On the 18th of June, police walked into the house of Farhah Mazhar. Save a couple of nervous-eyed servants, the house was empty. The police walked by to the bed room of Farah the place the bedsheets had been modified on a bloodsoaked mattress and a hurried, nervous, cover-up had taken place in a ransacked room. Exterior  within the yard, two firearms had been buried in a shallow ditch. 

Farah herself was at a hospital – being declared lifeless of a gunshot wound to the stomach. Her husband was almost 8,000 miles away in the USA – escaping a monetary fraud investigation of the Nationwide Accountability Bureau (NAB). 

Farhah had been taken to the hospital by her son Fahad Mazhar and a servant. On the hospital, Fahad had informed the medico-legal officer and medical doctors that his mom had dedicated suicide. However as police quickly began to uncover, Farhah Mazhar had not dedicated suicide. She had been murdered – shot in cold-blood by her personal son. Fahad Mazhar had needed to marry their house-maid Razia. An argument along with his mom over the matter had escalated to a scuffle, which within the presence of firearms, had resulted within the gory incident. 

Thus got here to an finish the lifetime of one other of Seth Abid’s kids. Farhah Mazhar was the daughter of the legendary gold smuggler who handed away final 12 months. Greater than a decade-and-a-half in the past, Farah’s brother and the inheritor to Seth Abid’s fortune, Seth Hafiz Ayaz Ahmad, had been gunned down by a lone-wolf safety guard with a vendetta. 

How did this come to be the lot of the household of one of many richest males in Pakistan – a person who was famously as soon as the most important property proprietor in all of Lahore? The tragedy of the home of the Seths is steeped in crime, ardour, and a way of divine judgement that may be befitting of the Bard. And all of it’s entangled on the planet of economic crime and high-stakes smuggling. 

Learn extra: Seth Abid: Pakistan’s ‘pious’ smuggler, mythmaker, and the final of the outlaws

To grasp all of it, we might want to undergo the world of Seth Abid. We might want to journey by the excessive grasses of the Indian border close to Kasur, from the place he bought his begin smuggling gold, all the best way to the excessive seas between the Gulf and the Karachi coast – which he ultimately made his trademark smuggling route. 

However first, we should have a look at occasions nearer to the current. And for that, we’ve to return to 2017, when issues actually began going south for the now murdered Farhah Mazhar and her household. When her husband, Mazhar Rafiq, ran away to the USA with greater than a billion rupees to flee a NAB investigation.

The dealer that broke belief 

We’re going to get to Seth Abid, we promise you. However earlier than we do this, let’s speak a bit in regards to the inventory alternate. In December 2016, one thing occurred to the Pakistan Inventory Alternate (PSX) that the majority Pakistanis didn’t even clock. A Chinese language consortium gained the bid for a 40% stake within the Pakistan Inventory Alternate (PSX) with an quantity of Rs8.96 billion or roughly $85.5 million, translating to Rs 28 per share.

For anybody exterior the ambit of the world of brokerage homes and inventory investments it was a passing piece of reports. For these knee deep on the planet of the inventory market, nevertheless, it meant massive modifications. 

You see, whereas you may make cash off the businesses listed on any given inventory alternate, the inventory alternate itself can be a enterprise. Internationally, the possession of main exchanges is a blended bag starting from publicly-traded corporations to authorities possession. However inventory exchanges often have CEOs, shares, enterprise pursuits, and providers that they provide in alternate for cash. 

Inventory exchanges enable buyers and merchants to generate income by offering them a market for buying and selling securities. In addition they enable corporations to lift cash by itemizing totally different sorts of securities. For offering such providers and market, exchanges acquire transaction charges from market contributors and corporations. Exchanges additionally provide numerous services and products used for buying and selling and associated actions – and so they cost for all of them. 

In Pakistan, whereas it’s tightly regulated by the securities and alternate fee, it is rather a lot run with the aim of profitability. Which means when the Chinese language Conglomerate, which incorporates corporations just like the Shanghai Inventory Alternate, Shenzhen Inventory Alternate, Chinese language Monetary Futures Alternate Firm Restricted, Pak-China Funding Firm and Habib Financial institution Restricted, purchased a managing stake within the PSX, they got here in with the intention of tightening how the PSX ship was run and getting cash off of it. That meant cracking down on the numerous presence of economic crime on the inventory alternate.  

The PSX itself is a comparatively new idea. Up till 2016, inventory buying and selling on Pakistan was carried out on three totally different flooring – the Lahore, Karachi, and Islamabad inventory exchanges. In 2016, the federal government determined to merge the three by an act of parliament. Regardless of the merger, the PSX did carry ahead a number of the baggage of the KSE, LSE, and ISE – all three of which had been outdated, sluggish, and largely allowed merchants to run rife and keep little or no oversight. 

