Despite suspension, Zafar Hijazi receives Rs 7.733mn from SECP: AG office

SECP paid this amounts to Hijazi after receiving direction from Ishaq Dar

KARACHI: The auditors from Auditor General (AG) office of Pakistan raised serious objection on the payment of salary and other perks worth Rs 7.733 million to Zafar Hijazi, former Chairman of Securities and Exchange Commission of Pakistan (SECP) after his arrest and indictment in record tempering case in June 2017.

SECP also paid an amount of Rs 2.7 million as fixed bonus and Rs 100,000 annual increment to the suspended Chairman during the year 2016-17, the report said.

As per record examined by the auditors, Hijazi was paid hefty salary and perks from June to December 2017 till completion of his tenure.

In addition, he was disbursed full amount of terminal benefits amounting to about Rs 7.733 million, the audit report said. However, the sources said that SECP paid these amounts to Mr Hijazi after receiving direction from Ishaq Dar Ex-Finance Minister.

Hijazi was jobless for over a decade before becoming the Chairman of SECP. After becoming the chairman, the sources claimed that he made assets worth Rs 100 million. The documents shows that he has a plot in C.D.A Park Enclave of one Canal worth Rs 35 million and investment in the mutual fund worth Rs 40 million including in NIT.

According to the documents, the SECP Human Resource Manual 2015, “in case an employee placed under suspension is honorably acquitted of the charges by the Commission, he/she shall be reinstated in service and his period of suspension, will be regularized by treating the period of suspension as duty for all purposes.

The employee under suspension for the provisions of this sub- clause shall be entitled to pay, allowances and other benefits as admissible to him on duty. Provided that the Commission may decide to withheld pay to an employee accused of any gross misconduct/criminal offence especially in cases where such an employee is absconder/absent from duty.

Audit observed that the SECP paid an amount of Rs 7.733 million as terminal benefit to the suspended Chairman as final settlement without acquittal of the charges and reinstating in service. Criminal case against the chairman was in the court of law but the Commission as per rule did not withhold.

Auditors were of the view that payment of terminal benefits without acquittal and reinstatement of the employees was irregular and unauthorized.

The management replied that the Commission in its 82^nd meeting held on December 21, 2017 considered the matter regarding completion of tenure of Zafar-ul-Haq Hijazi (in terms of a detailed working paper) and entitlement of his terminal benefits (in view of status/position in his case i.e. suspension during tenure/on-going court case) and decided that HR department may seek external legal opinion in the matter of payment of terminal benefits to Hijazi from CKR Zia (legal consultants) and further that on receipt of external opinion the same be shared with Ministry of Finance for information/advice.

The Commission in its 11th meeting dated 1st March, 2018 granted approval to release payment benefits to Zafar Hijazi, accordingly his final settlement dues were processed and payment of admissible dues was made to him.

Reply was not acceptable because as per SECP HR Manual the Commission may withheld pay to an employee accused of criminal offense. Criminal proceedings are not concluded and the accused is not acquitted from the charges, payment of terminal benefits was irregular and undue benefit, the documents said.

Audit recommends that the matter may be inquired and responsibility should be fixed for this irregularity.