In a front-page story today, the paper said the report -- the result of a five-year-long probe conducted by Pakistan's Federal Investigation Agency (FIA) -- was delivered to President Mohammad Rafique Tarar last week. A copy of the report was also sent to Pakistan's Chief of Army Staff, Gen. Jehangir Karamat, who the paper claims, is on the brink of declaring martial law.

FIA investigators found a trail which, according to the paper, ``leads from his burgeoning business empire in the Asian republic to Switzerland, Washington, the British Virgin Islands, Saudi Arabia, Kuwait and then London.''

The FIA's 200-page report allegesthat the Sharif family's assets abroad include four flats in London's Mayfair, worth more than 3 million pounds, and over 40 million pounds in accounts and companies controlled by his family. The FIA investigation is said to have centered on the Sharif family's Ittefaq group of industries which grew at an amazing rate during Nawaz Sharif's first term in power in 1993.

The companies, the report alleged, received billions of rupees in bank loans which were never repaid and there is no record of where the money went. The Observer quotes the FIA report as saying that $8 million were sent to off-shore accounts by the Ittefaq companies and then returned as foreign exchange bearer certificates to 43 Sharif family members and friends. The report also alleges that a further $50 million is managed for the family in Switzerland.

According to the report, the Sharif family acquired properties in London through two companies, Nescoll and Nielson Enterprises, registered in the British Virgin Islands and linked toa bank account in Lahore in the name of a fictitious person: Sulman Zia. The four flats in Avendale House in Park Lane are said to be worth at least 750,000 pounds each.

Of these No 17 Avendale House is the only one that Sharif admits to owning.Acquiring property in London appears to be standard practice with Pakistani politicians. Benazir Bhutto also facing corruption investigations was also revealed to have bought property here.

The report, according to The Observer, says that through Sulman Zia and other fake accounts, money originating in five banks in Pakistan, Switzerland and Saudi Arabia was used to secure loans to two Ittefaq group companies -- Hudabiya Paper and Hudabiya Engineering -- when Sharif was out of power. The report says that money from these fake accounts also goes to companies controlled by a Washington-based Pakistani businessman who has been awarded lucrative contacts to ship wheat to Pakistan.

Sharif is now in London and The Observer confronted him as he left oneof the Mayfair flats. They asked him what he thought of the allegations and he refused to comment. He demanded to know, ``Where is Malik? Do you know him ?'' Malik is Rehman Malik, Pakistan's second highest ranking police office who has led the investigation against Sharif and his family.

The allegations