The Federal Investigation Agency (FIA) Corporate Crime Circle in Karachi has registered a First Information Report (FIR) against the former management of Unity Foods Limited following a referral by the Securities and Exchange Commission of Pakistan (SECP). The public-listed company on the Pakistan Stock Exchange (PSX) faces serious allegations of financial irregularities, account falsification, and the diversion of shareholders’ funds.
The criminal proceedings follow a detailed SECP inspection that uncovered severe financial discrepancies, including:
- Diversion of Rights Issue Funds: Out of Rs 3.75 billion raised from public shareholders in 2019 for expansion and refinery development, approximately Rs 2.87 billion was allegedly diverted away from its stated purpose without evidence of proper utilization.
- Unauthorized Related-Party Transactions: SECP identified suspicious payments totaling Rs 5.318 billion made from company funds to the former CEO’s mother under the pretense of loan transactions without required board approvals or banking records. Additionally, Rs 2.6 billion was advanced to undisclosed parties via a subsidiary.
- Major Accounting & Inventory Discrepancies: A massive Rs 44.7 billion gap was discovered between the company’s published financial statements and its internal SAP records. Furthermore, examiners found an unverified Rs 5.2 billion inventory discrepancy and around Rs 5 billion in aged receivables lacking proof of delivery.
Because the findings involved potential criminal offenses beyond the SECP’s direct regulatory mandate, the Commission referred the case to the FIA under Section 41-B of the SECP Act, 1997. The FIR was formally registered on August 29, 2026, under Sections 406, 420, 477-A, 109, and 34 of the Pakistan Penal Code.
SECP Chairman Dr. Kabir Ahmed Sidhu emphasized that protecting minority investors remains the regulator’s top priority, reinforcing that public funds must strictly serve their disclosed corporate purposes. The FIA’s investigation is ongoing to trace fund movements and determine the criminal liability of involved executives, directors, and beneficiaries.
