Shariah & General violation in different modes of investments

Shariah & General  violation in different modes of investments

Shariah & General  violation in different modes of investments (Bai Murabaha and Bai’ Muajjal) as observed have been presented bellow:

1.    The clients are given investment facilities in cash.
2.    Cash memos are not available.
3.    The cash memos of puchased goods are taken in clients’ name instead of the Bank.
4.    The cash memos are taken before and after the disbursement of investment.
5.    The customers take the goods directly from the seller instead of the Bank.
6.    The Bank maintains no records for receiving the goods.
7.    The clients are the applicants of Pay Order, DD, TT instead of the Bank.
8.    New investment created for adjusting the previous investments.
9.    Charging of additional profit for extension of time.
10.     Letter of authority didn’t take in case of indent/MPI dealership.
11.     Creation of Baim-Wes (Stock lot).
12.     Agreement kept vacant.
13.     Amount of disbursement not agreed with the amount of cash memo.

Irregularities related to cash memo:

1.    Branches don’t preserve/obtain cash memo of the goods purchased.
2.    Cash-memos are taken before investment.
3.    Cash-memos are taken after investment.
4.    Cash-memos are taken without having signature of the seller.
5.    Bank officer sign in the cash memo as seller.

Irregularities related to receiving of goods delivery:

1.    Investment client recives goods in lieu of the bank officer.
2.    In some cases, there is no evidence of goods received by the branch from seller.
3.    In some cases, there is no evidence of goods received by the client from the branch.

Irregularities related to Agreement:

1.    The Signature of the client is being taken in blank agreement form(s).
2.    Agreement forms(s) are being preserved without date and witness.
3.    Agreements don’t contain the signature of the Branch Manager.

Irregularities related to profit charged:

1.    Profit is charged before Buying and selling of goods.
2.    Profit is charged more than one time on the same buying and selling deal.
3.    Profit is realized wihout charging with the cost price at the sale stage rather profit is charged at the adjustment stage.
4.    Charging profit for the excess time.
5.    Profit charged by creating Bai-Muajjal investment if there is any delay or less amount receipt against the sales proceeds of export L/C.
6.    Profit charged on stock lot without buying and selling.
7.    In case of conversion of Bai Muajjal and Bai Murabaha investment (Previous investment) to Hire purchase, rent is charged without establishing the ownership of Bank on the asset.

Other irregularities:

1.    No negetiation is held between the client and the branch to purchase goods.
2.    Goods are purchased from the sister organizations of the clients.
3.    Cash facilities provided to the client directly or indirectly.
4.    Investment client is engaged as buying agent in every case.

Irregularities found in HPSM:

1.    To allow investment under HPSM without having ownership of the Bank on the asset.
2.    To charge rent on rent.
3.    To allow investment under HPSM without existence of the asset.
4.    To allow investment to adjust the liability of other Banks.
5.    To adjust the previous liability of the client by creating HPSM.
6.    To allow HPSM for the purpose of L/C margin.
7.    To charge rent on the asset before it becomes rentable/usable.
8.    To allow HPSM investment on fungible goods.