An Islamabad court has convicted Bahria Town’s Deputy Chief Executive alongside two co-accused, adding another courtroom defeat to a real estate empire already fighting on multiple legal fronts.
The Bahria Town Deputy CEO jailed verdict marks the second major conviction this year against retired Colonel Khalil ur Rehman, the group’s vice chief executive, and lands squarely in the middle of a widening federal crackdown on Pakistan’s largest private housing developer.
What the Verdict Says
A court found retired Colonel Khalil ur Rehman guilty of illegally transferring roughly Rs. 1.7 billion abroad through hawala and hundi channels instead of authorised banking routes. Investigators alleged the funds financed various Bahria Town projects while bypassing Pakistan’s regulated foreign exchange system and the State Bank’s required approval.
The court ruled that the prosecution had established the charges against all three accused beyond the threshold required for conviction, and sentenced each under the Foreign Exchange Regulation Act. It’s a narrower penalty than headlines might suggest, but the symbolism looms large for Pakistan’s real estate sector.
Who Are the Convicted Accused
Three names now carry fresh convictions tied to this case:
- Retired Colonel Khalil ur Rehman — Vice Chief Executive of Bahria Town
- Muhammad Imran, alias “Imran Kaka” — alleged hawala agent
- Muhammad Mushtaq Ahmed — property dealer
Each of the three was sentenced to one year of simple imprisonment and fined Rs. 500,000. The case stems from FIR No. 48/25, registered by the FIA’s Corporate Crime Circle in Islamabad on July 9, 2025, under Sections 4, 5, 8, 9, and 23 of the Foreign Exchange Regulation Act.
Inside the Rs. 1.7 Billion Hawala Network
Court records paint a picture of a parallel financial pipeline running alongside formal banking. The court also convicted the two co-accused after concluding the prosecution had successfully established the charges against them.
Hawala and hundi systems let money move across borders without ever touching a regulated bank. That’s precisely what makes them attractive for large, undocumented transfers — and precisely why the State Bank and FIA treat them as serious violations rather than administrative slip-ups.
Not the First Conviction: The Rs. 1.6 Billion Money Laundering Case
This isn’t Khalil ur Rehman’s first brush with conviction. The latest ruling comes just months after he was sentenced to 10 years in prison in a separate Rs1.6 billion money laundering case.
That earlier verdict, delivered in March 2026 by Accountability Court Judge Nasrullah Minallah, was far harsher. The judge ruled that transferring money abroad through hawala and hundi networks constitutes a serious financial crime that undermines the integrity of the country’s financial system, and the court ordered confiscation of assets including vehicles, multiple properties across Rawalpindi, Quetta, Gujranwala, Peshawar and Karachi, and six bank accounts held at Askari Bank, Allied Bank and Meezan Bank.
Investigators told the court the hawala and hundi operations had reportedly been running since 2007 — nearly two decades of alleged informal fund movement before enforcement caught up.
NAB’s Widening Crackdown on Bahria Town
This week’s conviction lands amid a much bigger squeeze on the group. Earlier this week, the National Accountability Bureau took physical possession of Karachi’s Bahria Icon Tower, estimated to be worth around Rs100 billion, as part of an ongoing anti-money laundering investigation.
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That’s not an isolated move. In recent months, NAB has also frozen 3,150 acres of land acquired for Bahria Town in Jamshoro district, the 67-acre villa of Malik Riaz’s son Ali Riaz, and four other high-value Bahria Town properties on the directions of an accountability court.
Together, these actions suggest a coordinated, sustained investigation rather than a single case running its course.
Malik Riaz’s Legal Troubles Deepen
Bahria Town’s founder faces his own separate reckoning. Malik Riaz continues to be declared an absconder in the Al-Qadir Trust case, a matter tied to allegations that jailed former prime minister Imran Khan received land as a bribe during his premiership.
Separately, NAB has accused Ahmed Ali Riaz, the CEO of Bahria Town, and his wife Mubashara Ali Malik of holding foreign bank accounts in Silver Bank, Mauritius, and Interpol has issued Red Notices for Malik Riaz Hussain and his son at NAB’s request over money laundering allegations exceeding Rs700 billion.
Expert and Company Reaction
The FIA has framed the conviction as part of a broader enforcement mandate. The agency said the conviction underscores its commitment to pursuing money laundering, illegal foreign exchange operations, and hawala-hundi networks without discrimination.
Bahria Town’s side of the story reads very differently. Acting CEO Muhammad Ilyas wrote to Army Chief Field Marshal Asim Munir alleging the company was facing “discriminatory” treatment and that its assets were being auctioned off at throwaway prices.
He requested an independent, transparent review of the auction process and warned that the rushed sale of properties was causing “irreparable loss” to ordinary citizens who had invested their life savings in Bahria Town projects.
ProPakistani noted it had reached out to Bahria Town for an official response specifically on this FERA verdict; no statement had been issued at the time of the ruling.
What This Means for Bahria Town Investors
For thousands of plot holders and investors, the immediate legal drama matters less than the practical fallout. Frozen land, seized towers, and jailed executives raise real questions about project delivery timelines and asset security going forward.
The one-year sentence in this particular case is comparatively light next to the 10-year term Rehman is already serving. But its real weight lies in what it confirms: regulators are treating Bahria Town’s financial conduct as a pattern, not an isolated lapse, and the group’s legal exposure is still growing rather than winding down.
