SHC Grants Interim Relief in SECP-FIA Jurisdictional Dispute

The Sindh High Court has recently provided interim relief to our clients in a constitutional petition. The Court has ordered that no coercive action be taken against the petitioners following the issuance of a controversial notice by the Federal Investigation Agency’s (FIA) AML/CFT Circle.

The matter stems from a 2019 Securities & Exchange Commission of Pakistan (SECP) complaint filed before the Special Court (Offences in Banks) concerning alleged violations of the Securities Act, 2015. Despite the case being sub judice for seven years, the FIA recently initiated an enquiry seeking a blanket disclosure of the petitioners’ entire banking history from all commercial banks.

The petition contends that the FIA lacks the jurisdiction to invoke the Anti-Money Laundering Act, 2010, as no independent predicated offence or proceeds of crime have been identified and the pending trial on securities laws is based on offences that are not predicated offences under the Anti-Money Laundering Act, 2010.

It was argued that the SECP, as an AML/CFT regulatory authority, failed to allege money laundering for seven years. It was pleaded that current referral is a belated afterthought and a roundabout way to exert pressure on our clients.

The petitioners maintain that these parallel proceedings violate Article 4 (right to be dealt with in accordance with law), Article 10A (right to a fair trial), Article 13 (prohibition of double punishment) and Article 14 (inviolability of dignity/privacy) by subjecting them to overlapping summons and a fishing and roving inquiry.

The grant of the stay order reinforces the principle that where a special law provides a specific forum (in this case, the Special Court for securities violations), other agencies cannot launch parallel coercive proceedings over the same factual matrix without a clear, independent statutory foundation.

The firm’s team in this matter is led by Arshad Tayebaly, Senior Partner, and includes Sameer Tayebaly, Senior Associate, and Hammad Qureshi, Associate.