KARACHI
District & Sessions Judge in Karachi has ordered the issuance of bailable warrants for various individuals associated with The Resource Group International Limited. The issuance of warrants comes after the judge took cognizance in a criminal defamation suit filed by complainant Zia Chishti, the founder of TRG Group.
Orders for issuance of bailable warrants have been made against Mohammad Khaishgi, Hasnain Aslam, Pat Costello, Hassan Farooq, John Leone, Patrick McGinnis, Waleed Tariq Saigol, Zafar Iqbal Sobani and Khaldoon Bin Latif. These bailable warrants were issued after the District & Sessions Court took cognizance that violations had been made under S499, S500 and S501 of the Pakistan Penal Code, causing tremendous humiliation and distress to the complainant.
The accused comprise of board of directors and senior management at TRG International. These include Mohammad Khaishgi (CEO and Chairman of TRG International and Chairman of TRG Pakistan), Hasnain Aslam (Director TRG International and CEO of TRG Pakistan), Pat Costello (General Counsel TRG International), Hassan Farooq (Group Director Finance TRG International).
Other accused persons include TRG International Directors John Leone, Patrick McGinnis , Waleed Tariq Saigol (, Zafar Iqbal Sobani and Khaldoon Bin Latif.
The next hearing in the criminal complaint proceedings are scheduled for March 8, 2023. The majority of the accused are based in USA and UK and it remains to be seen whether these accused persons will attend to clear their name in the Pakistani courts.
Counsel for various accused persons had filed an application in the Sindh High Court to dismiss the criminal complaint.However, after this application was unsuccessful, the counsels submitted a detailed reply with the District & Sessions Court seeking dismissal of the criminal complaint, which also did not bear any fruit.
This criminal complaint is the latest part of a power struggle between former colleagues and founding members of the TRG Group which include Zia Chishti, Mohammed Khaishgi and Hasnain Aslam.
In November 2021 Zia Chishti stepped down from various roles in TRG and its portfolio companies on the back of media reports of an arbitration award against him during his time at Afiniti. Zia Chishti’s resignation left a power vacuum at TRG Pakistan and TRG International which led to a power struggle to gain control over one of Pakistan’s most successful technology companies.
Last year a complaint was filed by a director of TRG Pakistan, highlighting a number of legal violations by the company and its management team to gain control at the expense of thousands of shareholders.
This complaint, to the Securities & Exchange Commission of Pakistan, highlighted how cash and assets that belonged to TRG Pakistan’s public shareholders were illegally withheld and used to acquire voting control in TRG Pakistan in contravention of Pakistani law.
TRG International has been accused of illegally withholding the funds due to shareholders, to acquire a substantial shareholding in TRG Pakistan through an entity named Greentree Holdings Limited domiciled in the tax haven of Bermuda.
Greentree has utilized a substantial portion of the USD 120 million of cash due to TRG Pakistan to acquire a 28.5% shareholding in the Company.
Greentree is currently the largest shareholder in TRG Pakistan. Currently, Greentree’s board of directors comprise of Syed Muhammad Shabbar Zaidi, Ali Ahsan, Ahmed Pervaiz and Ameer Qureshi.
In addition to the above TRG Pakistan was also due its portion of the shareholding in Ibex Limited, a Nasdaq listed entity. TRG Pakistan had publicly disclosed that this asset would also be held through Greentree Holdings Limited.
However, in a disclosure made in November 2022, TRG Pakistan confirmed that the shareholding is being maintained through TRG International instead, which is a violation of the commitment made to TRG Pakistan’s shareholders.
The SECP had issued various show cause notices to TRG Pakistan for a number of violations, based on the whistleblowing complaint by its director. TRG Pakistan has secured an injunction through the Sindh High Court against the SECP and the matter is now pending in court.
