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NCA 'dirty cash' probe in question - billionaire still owns mansion 15 months after 'surrender deal'

INVESTIGATION: THE success of a landmark £190 million National Crime Agency (NCA) settlement with a billionaire property tycoon has been called into question after it emerged he still owns a £50 million London mansion about 15 months after it was supposed to be sold and the proceeds returned to Pakistan.

In December 2019 developer Malik Riaz Hussain, 67, (pictured above) reached a secret out of court settlement with the NCA to sell the mansion overlooking Hyde Park and return the proceeds to the state of Pakistan.

The agreement also saw him agree to surrender £140 million of suspected "dirty money" held across nine bank accounts to the Pakistan government.

The secretive settlement came after the NCA had earlier launched an international bribery and corruption probe into Mr Hussain's UK assets.

MANSION: The property at Hyde Park Corner still has not been sold (NCA)

However, Essex News and Investigations can reveal the developer has yet to sell the seven-floor Grade II listed property.

Separate agreements reached in Pakistan also saw Mr Hussain able to use the £140 million to pay towards debts his company owes to the Supreme Court there, meaning he benefitted from the agreement.

The settlement was reached by an NCA unit funded by the Department for International Development (DfID) whose aim is to return illicit money to countries receiving development aid from the UK.

The NCA had suggested that the total £190 settlement, which it hailed as its biggest ever bank account freezing order success since the introduction of the Criminal Finances Act in 2017, would be returned to the state of Pakistan for the benefit of its people.

INVESTIGATION? The NCA was supposed to be looking into bribery and corruption (NCA)

When the settlement was announced Duncan Hames, Director of Policy at anti-corruption organisation, Transparency International UK said there was "scant information about the agreement, but he welcomed news that "UK law enforcement have secured a substantial amount of funds for return to the people of Pakistan."

The organisation did not comment on Essex News and Investigation's findings.

It has emerged that Mr Hussain, one of the richest men in Pakistan, was able to broker a deal with the Pakistan Government to allow him to use the money to part-pay around £2.6 billion owed by his property company Bahria Town to the Supreme Court of Pakistan, following a major land dispute upon which he built a major housing development in Karachi.

Photographs taken by a Pakistani investigator and published in a YouTube video, allegedly show Mr Hussain meeting with senior Pakistan Government officials near the Hyde park mansion and in London's Dorchester Hotel.

The video claimed the two had met in London daily for two weeks after the announcement was made.

The NCA confirmed it is aware of the video, but refused to comment on it.

The agency had earlier highlighted the settlement as an exemplary case study of the use of civil court orders to deal with suspected money laundering in a section on bribery and corruption in its 2020

CASE STUDY: The NCA piece on the case in the latest national strategic assessment (NCA)

It said: "The £190 million settlement is the result of a civil investigation by the NCA into Malik Riaz Hussain, a Pakistani national, whose business is one of the biggest private sector employers in Pakistan.

"Included in the settlement was a UK property,1 Hyde Park Place, valued at approximately £50 million.

"Some £140 million, which had already been identified and frozen in bank accounts, has already been returned to Pakistan."

However, after it emerged Mr Hussain has been able to use the money for his business debts, the success of the operation has been called into question.

A senior partner at a law firm, which specialises in financial crime and money laundering, said for accounting freezing orders to be granted a court would have to be convinced on the balance of probabilities that the property was derived from crime.

He said: "In terms of the forwarding of the monies to Pakistan, the authorities in different countries have memoranda of understanding that often have asset sharing clauses on forfeiture.

"Speaking generally, the idea is that the state that has suffered the actual bribery on its contract gets the money or assets back.

"It would not make sense for (the person subject to a freezing order) to be given access to that money to settle debts in other jurisdictions and should always be a direct payment between the authorities in each jurisdiction to make sure it reaches actual victims."

The mansion, which boasts 10-bedrooms, a cinema, swimming pool, gym, steam room and spa, had, before the settlement, previously been listed for rent on property website Zoopla for £86,667 a month.

It was bought by Mr Hussain from Hasan Nawaz Sharif, a son of former Pakistani prime minister Nawaz Sharif.

The 70-year-old former Prime Minister held office until July 2017, when he was removed from office by the Supreme Court of Pakistan following revelations from the Panama Papers leaks about offshore companies that revealed details of some properties owned in London, prompting a major corruption probe into him and his family, including Hasan Nawaz Sharif.

INVESTIGATION: Hasan Nawaz Sharif had a charge against the Hyde Park Place property in 2016 (YouTube)

Land Registry records show Mr Hussain paid £42.5 million for it in 2016 and it is owned through an offshore company Ultimate Holdings MGT Ltd registered in the British Virgin Islands.

It was still shown as being owned by Mr Hussain's company today, and the NCA has no legal charge registered against it, which would have meant it had to be notified of any sale.

Last June Nick Nicholson, an accountant who specialises in insolvency and proceeds of Crime of the firm Haslers in Loughton, Essex, registered a charge against the property, meaning he would have to be notified of any future sale before it went ahead.

