BCCI UK class action: latest press cuttings update

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From the UK's 'Independent'

'Insult to Arabs' by Bank official in BCCI case
By Katherine Griffiths, Banking Correspondent
17 February 2004


Brian Quinn, now chairman of Celtic football club, told colleagues at the Bank of England, where he used to be head of banking supervision, that Arab businessmen were liars, the High Court heard yesterday.Mr Quinn, who became head of banking supervision in 1986, had a "strongly held view based on his experience of Arabs" that they "would give assurances which were not worth the paper they were written on", a Bank official wrote in a memo.His opinion is the latest disparaging comment about foreigners allegedly stated by high-ranking officials of the Bank that has come to light in the trial over the collapse of BCCI, founded by the Pakistani financier Agha Hasan Abedi.

It has already emerged that another official referred to his counterparts at regulatory bodies in other parts of the world as "wogs" in 1978.Mr Quinn, one of the prominent former employees of the Bank who will be called to give evidence, allegedly expounded his views about Arabs in the early 1990s. A spokeswoman for Celtic FC said yesterday Mr Quinn could not comment because the case was ongoing. At the time, the Bank was trying to persuade the Abu Dhabi government to take on regulation for BCCI, which had operations in the Gulf but which was seen by many as having its head office in Leadenhall Street in the City. According to documents read out in court yesterday, Mr Quinn decided officials from the Bank should not visit Abu Dhabi to persuade its authorities to get more involved in policing BCCI because of their untrustworthiness and because he did not want to be seen to be going on a "begging mission".

BCCI collapsed in July 1991 after an escalating blackhole was discovered in its accounts by its auditor, PricewaterhouseCoopers. It owed more than £5bn to 80,000 depositors.Its liquidators, Deloitte & Touche, are suing the Bank for £1bn for allegedly putting depositors' money in danger by failing to monitor BCCI properly. The Bank also decided to withhold crucial information from the Treasury about the state of BCCI's finances in 1990, Mr Pollock, the creditors' QC, alleged. He cited a note written by Helen Jones, an employee of the Bank, in June 1990, which said: "Following the House of Lords debate, and the revelation that ministers may reveal what they know in the House, it was decided we would be very careful how much detailed information we passed on to the Treasury."

From: http://news.independent.co.uk/business/news/story.jsp?story=492097


From London 'Evening Standard', 16 February 2004:
(sorry no online link)

Bank of England Memo 'urged secrecy on BCCI':

The Bank of England hid evidence from the Treausury that rogue trader BCCI was on the verge of bankruptcy in the months before its £9billion collapse, the high Court heard today. A memo by BoE analyst Helen Jones in June 1990 outlined what limits should be put on its disclosures to the Treasury.......

<snip>

Gordon Pollock QC, for Deloitte, said that in a note to a superior about a pending House of Lords debate on BCCI, Jones warned: 'Ministers may reveal what they know in the House. It was decided we would be very careful about how much detailed information we passed on to the Treasury'. Pollock said: 'The truth was you had a bank in Luxembourg and massive black holes have started appearing'. Pollock said that by 1990 BCCI auditor Price Waterhouse was so concerned about BCCI that it did not want its chief executive Swaleh Naqvi to attend an international banking meeting. The hearing continues.
<snip>
end


From: Nepalnews.com:


The BCCI collapse, described by Britain’s Serious Fraud Office (SFO) as “the biggest fraud in banking history,” sent shockwaves through London’s cosy financial establishment long before recent scandals such as Enron and Parmalat.

<snip>

http://www.nepalnews.com.np/contents/englishmonthly/businessage/2004/feb/world.htm


From: New Statesman (UK)

In the dock: the Bank of England
Nick Cohen
February 16 2004


<snip>:

Long before Enron, there was the BCCI scandal. Now a court case reveals the shameful role played by regulators and accountants. And it could easily happen again. By Nick Cohen

About the only line that wasn't shocking in the reports of how Abdul Qadeer Khan, Pakistan's foremost nuclear scientist, had sold nuclear technology to Iran, Libya and North Korea was the line which said that he had once used the Bank of Credit and Commerce International (BCCI) to funnel payments from the buyers to the suppliers of weapons of mass destruction. To anyone familiar with the history of fraud, nothing could be more natural. Obviously, the bank of the Palestinian terrorist Abu Nidal, the Panamanian dictator General Manuel Noriega, and assorted heavies from Colombian drug cartels would also be the bank of choice for men prepared to contemplate the extermination of hundreds of thousands of people. If it was good enough for the CIA when it was funding the Islamist maniacs in Afghanistan who were to turn into al-Qaeda, and for Ronald Reagan when he and Ayatollah Khomeini were arming the Contras in Nicaragua, it would be good enough for Khan. There was scarcely a conspiracy in the 1980s that did not involve BCCI. Its presence at a crime scene was close to a given.

