A naturalized U.S. citizen named in a $10 million bank fraud scheme in his native country of Pakistan faces torture or assassination if the United States does not resist a pending extradition request, his attorney says in an appeal to the U.S. State Department that charges the case lacks evidence and is politically motivated.
Pointing to official bank audits, statements, board minutes and court documents, lawyer Stuart Sears said this week in a letter to State Department legal adviser Patricia McDonough that his client, former Bank of Punjab President Hamesh Khan, actually took steps to protect the bank.
“Through their extradition request, the reach of Mr. Khan’s political enemies in Pakistan has now extended beyond the Pakistani border and into the United States,” Mr. Sears wrote.
Mr. Sears, in the letter, said documents show that the bank’s board approved questionable loans without Mr. Khan’s approval while he was on vacation and that once he returned and learned of them, he cut the lines of credit and imposed harsh conditions on the loans - which already had been disbursed.
“It is inconceivable that Mr. Khan would cut the very loan he allegedly was bribed to increase, let alone call for stricter auditing of the … accounts,” Mr. Sears wrote.
On Thursday, the State Department referred questions on the case to the U.S. Justice Department, which did not return a call for comment.
Then-Pakistani President Pervez Musharraf approved Mr. Khan as president of the Bank of Punjab in 2003, after which Mr. Khan led a turnaround of the troubled institution and became a rising star in Pakistan. When Mr. Musharraf was forced to resign in 2008, Mr. Khan said, his opponents asked him to publicly accuse the former regime of criminal behavior.
As those same opponents rose to power, Mr. Khan said, they also asked him to approve unsecured loans to their family’s sugar business. He said when he refused, he was told his refusal could lead to “unsavory” and “dire” circumstances for his “life and career.”
Mr. Khan left Pakistan in May 2008 on the advice of Pakistani law enforcement authorities and State Department officials Bryan Hunt and Michael Chang, Mr. Sears said in the letter. The former bank president was hired in February 2009 by the U.S. Agriculture Department and was arrested in his Washington, D.C., office in December after he was charged with forgery and fraud in Pakistan.
The case against Mr. Khan concerns more than 20 loans totaling $10 million that his bank approved to the director of Haris Steel Industries in 2006. The director, Sheik Muhammad Afzal, later told prosecutors in Pakistan that Mr. Khan was a co-conspirator who sought to thwart the investigation once the fraud was revealed.
But Mr. Sears wrote that Mr. Khan took steps to protect the bank, such as restructuring the loans to ensure repayment, filing a formal complaint with prosecutors against his own employees, and recommending that Mr. Afzal, who has since confessed and returned the money he borrowed, be prohibited from leaving the country.
Mr. Sears, in his letter, said Haris Steel never defaulted on the loans. He also said Mr. Afzal defrauded four other banks but none of those presidents were charged.
Since the case was filed against Mr. Khan, the Pakistan Supreme Court has recommended removal of the lead prosecutor, Danishwar Malik, of the National Accountability Bureau (NAB), a watchdog agency that brought the allegations against Mr. Khan. The court recommended that he be replaced with “persons possessing competence and integrity.”
Mr. Khan’s successor at the Bank of Punjab, who first recommended to the NAB that Mr. Khan be prosecuted, was removed by the Central Bank after just three months for being unqualified.
Shahbaz Sharif, a Musharraf political opponent, is now the chief minister of Punjab, and his brother, Nawaz Sharif, is a former Pakistani prime minister. A 2007 ABC News report said Nawaz Sharif once received a $1 million payoff from Osama bin Laden for not cracking down on the Taliban in militant tribal areas in the northwest province that borders Afghanistan.