The collapse of confidence in the Dewan Group during 2008 was only the beginning. By 2009, the focus shifted from bankers and rival industrialists to the regulators: the State Bank of Pakistan (SBP), the National Accountability Bureau (NAB), and the Securities and Exchange Commission of Pakistan (SECP). Where once the Dewans could rely on quiet settlements and discreet phone calls, now they faced formal inquiries, recovery suits, and public grilling. For Yousuf Dewan, it was no longer a battle of boardrooms and balance sheets—it was survival against an entire regulatory state that had turned hostile.
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Scene 1: Summoned to the State Bank
The notice came without warning. A letter embossed with the State Bank's insignia arrived at Dewan House, ordering Dewan Yousuf to appear before the Governor's office in Karachi.
Inside the State Bank's imposing building on I.I. Chundrigar Road, Yousuf sat across from Governor Shamshad Akhtar, one of the most powerful women in Pakistan's financial establishment.
Shamshad Akhtar (firmly, adjusting her glasses):
"Mr. Dewan, the banking system is under immense stress. Your group's liabilities across multiple banks exceed Rs. 40 billion. The non-performing loans attached to your companies threaten to destabilize our books. We cannot allow this to continue unchecked."
Yousuf (calmly, though visibly tired):
"Governor Sahiba, with respect, these liabilities are not a result of mismanagement. They are the outcome of external shocks—the rise in oil prices, political instability, and most importantly, the government's shift in policies. We have always worked within the framework of the law."
Shamshad (shaking her head):
"Intentions aside, the numbers don't lie. Your cement plants are operating at 30% capacity, your auto division has ceased assembly, and your financial commitments to banks remain unmet. We cannot risk contagion. You must present a restructuring plan within thirty days, or we will direct the banks to proceed with aggressive recoveries."
Yousuf nodded, his mind racing. The thirty-day deadline was not a negotiation; it was a warning.
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Scene 2: Behind Closed Doors at SECP
At the SECP's Islamabad headquarters, a meeting was underway between Chairman Razi-ur-Rehman Khan and senior commissioners.
Commissioner:
"Sir, the Dewan Group's listed companies have failed to release timely annual reports. There are discrepancies in their declared assets. Investors are panicking."
Razi-ur-Rehman Khan (gravely):
"We cannot turn a blind eye. If we fail to act, we will be accused of protecting cronies. The PPP government already faces accusations of corruption; we must demonstrate independence."
Another Commissioner:
"But sir, the Dewans have powerful allies in Sindh. Taking direct action could backfire politically."
Razi (decisively):
"Then let it backfire. Issue them notices under the Companies Ordinance. Freeze their ability to raise capital until they comply."
The decision was unanimous. The Dewans were to be publicly cornered by regulatory action, stripping them of one of their last defenses—access to capital markets.
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Scene 3: NAB Knocks on the Door
In Karachi, the National Accountability Bureau, under the directorship of Lt. Gen. (Retd.) Shahid Aziz, began digging into the Dewan Group's loan portfolio. Files were pulled from banks, interviews were conducted, and whispers began to circulate in the media that NAB was preparing references.
One afternoon, two NAB officers arrived at Dewan House with formal summons.
NAB Officer (coldly):
"Mr. Dewan, you are required to appear before the Accountability Court to answer charges of willful default. Failure to do so will result in arrest."
Yousuf, holding the paper in his hands, muttered under his breath:
Yousuf:
"So, it has come to this."
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Scene 4: The Lawyers' Strategy
Inside the offices of Haidermota & Co., one of Karachi's most prestigious law firms, Yousuf sat with senior partner Syed Hyder Ali Mota.
Hyder Mota (leaning back in his chair):
"Yousuf Bhai, NAB's case is weak legally but strong politically. They will frame this as 'willful default'—that you borrowed with no intention of repayment. Our defense will be simple: demonstrate that your defaults are a result of systemic shocks, not intention. But be prepared, they will drag this out for years."
Yousuf (weary):
"Years I can handle. Jail, I cannot."