So when the brand new Chinese language administration took over, heads started to roll. Inside a few months of taking up, three main scams had been uncovered by the brand new administration’s watch canines. Amongst them was MR Securities – a brokerage home owned by Mazhar Rafiq, who’s the son-in-law of Seth Abid and the husband of the now deceased Farhah Mazhar. 

The anatomy of a fraud 

What did Mazhar Rafiq do? It was fairly easy truly. There have been no elaborate ponzi schemes and no hacks or high-stakes heists. Rafiq merely preyed on those who knew and trusted him, after which very quietly ran away with greater than a billion rupees value of their investments when the brand new PSX administration got here knocking on his door. 

Because the son-in-law of Seth Abid, he had a specific amount of social capital. And greater than social capital, he had the phantasm of wealth about him. Rafiq drove round in fancy vehicles, he vacationed overseas along with his household, and he was keen on internet hosting. His spouse Farhah was a formidable girl. An individual near the couple, and likewise one of many victims of the rip-off that Rafiq ran, described her as hard-nosed with an air of energy about her. “She walked, talked, and acted just like the daughter of Seth Abid. She was confident, stiff-necked, and outspoken,” they mentioned. 

“I keep in mind being at a perform with Farhah the place Moin Akhtar was performing. In his traditional type, Akhtar started to imitate the pashtun singer Attaullah Eesakhelvi. Farhah bought so mad she stood up and started telling Moin Akhtar to cease making enjoyable of a nationwide asset. It was a non-public perform, so everybody together with Moin Akhtar knew who she was. Her response was a bit excessive however her voice was calm and the silence within the occasion corridor was lethal. That was the measure of the lady.”   

Collectively, Mazhar Rafiq and his spouse Farhah made a formidable couple that ran in high-end circles of senior company executives and enterprise folks. His brokerage home had began as a small operation. Mazhar was not a very sensible investor or skilled of the inventory alternate, however he was a easy talker. He satisfied a big base of his personal pals and acquaintances to park their investments with him at MR Securities. 

“Mazhar’s complete schtick was convincing those who they might not lose their cash as a result of he was a believer in secure investments. He would say it was higher to take a position massive sums of cash in secure investments like authorities bonds quite than much less cash in riskier ventures. A variety of the folks he satisfied had been his pals and in the identical age-group approaching middle-age. That they had financial savings and many people parked all of them with Mazhar,” says one other sufferer that was shut with Mazhar and the deceased Farhah. 

This was a standard theme from the victims of Mazhar’s fraud. Most of them had been investing a big chunk of cash, they had been investing it with the information that others like them had carried out so, that Mazhar’s firm was profitable. “No person even thought that he would run away with the cash. In spite of everything, why would Seth Abid’s son-in-law have to run away with anybody’s cash,” says the sooner talked about sufferer. 

However that’s precisely what Mazhar did. The truth is, his fraudulent actions had been happening for a few years. Bear in mind how we talked about earlier that the PSX had carried ahead a number of the baggage from the lawless instances of the Lahore, Karachi, and Islamabad exchanges? In 2015, Mazhar Rafiq had truly been aided by Lahore Inventory Alternate entrance line regulator and Chairman Khalid Mirza in avoiding an inquiry into his brokerage home. These sorts of assists from pals, nevertheless, couldn’t final very lengthy. 

Round late 2016, a number of the buyers in MR Securities had been trying to get their spoils and pull out of the enterprise. Initially, they weren’t fearful when Mazhar delayed returning the cash or tried very arduous to get them to maintain their cash parked with him.  When the buyers persevered and Mazhar didn’t come by with the products, the primary indicators of bother started to appear. And proper on the heels of this, the brand new Chinese language administration on the PSX was sniffing out a brand new fraud each second day. 

In February 2017, Mazhar’s cellphone abruptly went off. Traders tried to contact him however he merely left a message to all of them – he was making himself unavailable to his shoppers and that he was beneath investigation by the SECP. This naturally prompted his buyers, lots of whom had not identified about this, to panic. Nonetheless nothing may work, as a result of per week earlier than all of this got here to gentle, Mazhar Rafiq had fled the nation and gone to the UK. He had locked his workplace, destroyed proof, and run away along with his shoppers’ shares and money in his custody. 

What unravelled from this level onwards was a multitude to place it mildly. The SECP blamed the administration of the PSX, which mentioned in flip that they’d simply taken management of the scenario and it was due to the oversight of the brand new administration that MR Securities together with MAM and AJW had been additionally apprehended. Mazhar Rafiq’s brokerage home had been, because the SECP defined, had been concerned in off-system, unlawful, ‘badla’ financing. 

Badla buying and selling includes shopping for shares with borrowed cash with the inventory alternate performing as an middleman at an rate of interest decided by the demand for the underlying inventory and a maturity not higher than 70 days.  

