Mehran Bank scandal

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The Mehran bank scandal also known as Mehrangate, was a major political scandal in the history of Pakistan between 1990-1994 in which senior politicians and political parties were found to have been bribed by Pakistan Army and intelligence officers, from ISI, to prevent the re-election and to destabilize the government of the Pakistan Peoples Party (PPP).[1]

Initiated by Pakistan Army's Chief of Army Staff General Mirza Aslam Beg with the alleged support of President Ghulam Ishaq Khan payments of up to PKR 140 million were made by the Inter-Services Intelligence (ISI) Director-General Lieutenant-General Asad Durrani and Corps of Engineers Engineer-in-Chief Lieutenant-General Javed Nasir via the owner of Mehran Bank, Yunus Habib. Intelligence funds were deposited in Mehran bank in 1992 propping up what was an insolvent bank as a favor for its owner's help in loaning money to the Inter-Services Intelligence in 1990 that was used in the creation of the right wing alliance Islami Jamhoori-Ittehad (IJI) and bankrolling the campaigns of many opponents of the PPP.

The scandal subsequently broke after the new ISI Director-General Lieutenant-General Javed Ashraf Qazi decided to transfer the intelligence fund back to state owned banks as per official rules. Mehran Bank was unable to return the money due to its poor financial state and collapsed. It was later discovered that large sums had been siphoned off to 39 fictitious parties.

In 1995, Mehran Bank was amalgamated with the National Bank and in 1996 the NBP had to make full provision for Mehran's liabilities which resulted in a net loss that year to the bank of Rs 1.260 billion.[2]

On April 20, 1994, giving details about the payments made by Mr Habib to generals, politicians and political parties, the then Interior Minister, Naseerullah Babar, told the National Assembly that the main beneficiary of his largess was former army chief General Mirza Aslam Beg who received Rs140 million.[3]

Yunus Habib was arrested on April 7, 1994 for misappropriation in the sale proceeds of the Dollar Bearer Certificates. On Dec 14, 1995, Younus Habib was convicted of fraud and embezzlement and given a sentence of 10 years rigorous imprisonment by the Special Court for Offences in Banks in Sindh.[4]

Yunus Habib resurfaced into the news again in 2012 after he was summoned by Pakistan’s apex court in a case[5] relating to disbursement of money among different politicians by the Pakistani intelligence agency, the ISI.[6]

See also[edit]


  1. ^ Political Generals guilty, finally
  2. ^ Ghazali, Abdus Sattar. "ISLAMIC PAKISTAN: ILLUSIONS & REALITY". Retrieved 2006-05-05. 
  3. ^ M. H. Askari, Aftermath of the MBL scam - Dawn 27.4.1994
  4. ^ NAB recovers Rs1.6bn in Mehran Bank case: Younus Habib’s property sold DAWN. DAWN group. Retrieved 02-02-09
  5. ^ Zaidi, Mujtaba Haider. "Apathy towards Asghar Khan Case" The Frontier Post Daily English Newspaper. May 16, 2013 URL:
  6. ^ (8 March 2012). "Central character of Mehran Bank scandal resurfaces".