Srinagar-born Kashmiri separatist leader Syed Ghulam Nabi Fai, who in December admitted to being an ISI agent, was sentenced on Friday to 24 months in prison, followed by three years of supervised release, for conspiracy and tax violations in connection with a decades-long scheme to conceal the transfer of at least $3.5 million from for the government of Pakistan to fund his lobbying efforts in America related to Kashmir.
On December 7, 2011, 62-year-old Fai, undisputedly one of the most influential Kashmiri Americans in the country and founder of the Kashmiri American Council, had pleaded guilty to two-count criminal information.
Count one of the information charged Fai with conspiracy to: 1) falsify, conceal and cover up material facts he had a duty to disclose in matters within the jurisdiction of executive branch agencies of the US government; and to 2) defraud the Treasury Department by impeding the lawful functions of the IRS in the collection of revenue.
According to court documents filed with his plea agreement, although ostensibly the KAC held itself out to be run by Kashmiris, financed by Americans, and dedicated to raising the level of knowledge in the United States about the struggle of the Kashmiri people for self-determination, it was secretly funded by officials employed by the government of Pakistan, including the ISI.
Neil MacBride, attorney for the eastern district of Virginia, in announcing the sentencing said, "Fai spent 20 years operating the Kashmiri American Council as a front for Pakistani intelligence. He lied to the Justice Department, the IRS and many political leaders throughout the United States as he pushed the ISI's propaganda on Kashmir."
Lisa Monaco, assistant attorney general for national security, said, "Syed Fai is today being held accountable for his role in a decades-long scheme to conceal the fact that the government of Pakistan was secretly funding his efforts to influence US policy on Kashmir."
Laying out the scheme adopted by Fai, the government said that Fai admitted in court that, from 1990 until about July 18, 2011, he conspired with others to obtain money from officials employed by the government of Pakistan, including the ISI, for the operation of the KAC in the United States, and that he did so outside the knowledge of the US government and without attracting the attention of law enforcement and regulatory authorities.
To prevent the Justice Department, FBI, Department of Treasury and the IRS from learning the source of the money he received from officials employed by the government of Pakistan and the ISI, it said, Fai made a series of false statements and representations, according to court documents.
For example, Fai told FBI agents in March 2007 that he had never met anyone who identified himself as being affiliated with the ISI and, in May 2009, he falsely denied to the IRS on a tax return for the KAC that the KAC had received any money from foreign sources in 2008.
In addition, according to court documents, Fai sent a letter in April 2010 to the Justice Department falsely asserting that the KAC was not funded by the government of Pakistan. Later that year, Fai falsely denied to the IRS that the KAC had received any money from foreign sources in 2009. In July 2011, Fai falsely denied to FBI agents that he or the KAC received money from the ISI or government of Pakistan.
In fact, Fai repeatedly submitted annual KAC strategy reports and budgetary requirements to Pakistani government officials for approval. For instance, in 2009, Fai sent the ISI a document entitled "Plan of Action of KAC / Kashmir Centre, Washington, DC, for the Fiscal Year 2010," which itemised KAC's 2010 budget request of $658,000 and listed Fai's plans to secure US congressional support for US action in support of Kashmiri self-determination.
Fai also admitted that from 1990 until about July 18, 2011, he corruptly endeavoured to obstruct and impede the due administration of the internal revenue laws by arranging for the transfer of at least $3.5 million to the KAC from employees of the government of Pakistan and the ISI.
According to court documents, Fai accepted the transfer of such money to the KAC from the ISI and the government of Pakistan through his co-defendant Zaheer Ahmad and middlemen -- straw donors --, who received reimbursement from Ahmad for their purported "donations" to the KAC.
Fai provided letters from the KAC to the straw donors documenting that their purported "donations" to the KAC were tax deductible and encouraged these donors to deduct the transfers as "charitable" deductions on their personal tax returns.
Fai concealed from the IRS that the straw donors' purported KAC "donations" were reimbursed by Ahmad, using funds received from officials employed by the ISI and the government of Pakistan.
The KAC board of directors in a statement, immediately following the sentencing of Fai, expressed "its satisfaction at the conclusion of the proceedings" and noted that it "appreciates the process followed by the government in bringing the matter to conclusion, and expresses its faith in the judicial system".
The board said, "They specifically appreciated the government's voluntary withdrawal of FARA (Foreign Agents Registration Act)charges attempting to brand Dr Fai, and by default the KAC, an agent of a foreign government," and claimed that "the KAC is, was and always has been an independently organised and Kashmir-focused organisation".
