Key Takeaways
- Four Unity Foods officials remain in custody after bail applications were denied.
- The case involves allegations of funds misuse and possible money laundering.
- The court proceedings are adjourned until September 12.
Four current and former officials of Unity Foods Limited, a company listed on the Pakistan Stock Exchange (PSX), remain in custody after their bail applications were denied in the Federal Investigation Agency’s (FIA) multi-billion-rupee corporate crime case.
According to a Securities and Exchange Commission (SECP) statement, the scheduled court proceedings were adjourned until September 12. The accused seeking bail include former chief financial officer Jalees Edhi, director Safdar Sajjad, former director Abdul Majeed Ghaziani, and Amir Shehzad, who served as a director of Unity Foods and later as chief executive of its subsidiary, Sunridge Foods.
The case was registered on August 29 by FIA’s Corporate Crime Circle, Karachi, following a reference submitted by SECP after its examination identified suspected criminal breach of trust, falsification of accounts, misuse of company and shareholders’ funds, and possible money laundering.
A central allegation in the case concerns an estimated Rs44.7 billion difference between Unity Foods’ published financial information and its internal SAP records. The investigation also covers an alleged Rs5.2 billion inventory shortfall, approximately Rs5 billion in receivables without evidence of corresponding deliveries, and suspected diversion of around Rs2.87 billion from a Rs3.75 billion rights issue raised for specified expansion projects.
FIA is also examining alleged payments of Rs5.318 billion involving the former chief executive’s mother, other related-party transactions, and the possible use of Unity Foods’ funds and resources for connected entities.
Unity Foods is listed on the PSX with approximately 34% of its shares held by the public. Singapore-based Wilmar International holds around 42%, while Farrukh Amin and his family own approximately 24%. The case has wider implications for public shareholders and foreign investors, as Wilmar has recognised a $150 million provision relating to its investment in Unity Foods.
Separately, several regulatory proceedings involving Unity Foods remain before civil courts, including challenges to SECP’s investigation orders, alleged insider trading in the company’s shares, and the proposed takeover of Al-Shaheer Corporation Limited.