<snip>
from:
http://www.newstatesman.com/site.php3?newTemplate=NSTemplate_Economy&newTop=Section%3A+Economy+Index&newDisplayURN=Section%3A+Economy+Index

Another link:
http://www.ex.ac.uk/~RDavies/arian/scandals/classic.html#bcci


From: Pakistan Facts


Pakistan investigates BCCI role in sale of nuclear knowhow
Wednesday, February 04 2004 @ 06:11 PM CST
Stephen Fidler and Farhan Bokhari


The Pakistani government is examining records of the failed Bank of Credit and Commerce International in its investigation into the role Pakistani scientists may have played in selling nuclear knowhow to Iran, North Korea and Libya. According to bankers, some of whom worked with BCCI before it collapsed in 1991, Pakistani investigators have sought the help of former BCCI employees to try to uncover payments made to scientists connected with Pakistan's nuclear programme. BCCI's role in financing Pakistan's own nuclear efforts has long been the subject of scrutiny. In 1992, a report into BCCI from a US Congressional sub-committee headed by Senator John Kerry, now a leading Democratic presidential contender, said "there is good reason to conclude that BCCI did finance Pakistan's nuclear programme". Though it said the issue deserved further investigation, there was little public follow-through.

This year, however, as evidence has mounted that Pakistani scientists helped the uranium enrichment programmes of Iran, North Korea and Libya, the Pakistani government has launched an investigation. A government spokesman in Islamabad said that anybody found to have passed on secrets would be punished, but denied that the government approved any transfers. At least 11 Pakistani scientists and officials - as well as the so-called father of the Pakistani nuclear bomb, Abdul Qadeer Khan - have been questioned.

BCCI helped the Pakistani government under General Zia ul Haq, the military dictator killed in a 1988 plane crash, to channel payments from the US Central Intelligence Agency to fighters seeking to oust Soviet troops from Afghanistan. Soviet troops withdrew in 1989 but former BCCI officials said the relationship for organising undocumented payments for influential Pakistanis continued until the bank's collapse. One former BCCI banker who said he organised funds transfers on behalf of senior military officers in the Zia regime commented: "I'm not surprised that the Pakistanis are now looking to put together dossiers on some of their scientists receiving payments through BCCI." He said that over the past two months, Pakistani officials had travelled to the Middle East, looking for evidence of nuclear scientists receiving payments through BCCI.

Another former BCCI banker said that establishing payments to Pakistani nuclear scientists through the bank could provide evidence about the so far undocumented role of senior former Pakistani military officers in overseeing the transfer of nuclear knowhow to other countries. The investigation has prompted speculation among western intelligence officials and diplomats over the extent to which General Zia, leader of a frontline anti-communist state, in fact sanctioned the transfer of nuclear knowhow to Iran. In the past four to eight weeks, he said the Pakistani investigators have been seeking evidence of payments made to Mohammad Farooq, one of the nuclear scientists at the centre of the investigation. Pakistani officials are said to have focused on Mr Farooq as a possible contact between the Iranians and Mr Khan.

<snip>
http://www.pakistan-facts.com/article.php/20040204181106258

From: Newsmax

<snip>

Kerry was also much involved in investigating the BCCI scandal that peaked in 1992. In an investigative summary, Kerry and associates concluded that many investigative leads remain to be explored, including the alleged relationship between the late CIA director William Casey and BCCI; the extent of BCCI’s involvement in Pakistan’s nuclear program; BCCI’s manipulation of commodities and securities markets in Europe and Canada; the use of BCCI by central figures in the alleged “October Surprise;” its involvement with foreign intelligence agencies; the financial dealings of BCCI directors with Charles Keating, including the possibility that BCCI related entities may have laundered funds for Keating to move them outside the U.S.; BCCI’s financing of commodities and other business dealings of international criminal financier Marc Rich…

http://www.newsmax.com/archives/articles/2004/2/2/221052.shtml

NB: Marc Rich was the Clinton supporter who was pardoned when Clinton left office, after pleas from his ex-wife Denise....

