Unity Foods: Officials Denied Bail In Rs44.7bn Discrepancy Case.
✧ GENERATE BRIEFING +
Four current and former executives of Pakistan Stock Exchange-listed Unity Foods Limited—including former CFO Jalees Edhi, director Safdar Sajjad, former director Abdul Majeed Ghaziani, and former subsidiary CEO Amir Shehzad—remain in custody after a special court adjourned their bail applications until September 12. The high-stakes legal proceedings arise from an FIA Corporate Crime Circle FIR registered on August 29 based on a formal reference from the Securities and Exchange Commission of Pakistan (SECP). The investigation centers on severe corporate governance breaches, including an alleged Rs44.7 billion discrepancy between published financial statements and internal SAP records, a Rs5.2 billion inventory shortfall, and roughly Rs5 billion in unverified receivables.Further compounding the corporate crisis, investigators are probing the alleged diversion of Rs2.87 billion from a Rs3.75 billion rights issue alongside Rs5.318 billion in questionable related-party transactions linked to former CEO Farrukh Amin, who previously secured protective bail from the Sindh High Court.
Four current and former officials of Pakistan Stock Exchange-listed Unity Foods Limited have remained in custody after failing to secure bail in a Federal Investigation Agency (FIA) corporate crime case involving alleged financial irregularities.
The Securities and Exchange Commission of Pakistan (SECP) said the court proceedings were adjourned until September 12. The accused seeking bail are former CFO Jalees Edhi, director Safdar Sajjad, former director Abdul Majeed Ghaziani and Amir Shehzad, a former director who later served as CEO of Unity Foods subsidiary Sunridge Foods.
The case stems from an FIA Corporate Crime Circle Karachi FIR registered on August 29 following a reference submitted by the SECP. The regulator said its examination identified suspected criminal breach of trust, falsification of accounts, misuse of company and shareholders’ funds and possible money laundering.
Former Unity Foods CEO Farrukh Amin was previously released after a Karachi magistrate rejected the FIA’s request for his physical remand in light of a protective order issued by the Sindh High Court. He was ordered to furnish a bond, cooperate with investigators and remain in Pakistan without permission to travel abroad.
A major part of the investigation concerns an alleged Rs44.7 billion discrepancy between Unity Foods’ published financial information and its internal SAP records. Investigators are also examining an alleged Rs5.2 billion inventory shortfall and around Rs5 billion in receivables for which corresponding deliveries were reportedly not evidenced.
The FIA is further examining the alleged diversion of about Rs2.87 billion from a Rs3.75 billion rights issue raised for specified expansion projects, as well as alleged payments worth Rs5.318 billion involving the former CEO’s mother and other related-party transactions.
Unity Foods has around 34% public shareholding, while Singapore-based Wilmar International holds approximately 42% and Farrukh Amin and his family around 24%. The SECP said the matter has implications for public shareholders and foreign investors, with Wilmar having recognised a $150 million provision related to its investment in Unity Foods.
Several other regulatory matters involving Unity Foods remain before the courts, including challenges to SECP investigation orders, alleged insider trading in the company’s shares and the proposed takeover of Al-Shaheer Corporation.