Hyder Mota (soberly):
"Then you must prepare for compromise. The banks, the regulators, even NAB—they all want the same thing: assets. If you release control of certain plants, they may back off."
Yousuf's face hardened. For a man who had built his empire brick by brick, the thought of surrendering it was unbearable.
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Scene 5: Political Maneuvering
Behind the scenes, Yousuf sought help from political allies in Sindh. One evening, he met with Dr. Zulfiqar Mirza, a PPP heavyweight, at a private dinner in Karachi.
Yousuf (pleading):
"Zulfiqar Bhai, you know my family's history. We supported the PPP when others abandoned it. Why is your government letting these regulators destroy us?"
Zulfiqar Mirza (sighing):
"Yousuf, it's not personal. Zardari Sahib needs liquidity, and he trusts people like Mansha and Arif Habib more than he trusts you. You're seen as too independent. The regulators are acting under pressure, not just from the government but from the IMF. There is little I can do."
Yousuf (bitterly):
"So loyalty counts for nothing."
Zulfiqar:
"In politics, loyalty lasts only as long as it is useful."
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Scene 6: The Accountability Court
The Accountability Court in Karachi was packed the day Dewan Yousuf appeared. Journalists crowded outside, cameras flashing.
Inside the courtroom, the NAB prosecutor laid out the case.
Prosecutor:
"Your honor, the Dewan Group borrowed billions from state-owned banks and has failed to repay. This constitutes willful default, a crime under the NAB Ordinance. We seek authorization to seize their assets."
Defense Lawyer (rising calmly):
"Your honor, these allegations are baseless. The Dewan Group's defaults are a result of economic collapse and policy shifts, not criminal intent. To brand an industrialist as a criminal for failing under impossible conditions is an injustice to the entire business community."
The judge listened silently, his face unreadable. After hours of arguments, he adjourned the case, leaving Yousuf in limbo.
Outside the court, reporters shouted questions.
Journalist:
"Mr. Dewan, are you guilty of corruption?"
Yousuf (angrily):
"I am guilty of believing in Pakistan's economy. Nothing more."
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Scene 7: Rival Celebrations
While Yousuf battled regulators, his rivals watched with satisfaction. At the Lahore offices of Nishat Group, Mian Mansha discussed developments with his advisors.
Mansha (smiling):
"The regulators are doing what the markets could not—breaking the Dewans. With them out of the picture, we can expand our footprint in cement and finance without competition."
Advisor:
"Sir, do you fear the same treatment in the future?"
Mansha (confidently):
"No. We are too big, too entrenched, and too aligned with the powers that be. The Dewans overplayed their hand. I won't make that mistake."
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Scene 8: The Human Toll
As the cases dragged on, the Dewan family felt the toll. At home, Yousuf's wife confronted him.
Wife (tearfully):
"Our phones don't stop ringing. Relatives ask when we will pay back their investments. The newspapers humiliate us daily. How much longer can we endure this?"
Yousuf (quietly, holding her hand):
"As long as it takes. empires fall, but we will survive. I will not let them reduce us to beggars."
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Scene 9: A Glimmer of Hope
In late 2009, a proposal emerged from a consortium of banks for a Debt Restructuring Agreement. Under the plan, Dewan Group's loans would be rescheduled over 10 years, but only if Yousuf pledged certain cement plants as collateral.
At a high-stakes meeting in Karachi, the lead banker addressed him:
Banker:
"Mr. Dewan, this is your lifeline. Accept it, and you live to fight another day. Refuse, and the regulators will strip you bare."
Yousuf sat in silence, the weight of the decision crushing him.
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Closing Reflections
By the end of 2009, the Dewan Group was no longer the untouchable empire it once was. Facing regulators on all fronts—the State Bank, SECP, and NAB—Yousuf had been forced into a corner. The fight was far from over, but the message was clear: the age of unregulated expansion was gone. In its place stood a new era, where survival meant compromise, and where every move was scrutinized by a state apparatus eager to make examples.
For Yousuf, the regulators were not just officials in suits—they were the executioners of an empire.