Reply #12: I keep thinking someone needs to look closely at the FBI [View All]

[starroute]

There's been a lot of fluky stuff associated with the FBI since Robert Mueller became director in July 2001, starting with the anthrax attacks, and I keep having the feeling that the roots of it lie in Mueller's role in the BCCI coverup. BCCI is in many ways the template for everything that's been happening since, from Enron to the banking scandals, and Mueller's role then and since deserves a lot more scrutiny than it's ever gotten (or is likely to get when he's up for re-nomination next year.)

Here's something that appeared in Opinion Journal prior to his confirmation.

http://www.mail-archive.com/[e-mail]/msg71516.html

June 26, 2001

BCCI holds important lessons for the future. Our dawning century is one of international criminal gangs operating with increasing sophistication in a shadowy world beyond the control of fragmented national authorities. The banking and political systems are particularly vulnerable to this sort of corruption. BCCI is a prototype for this new form of global crime. . . . Both Mr. Terwilliger and Mr. Mueller were senior Justice Department officials when BCCI got away. Mr. Terwilliger was Deputy Attorney General; and Mr. Mueller ran the Criminal Division at Main Justice from 1990 to 1993. When it came to making decisions about investigations and prosecutions in the BCCI affair they were the men at the switches. Only the Attorney General and the President had higher federal authority. Mr. Terwilliger apparently is off the short list because confirmation would be complicated by his legal work for Mr. Bush in the Florida election dispute.

This means the presumed front-runner is Mr. Mueller, who took personal charge of the BCCI probe. If he is nominated, a number of questions need to be asked. How did BCCI manage to gain entry into the U.S. banking system and acquire First American? Did the U.S. intelligence community grease the skids for BCCI at critical junctures? Was the Justice Department part of the solution to the BCCI mess, or part of the problem?

When Mr. Mueller took over the Criminal Division, critics in Congress and the media were already raising questions about Justice and BCCI. He stepped into this breach, telling the Washington Post in July 1991 that maybe indeed there was an "appearance of, one, foot-dragging; two, perhaps a coverup." He denied the coverup claims, specifically rejecting a Time magazine report that the U.S. government was seeking to obscure its role in the scandal partly because the CIA may have collaborated with the bank's operatives. Perhaps Justice should have been more enthusiastic and aggressive about the case, he told the Post, but "nobody has ever accused me of lacking aggression."

Still, the problems with Justice persisted. And the timing of some of Mr. Mueller's moves raised eyebrows. In September 1991, Justice indicted six BCCI figures and a reputed Colombian drug lord on racketeering charges. The indictment was unveiled just minutes after then-Congressman Charles Schumer issued a report sharply critical of Justice Department handling of the case. As Peter Truell and Larry Gurwin noted in their authoritative book, "False Profits: Inside BCCI," the indictment was merely "warmed-over information from an investigation that had ended nearly two years before."

And here's that Time Magazine article it refers to:

http://www.time.com/time/magazine/article/0,9171,974560,00.html

It was the ultimate package deal, a grand compromise designed to clean up one of the world's messiest piles of financial wreckage. Bank liquidators, acting on behalf of the moribund Bank of Credit & Commerce International, marched into a crowded Manhattan courtroom last Friday and settled, in one unexpected swoop, all U.S. criminal charges outstanding against B.C.C.I. as a corporation. The bank, which in the U.S. is now essentially just a hollow shell, pleaded guilty to federal and state charges of racketeering, fraud and money laundering. The liquidators agreed to surrender virtually every penny of B.C.C.I.'s assets in the U.S., a total of $550 million, which represents the largest criminal forfeiture in history.

The guilty plea, hammered out during four months of intense negotiations among banking authorities and prosecutors in Washington, London and Luxembourg, was designed in part to impose some order on the worldwide scramble to lay claims to B.C.C.I.'s remaining assets. So far, auditors have found only $1.5 billion in the coffers of a bank that once held $22 billion in deposits. "We felt we could duke it out for years, or we could accommodate each other. I think we found a fair arrangement," says George Terwilliger, the acting Deputy U.S. Attorney General.

Terwilliger is an interesting figure in his own right. He was one of the younger Bush's lawyers during the 2000 recount, which is what disqualified him from the FBI job. He has also been pushing the fake "voter fraud" issue since 1997 and in 2003 co-founded a group called Americans for a Better County (along with Republican operatives Frank Donatelli and Craig Shirley) that was intended to provoke an FEC ruling curtailing the activities of Democratic soft money groups. The last I know of him was in 2007, when he was testifying on behalf of Alberto Gonzales in the US Attorney scandal and then serving as his criminal defense lawyer.

But Mueller has managed to keep well away from that sort of partisan activity and is still very much with us.