Primarily, it’s a system through which a brokerage home offers a mortgage to an investor eager to spend money on sure shares if that investor doesn’t have the funds for on the time. For instance, X has purchased a inventory and doesn’t have the funds to take supply, he can prepare a financier by the inventory alternate ‘badla’ mechanism. The financier would make the cost on the prevailing market fee and would take supply of the shares on X’s behalf – that means that they owned the shares. 

Mazhar Rafiq did this unlawful apply to loss of life, each for third events that approached him and straight with some unknowing shoppers of his personal. It ended up with him having full possession of the shares of his shoppers. On this method, his victims had been additionally victims of a system on the PSX that allowed stockbrokers to carry custody of shoppers’ shares and money.

All in all, Mazhar Rafiq managed to flee the nation with money and shares value over PKR 1.2 billion – leaving saving-less greater than 600 households, a few of which included senior residents, widows and terminal sufferers. However what led the son-in-law of one of many richest males in Pakistan to swindle his shoppers out of that a lot cash? Was it merely greed, or was it as a result of the home of the Seth was in disarray and Mazhar was making an attempt to fend for himself and his household.  

The load of the Seth

Allow us to, for a second, step again from the monetary crimes of Mazhar Rafiq and his MR Securities and have a look at the larger image. The life and instances of Seth Abid have been chronicled by this publication in an in depth obituary printed final 12 months.  

However to place it briefly, the Seth got here from nothing. Born to a household of merchants within the enterprise of transporting animal hides in Kasur, little is thought about his youth. Initially, nevertheless, the household had been from Calcutta, and had hyperlinks to the gold commerce in Delhi. The household narrowly averted the violence of partition, and in 1950 Seth Abid’s father moved his household to Karachi and re-entered the gold enterprise. 

Because it turned out, the newly-born Pakistan had no gold mines however nonetheless had an enormous cultural urge for food for gold. With their household hyperlinks in Calcutta and Delhi, Seth Abid’s father put him beneath the wing of seasoned smuggler Abid Bhatti, who took the younger man on journeys by the tall grasses of Kasur between the India and Pakistan border smuggling gold. Seth Abid quickly made a reputation for himself, and when the border turned extra tightly regulated he switched to smuggling gold from the gulf by sea routes.

His life is storied to say the least and mythicised to place in bluntly. From smuggling nuclear gear to kidnapping Benazir Bhutto, the myths across the Seth’s life grew and the fantastical tales round him turned him right into a close to legendary Robin Hood determine. In fact, there was solely a lot gold smuggling that might be sustained over time. Over the a long time, because the coast turned tighter and the Pakistan Navy and Coast Guard exerted extra management on smuggling, Seth Abid had shifted his enterprise curiosity from smuggling to actual property.

Finally, Seth Abid diversified and have become one of the crucial influential actual property builders within the nation. Whereas the story could have began with gold, that is the place it might finish. It was additionally by this route that his household met its first tragedy. His son, Seth Ayaz Ahmad, was an actual property prodigy and had run many profitable initiatives for his father.

Learn extra: Seth Abid: Pakistan’s ‘pious’ smuggler, mythmaker, and the final of the outlaws

In 2006, Seth Hafiz Ayaz Ahmad was travelling to examine an actual property undertaking owned by his father Seth Abid. Seth Ayaz had lengthy been the golden son of the Gold King of Pakistan. He had, in fact, not gone by the christening of bullets and high-speed chases that his father had seen in his a long time of smuggling gold into Pakistan. Whereas he could not have had a storied life like his father, he was competent and his path to taking up Seth’s enterprise was a transparent one. 

Most of Seth Abid’s kids had been born deaf, a incapacity that led to Seth Abid to discovered the Hamza Basis for deaf and dumb kids. The one youngster aside from Ayaz that was not otherwise abled was Farhah Mazhar, who was married and nicely taken care of by Seth Abid. Farhah and her husband couldn’t conceive kids of their very own, and whereas they adopted two sons and a daughter, Seth Abid was very clear that Seth Ayaz would substitute him as the pinnacle of the household. 

That’s till he was mowed down in a hail of bullets. The official reviews say he was killed by a lone-wolf safety guard affected by schizophrenia at the actual property undertaking he went to examine. Others have whispered that Ayaz’s loss of life was a hit-job — an outdated enemy coming for payback or a rival occasion vying for management. No matter it was, Seth Abid was not the identical man from that day ahead. 

“Ayaz’s loss of life broke Seth Abid. The daddy and son had been shut. They had been all the time facet by facet and discussing enterprise. The truth is, Seth Abid was imagined to be along with his son that day, however a final minute change of plan meant he went alone. After that, he withdrew from life. He stopped taking an curiosity within the household, within the enterprise, and in different issues. He was nonetheless very a lot round, however old-age and his son’s loss of life took all ambition out of him,” says one household buddy that was near Seth Abid. 

