Special status allowed bribes and fraud

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The Independent Online
BCCI was established by a Pakistani businessman, Agha Hasan Abedi, in 1972 as a Third World bank that was beyond the reach of any regulator and could not be nationalised, writes Larry Black.

Court documents filed by the Manhattan District Attorney yesterday suggest how that special status allowed it to bribe finance ministers and central bankers to get access to deposits and to help corrupt governments defraud the World Bank and the International Monetary Fund.

In Pakistan, Senegal, Zambia and Nigeria, for example, BCCI is accused of helping governments evade IMF and World Bank fiscal contraints, lending them millions of dollars to inflate their apparent foreign currency reserves.

In Peru, Argentina and Nigeria, BCCI is said to have bribed the presidents of central banks, getting them to place hundreds of millions of dollars in deposit at the bank, or to use it for foreign exchange trading, or allow it to establish deposit-taking branches.

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