount as stipulated in the court order.”

In response, the PHC wrote to the UBL, conveying that any attempt by the bank to unilaterally debit the account of the Pakistan High Commission to meet the payment amount, without instructions, would be a violation of the international law and a breach of trust and will have impact on our future relationship with the UBL.”

A source at the bank said that it will fight any challenge from the Pakistan High Commission. In December 2019, the London High Court ordered the government of Pakistan to pay nearly £6 million in legal costs after the court’s decision which ruled in favour of Nizam of Hyderabad’s descendants, granting them right over £35 million funds and refusing Pakistan’s claim on the money.

The NAB spokesperson, when contacted, said that Broadsheet issue had nothing to do with Bureau’s current administration and chairman. The spokesperson said that the current NAB chairman after assuming office placed the Broadsheet related subject with the federal government which formed a committee that would decide dues and payments if applicable. All payments were authorised by the Government of Pakistan, the spokesperson claimed.

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