From that day onwards, Seth Abid let go. His previously neatly trimmed beard turned unkempt, his public appearances grew rarer and rarer, and in one in every of his final photographed appearances, he met Prime Minister Imran Khan trying frailer than ever earlier than. As Seth Abid slipped to outdated age and private tragedy, his consideration in the direction of his daughter and the remainder of his household waned. It was at the moment that his son-in-law, Mazhar Rafiq, started turning into bolder relating to monetary selections. 

One specific sticking level, for instance, was a big tract of land almost six acres in measurement that Seth Abid had given his daughter in the course of Defence Housing Authority in Lahore – proper subsequent to the housing society’s W block. As defined by a supply in NAB, the land was value some huge cash, notably as a result of DHA needed management of it so they might broaden. Mazhar Rafiq needed to promote that piece of land, and despite the fact that Seth Abid was towards it he continued to strike offers. 

This, in fact, is one clarification – the one given by these as soon as near Seth Abid. That he had withdrawn from the world and {that a} bad-egg son-in-law used his identify and standing to swindle folks out of their hard-earned cash. A number of the buyers whose cash Mazhar ran away with declare that the story could be very totally different. “I’ve thought from the very starting that Seth Abid was concerned. The way in which Mazhar Rafiq ran away, it couldn’t have been with out the assistance of somebody influential like Seth Abid. There had additionally been critical allegations that MR Securities was truly being utilized by Seth Abid to launder plenty of his black cash,” says one of many earlier talked about sources who was additionally a sufferer of Mazhar Rafiq. 

About that homicide 

So right here is the place we’re in February 2017. Mazhar Rafiq, the son-in-law of Seth Abid, has run away along with his investor’s cash and isn’t planning on returning. His spouse and their three adopted kids are nonetheless in Pakistan, the place they’re going through a grilling by NAB and the native police. 

His spouse, Farhah Mazhar, is protected to a fantastic extent by the affect that her father Seth Abid nonetheless wields. Regardless of this, a humiliating journey begins. Mazhar Rafiq’s image and ID card are printed in newspapers, he’s decried by the SECP, and his victims are assured by the regulator and the inventory alternate that they are going to be compensated and that Rafiq will probably be extradited and introduced again to Pakistan for justice. 

Affectees went to NAB and the PSX to file their claims. “Someday later, the affectees had been knowledgeable by the PSX that the full verified claims amounted to PKR 1.2 billion and the method of restoration and refund would begin quickly. Regrettably, little or no progress has been made thus far and the affectees proceed to undergo in agony in regards to the destiny of their investments,” wrote Naveed Ather Sheikh, a sufferer of Mazhar Rafiq’s fraud, in a letter to the editor printed in Daybreak in June 2021 after the loss of life of Seth Abid.  

“As regulators and guarantors, each the Securities and Alternate Fee of Pakistan (SECP) and the PSX failed of their responsibility to safeguard the pursuits of the investing public. Thus far, a miniscule compensation of about two per cent of the accredited declare quantity has been made by the PSX to the affectees out of its investor safety funds. Greater than two years have handed since this final replace. No progress has been made thus far whereas the affectees proceed to undergo in agony.” 

“Issues began to collapse fairly shortly. Farhah bore the social backlash of her husband’s crimes whereas he was out within the UK and unable to return. She continued to say her innocence however abruptly the household was carrying the mark of this challenge. Their monetary scenario didn’t notably deteriorate, however inside one another plenty of scuffling started to come up. It was additionally round this time that Fahad Mazhar started an affair along with his family maid, because the police at the moment are claiming, and which culminated on this tragedy.” 

A police spokesperson has confirmed to Revenue that they haven’t spoken to Mazhar Rafiq relating to his spouse’s homicide and {that a} monetary angle to the crime isn’t being thought-about. “Fahad Mazhar tried to painting the entire story as a suicide, nevertheless, it was his brother who lived seperately along with his family who informed us there had been points between Farhah Mazhar and her different son. We’re not positive whether or not Farhah Mazhar was shot unintentionally throughout a scuffle or as a part of a plan, however the proof very strongly factors in the direction of it being a criminal offense of ardour.”

This, in fact, doesn’t change the truth that the destiny of the Mazhar household was tossed on its head after the exposition of the monetary crimes of Mazhar Rafiq. The household underwent nice stress, turned social pariahs in plenty of their circles, and notably after the loss of life of Seth Abid in January 2021 had been left totally rudderless. Whereas the homicide was positively private enterprise, your complete lives of Seth Abid and his household have been lined top-to-bottom in what appears to be a neverending cycle of crime, violence, and large sums of cash. It’s a stark if gory reminder that the enterprise of cash could be a harmful one, and that the implications of the monetary very recurrently bleed into the non-public. And it’s as a lot a tragic anecdote as it’s a lesson.