Mr Nicholson did not respond to requests for comment.

An NCA spokesman initially said the agency would not comment on Mr Nicholson's involvement with the property.

However, he later added: "Haslers were appointed jointly by the NCA and the property owner to deal with the sale of the property as part of the settlement.

"The sale process is continuing and the charge relates to Haslers' role. There is no issue of insolvency or other lending secured on the property.”

The NCA first froze £20 million in UK-based bank accounts belonging to Mr Hussain in December 2018.

In August 2019 a further £120 million held across eight bank accounts with UK branches of the Emirates NBD Bank PJSC, owned by the Dubai Government, linked to his close relatives and businesses, including

Ultimate Holdings MGT Ltd, were also frozen.

RECORD: Land Registry register showing ownership by offshore company

At the time the NCA said the freezing orders were part of an investigation into suspected bribery and corruption in an overseas country and that it was the largest amount of money it had ever frozen in connection with one investigation.

Account freezing orders can be applied for when an enforcement officer has reasonable grounds for suspecting that money held in an account is recoverable property under the Proceeds of Crime Act, or is intended for use in unlawful conduct.

They can be challenged in open court by the account owner.

An NCA release at the time said: "The orders will allow the NCA to further investigate the funds. If found to be derived from - or intended for use in - unlawful conduct, the NCA will seek to recover the money."

The NCA’s Ben Russell, Deputy Director of the National Economic Crime Centre (NECC), also said: “The NECC leads UK law enforcement efforts to tackle illicit finance, bringing the capabilities of multiple agencies together against the threat."

However, within four months the NCA announced it had reached the "out of court settlement" with Mr Hussain and any criminal investigation into suspected bribery and corruption probe appeared to have been dropped.

The NCA release at the time of the December 2019 settlement, said the investigation into Mr Hussain had focussed on assets rather than individuals and that the "settlement was a civil matter and did not represent a finding of guilt."

The secretly captured pictures by the investigator appear to and allegedly show Mr Hussain outside the mansion with Shehzad Akbar, who was at the time Special Assistant to the Prime Minister on Accountability and chief of the Assets Recovery Unit.

They also appear to and allegedly show the pair also inside a building said to be the Dorchester Hotel.

Soon after the NCA announcement in December 2019, Mr Hussain tweeted: "Some habituals are twisting the NCA report 180 degrees to throw mud at me.

"I sold our legal and declared property in the UK to pay £190M to the Supreme Court Pakistan against Bahria Town, Karachi."

His tweet prompted much speculation in the Pakistan press about why the state was not benefitting from the supposedly "surrendered" millions.

DEAL? Shehzad Akbar said the money would go to the Supreme Court (Samaa TV)

Mr Akbar later told a press conference the money was going to the Supreme Court, but said due to a confidentiality agreement, he could not comment further.

He said: "Is the Supreme Court not part of the government? So if the money goes to the apex court it means that the money comes to the state.”

Pakistan-based Journalist Muhammad Ziauddin, former editor of The Express Tribune, wrote of the deal: "How could an amount of tainted money recovered from Malik Riaz in the UK and returned to State of Pakistan go into the Supreme Court account as a settlement of part of a huge fine imposed by the court on the same alleged offender of money laundering for gabbing a vast tract of pricey land in Karachi’s Malir district?

"The biggest beneficiary of this Houdini act performed by Shahzad Akbar is our real estate tycoon, Malik Riaz.

SNAPPED: This image taken near the mansion is said to show Mr Hussain (right) and Mr Akbar (left) (YouTube)

PICTURED: Another shot said to show Mr Akbar (left) and Mr Hussain (right) in the Dorchester Hotel (YouTube)

"But one would once again ask the Supreme Court how could it accept from Malik Riaz, without question, tainted money as part of a fine it had imposed."

Neither Mr Hussain or the Pakistan Government responded to questions about the deal and why the money had been used to help clear the former's business debts.

An NCA spokesman would not answer questions about the money being used to pay off business debts, if there was a deadline for the sale of the mansion, or if any money laundering investigations continued.

The NCA spokesman said: "We are not able for legal reasons to comment on details of the settlement or on the existence of NCA investigations.

"The receipt from the property will be returned once it is sold.

"Our statement in December 2019 stated that all the assets will be returned to Pakistan.

"It stated that the assets will be returned to the state of Pakistan. It does not claim the assets were paid to the NCA.

"The £140 million in the accounts that were initially frozen has already been returned.

"There is widespread reporting in Pakistan media of comments from Mr Akbar that 'The money has been transferred to the Supreme Court and we have already filed a request before the apex court that the money should be given to us (Pakistan Government).'

"Generally, parties have a wide degree of freedom as to the terms on which they settle such disputes, including terms which keep certain aspects of the settlement confidential between the parties, the NCA’s approach is to be as transparent as possible and keep any confidentiality to a minimum."


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