From Liberation News Service:

<snip>

What was BCCI? Only "one of the largest criminal
enterprises in history," according to the U.S. Senate.
What did BCCI do? "It engaged in pandemic bribery of
officials in Europe, Africa, Asia and the Americas,"
says journalist Christopher Bryon, who first exposed
the operation. "It laundered money on a global scale,
intimidated witnesses and law officers, engaged in
extortion and blackmail. It supplied the financing for
illegal arms trafficking and global terrorism. It
financed and facilitated income tax evasion, smuggling
and prostitution." Sort of an early version of the
Bush Regime, then.

BCCI's bipartisan corruption first permeated the
Carter Administration, then came to full flower in the
Reagan-Bush years. The CIA uncovered the bank's
criminal activities in 1981--no great feat,
considering how many of its own foreign "associates"
were involved, including the head of Saudi
intelligence, Kamal Adham, brother-in-law of King
Faisal. But instead of stopping the drug-runners and
terrorists, the agency decided to join them, using
BCCI's secret channels to finance "black ops" all over
the world.

When a few prosecutors finally began targeting BCCI's
operations in the late Eighties, President George
Herbert Walker Bush boldly moved in with a federal
probe directed by Justice Department investigator
Robert Mueller. The U.S. Senate later found that the
probe had been unaccountably "botched"--witnesses went
missing, CIA records got "lost," all sorts of bad
luck. Lower-ranking prosecutors told of heavy pressure
from on high to "lay off." Most of the big BCCI
players went unpunished or, like Mahfouz, got off with
wrist-slap fines and sanctions. Mueller, of course,
wound up as head of the FBI, appointed to the post in
July 2001--by George W. Bush.

In the late 1990s, U.S. authorities identified Mahfouz
as a major financier of his brother-in-law's
extracurricular activities. He denied it, but the
spooked Saudis put him on ice, charging him with, of
all things, bank fraud. He's now under "house
arrest"--or rather, "palatial mansion arrest"--but
still wheeling and dealing with Kean and Delta and
other worthies. Indeed, one of Mahfouz's
hirelings--the director of a Pakistani bank he
owns--sits on the advisory board of our old friend the
Carlyle Group, cheek by jowl with the firm's most
celebrated shill: George Herbert Walker Bush.

http://www.mindspace.org/liberation-news-service/archives/000510.html



From 'The Herald':
<snip>

Celtic chief ‘was aware of rogue bank problem’
KARL WEST, City Editor February 11 2004

CELTIC chairman Brian Quinn was aware that BCCI posed a "dangerous" problem for the Bank of England in 1987, four years before the rogue bank collapsed owing billions to creditors.On an internal Bank of England document, dated February 4, 1987, the High Court in London was told yesterday that Mr Quinn had written: "I am convinced that it would be v (very) dangerous for us to accept this as a UK bank. It is Luxembourg's problem; they must find a solution. Mr Quinn was head of banking supervision at the Bank of England at the time the Bank of Credit and Commerce International collapsed in 1991, with debts of at least £7bn.

Deloitte is pursuing the Bank of England on behalf of 70,000 creditors. It alleges the rare civil offence "misfeasance in public office". Bank of England officials are accused of "knowingly or recklessly" failing properly to police BCCI. The Bank of England argues that, as BCCI was headquartered in Luxembourg, it fell to regulatory authorities there to supervise it. However, Gordon Pollock QC, for Deloitte, has argued that BCCI's principal place of business was in London, and therefore should have been policed by the Bank of England. Mr Pollock has attempted to show that members of the Bank's supervision team "shut their eyes and turned away" from the fraudulent activities.

Deloitte is seeking £1bn in damages for UK depositors to add to the £3.1bn so far recovered for creditors worldwide. They include Western Isles Council, which lost £24m, and Clackmannanshire Council, which lost nearly £1m. Mr Pollock said yesterday that Western Isles Council deserved sympathy because "it is a very small council and lost most of its budget".

The hearing continues.
From:

http://www.theherald.co.uk/news/9758.html

UK Serious Fraud Office update link:
http://www.sfo.gov.uk/news/prout/pr_72.asp?seltxt=Serious+Fraud+Office


I expect it's going to take at least another month before QC Gordon Pollock starts unveiling how BCCI was monitored in UN military operations to crack down on paedophile rings in Asia connected to organised crime cartels worldwide supplying terrorist groups with illicit weapons.

From personal affidavits seen, the Ruler of Oman, Sultan Qaboos does not come out too well from this investigation.

[SpiralHawk]

1. BushCo and BCCI -- tentacles of The Octopus

It's everywhere, it's everywhere.

kick

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2. Addendum to last sentence of posting:

Neither does the UK armed forces commander who trained the Oman National Guard and Qaboos's personal security team.