The Underworld's Bank of Choice

Article excerpt

THE story of the Bank of Commerce and Credit International (BCCI) is at once a great true crime tale and an ominous reflection on the times. It's a story worth knowing because, as New York District Attorney Robert Morgenthau remarked, his 1991 indictment of BCCI exposed "the largest bank fraud in world financial history." If that weren't enough, the millions of dollars BCCI's depositors lost through the bank's misdeeds symbolize the even greater crisis of global banking and the difficulties facing law enforcement in a world economy.

The bizarre charlatans who ran BCCI for two decades now seem like so much flotsam on international tides of capital and crime, but they began as idealists. Early in BCCI's history the self-proclaimed Bank of the Third World was extending services to Arab oil sheiks and hard-working Muslim immigrants in Europe, customers who were less than welcome at more conventional financial institutions. But eventually BCCI's arms-open approach meant that drug smugglers and embezzling dictators used the bank to launder millions in illegal profits.

As described in "Dirty Money" - a spicy and readable account of the scandal written by Mark Potts of the Washington Post, who worked with English financial journalists Nicholas Kochan and Robert Whittington - BCCI became "a sort of neighborhood bank in some of the world's worst neighborhoods."

At the head of the bank's macabre parade of spies, scamps, and thieves comes Agha Abedi - "Agha Sahib" to his devoted employees, who treated Abedi like a guru. A prodigy in the Pakistani banking community, Abedi had a genius for playing people's higher principles off their instinctive aversion to regulations and taxation. When Pakistan's banking industry was nationalized in 1972, Abedi went to his contacts in the newly powerful Arab oil world and raised enough money to begin his own bank: BCCI.

Mixing Sufi mysticism and dizzying ambition, Abedi exhorted his followers to go forth and multiply deposits.

"A Full Service Bank," a second account of BCCI's dealings, written by James Ring Adams of the Wall Street Journal and Douglas Frantz of the Los Angeles Times, is filled with wonderful examples of what the authors call "Abedi-speak." At business meetings, he urged employees to "feel the force" and think of their company as a spiritually united family. When getting new capital into the bank became a religious duty, trivia like securing loans or balancing books were seen as earthly obstacles to monetary transcendence. One law enforcement official later complained: "This is a cult, not a bank."

Through the late 1980s, BCCI's secrecy and hunger for cash made it the bank of choice for the underworld. Western intelligence agencies like the CIA and Israel's Mossad financed covert operations out of the bank's murky vaults, and terrorists like Abu Nidal massaged BCCI accounts to leverage arms deals. …