More banks to be investigated in connection with exchange rate manipulation SBP chief.

ISLAMABAD -- The State Bank of Pakistan (SBP) has extended the scope of investigation regarding the role of further private banks in exchange rate manipulation after investigating eight banks.

State Bank of Pakistan (SBP) Governor Jameel Ahmad informed the Senate's Standing Committee on Finance and Revenue on Friday that SBP had started investigation against eight banks regarding the role of further private banks in exchange rate manipulation. However, the central bank has now decided to extend the scope of investigation by investigating more banks in this regard. Action would be taken against the banks involved in the matter, he added.

The meeting of the Standing Committee on Finance and Revenue was held on Friday at Parliament House and was chaired by Senator Saleem Mandviwala. Discussing the Point of Public Importance raised by Senator Fida Muhammad regarding opening of LCs at appreciated rates and the issues faced by traders in this regards, the Committee was of the view that strict notice must be taken against banks that fall in this category. It was asserted that their licenses must also be revoked. Chairman Committee, Senator Saleem Mandviwala informed members that the Committee has raised the matter numerous times in previous meetings and as a result an inquiry is being conducted by SBP to address grievances. It was asserted that the matter was termed a result of the dollar hike in Pakistan and an adverse trade shock. Once enquiry is complete a compliance report will be submitted to the Committee.

Minister of State for Finance Ayesha Ghous Pasha informed the committee that the government would give exemplary punishment to the commercial banks involved in over charging on Letter of Credits (LCs) payments by imposing massive fines on them. Governor SBP informed that commercial banks had started charging extra dollar on LCs payment after they faced shortage of dollars. He said that the central bank had thoroughly investigated the matter.

A committee member Senator Kamil Ali Agha asked whether the businessmen who were over charged would get back their money. However, governor said that they would not get their money back but action would be taken against the banks involved in the matter.

The meetings commenced with a detailed discussion on the harassment felt by law abiding, tax paying citizens of Pakistan due to loopholes in the online system that was introduced to facilitate filing of tax returns. Senator Kamil Ali Agha narrated the...