The Federal Investigation Agency (FIA) has filed a criminal case against the former management of Unity Foods Limited, a company listed on the Pakistan Stock Exchange, following findings of major financial irregularities reported by the Securities and Exchange Commission of Pakistan (SECP).
According to the First Information Report (FIR), the SECP referred the matter under Section 41-B after its investigation uncovered discrepancies of approximately Rs44.7 billion between the published accounts of Unity Foods and internal SAP records.
The FIR states that Unity Foods raised Rs3.75 billion through a right issue, of which Rs2.87 billion was allegedly diverted for purposes not disclosed to shareholders. It further alleges that Rs5.318 billion was paid from company funds to the mother of the former chief executive officer as a loan.
Investigators also noted that a subsidiary of Unity Foods advanced Rs2.6 billion to two unidentified parties. In addition, the FIR highlights a Rs5.2 billion difference between inventory recorded in company books and physical stock, as well as a lack of evidence for goods supplied against liabilities of about Rs5 billion.
The Corporate Crime Circle of FIA in Karachi registered the case on August 29 against the former management and other accused of the company under relevant provisions of the Pakistan Penal Code.
SECP Chairman Kabir Ahmed Sidhu stated that the regulator is committed to protecting investor funds and ensuring transparent financial reporting. He emphasized that funds raised from shareholders must be used strictly for the purposes disclosed to them.
Unity Foods Limited was incorporated in 1991 as Taha Spinning Limited, initially operating in the textile sector. After facing losses, the company shifted its principal business to edible oil extraction and refining under the new name Unity Foods.