In its statement, the KAC said, "The Board reaffirms its unflinching dedication and commitment to the cause of the freedom for Kashmir, and pledges to continue its work unabated. It confirms its faith in the principles set forth in repeated United Nations unimplemented resolutions granting Kashmiris their right to self-determination, and added that it "seeks a peaceful resolution of the Kashmir issue, in accordance with the wishes and aspirations of the Kashmiri people."
The KAC, established in 1990, would regularly hold press briefings at the National Press Club and host conferences, including a major annual conference on Capitol Hill, which would be attended by influential US lawmakers, including members of the House Foreign Affairs Committee like Congressman Dan Burton, Indiana Republican and a longtime bete noire of New Delhi,Congressman Joe Pitts, Pennsylvania Republican and Jim Moran, Virginia Democrat who would bemoan the situation in the Valley and the alleged gross human rights abuses there being perpetrated by Indian security forces and para-military groups.
These conferences would also always be attended by the Pakistan ambassador to the US, and senior Pakistan government officials as well as legislators like Mushahid Hussain --also a leading journalist were regulars. Till he was fired for his role in 'Memogate,' Pakistani ambassador Husain Haqqani was a conspicuous presence at Fai's Capitol Hill conferences, as were earlier ambassadors like Maleeha Lodhi, who was present at the most recent parley too, while being a research fellow at the Woodrow Wilson Centre.
These conferences have also been able to draw some of the leading South Asian experts and former diplomats like Howard Schaffer, a 36-year veteran of the US Foreign Service and the author of the recently published seminal book on American diplomacy and intervention in Kashmir, The Limits of Influence: America's Role in Kashmir, published by the Brookings Institution.
Fai had also over the years, hosted some Indian journalists at these conferences too, taking care of all their travel and expenses and lodging and also appearing at these conferences have been some Indian American academics and scholars like Professor Angana Chatterjee.
Indian embassy officials, including the Indian Ambassador to the US, had also over the years been religiously invited by Fai to attend and speak at these annual conferences, but as far as this correspondent can remember, not a single embassy official ever attended these conferences, let alone speak at these two-day parleys.
These Capitol Hill conferences also almost always were attended by the Prime Minister and former prime ministers and senior officials of Pakistani-occupied Kashmir and whenever Kashmir leaders like Mirwaiz Farooq, former Jammu and Kashmir Liberation Front leader Yasin Malik, or the hierarchy of the All Parties Hurriyet Conference visited Washington, they usually stayed with Fai at his Fairfax home and are taken around by him to meet with US lawmakers, and administration officials and address seminars and forums at Washington, DC think tanks.
Fai also constantly travelled around the world, delivering speeches, and regularly visits Vienna and Geneva to appear before the UN Human Rights Council to make a case on behalf of the people of Jammu and Kashmir and the constant violation of their human and civil rights by the government of India and the military and paramilitary troops in the Valley. Over the years, he has also been a regular speaker at universities and colleges across the US.
Following Fai's arrest on July 19 last year, after which he was put under house arrest at his Fairfax home, initially his defence stated that he was not an agent of the ISI and that all of the lobbying he did as the head of the KAC was his own and the monies the KAC received were from donors who were Kashmiri Americans and supporters of the separatist cause.
But, facing an iron-clad case, which the prosecutors presented with mountains of evidence of monies received for his illegal lobbying from the ISI and the unravelling of the network of straw donors through which this money was funnelled, his defence team saw the writing on the wall and agreed to a guilty plea agreement, evidently hoping that it could necessarily lead to a lighter sentence, and were hopeful that the judge would also take Fai's ill-health into consideration.
Two years ago, Fai suffered a stroke and was not expected to recover but not only did he recuperate significantly but also came to take the reins of the KAC and continue organising the annual Capitol Hill conferences and engage in his extensive travel overseas to espouse the separatist cause.
At the time, law enforcement sources told rediff.com that if he had not entered into the plea agreement and the case had gone to trial, the prosecution with its iron-clad evidence and several affidavits by witnesses could have asked for the maximum sentence of five years in prison if convicted.The sources at the time said it is likely that Fai, who was then set free on bond, would get off with a considerably lighter sentence which could even not include any incarceration but a kind of house arrest in a half-way house with a couple of years probation time, but evidently the judge thought otherwise and sentenced him to two years in jail, followed by three years of supervised release.