The Case That Kerry Cracked

By Lucy Komisar, AlterNet. Posted October 22, 2004.

One gets an eerie sense of déjà vu watching John Kerry battle the Bush clan. He’s done it once before, against the old man, President Bush’s father, though many voters have probably forgotten. That battle involved the first Bush administration’s attempt to put the lid on an investigation that connected a worldwide criminal bank to narco-traffickers, terrorists, and to Middle East money men who helped the Bush family make piles of cash. Those links connect to people now on the U.S. post-9/11 terrorist list.

In the late 1980s and early 1990s, Kerry fought to expose an international criminal bank, BCCI — the Bank of Credit and Commerce International. The bank was run by a Pakistani, working with Persian Gulf managers who operated through a network of secret offshore centers to hide their operations from the world’s bank examiners. They weren’t, however, hidden from the CIA, which not only knew what the bank was doing, but used the bank to funnel cash through its Islamabad and other Pakistani branches to CIA client Osama bin Laden, part of the $2 billion Washington sent to the Afghani mujahideen. The operation gave bin Laden an education in black finance. CIA director William Casey himself met with BCCI founder Agha Hasan Abedi. The CIA also paid its own agents through the bank and used BCCI to fund black ops all over the world.

Kerry took on not only the Bush clan and its friends, but the CIA, and members of Congress on both sides of the aisle. This is not irrelevant history, but important to examine, because it reveals a lot about Kerry and how he might respond to terrorism or other global criminal enterprises. Kerry’s record shows that he took on powerful political and bureaucratic interests, was a tenacious investigator, and savvy about international crime and money flows, which is crucial in the fight against terrorism.

Against the opposition of powerful Republicans and Democrats, and in light of a lack of cooperation from a very politicized Justice Department and stonewalling by the CIA, Kerry worked with investigators and ran Senate hearings that exposed the bank’s shadowy multi-billion-dollar scams and precipitated its end.

The Bank and the CIA

BCCI was founded in 1972 by Pakistani banker Agha Hasan Abedi and initially capitalized by Sheik Zayed of Abu Dhabi. It incorporated in the bank secrecy jurisdiction of Luxembourg but operated out of London. During two decades, it expanded to 73 countries worldwide, with nearly a million depositors with accounts totaling more than $10 billion. When the bank was finally shut down nearly 20 years later, between $9.5 and $15 billion — the analysts differ — had been lost or stolen, making this the biggest bank fraud in the world.

The bank had carved out a niche: it was the banker to the bad guys. One U.S. indictment would say that money laundering was BCCI's "corporate strategy." BCCI survived for two decades because it floated on the waves of the offshore system, with key booking operations in Luxembourg and the Cayman Islands, where bank regulators couldn’t go. Its Grand Cayman "bank-within-a-bank" was just a post office box. The bank also had friends in high places in the U.S. and, of course, the wink and nod of the CIA and the Reagan-Bush administration, which depended on its services. Over the years, BCCI was involved with:

• Drug cartels. As early as 1985, the U.S. Drug Enforcement Administration (DEA) and the IRS found that BCCI was involved in laundering heroin money, with numerous branches in Colombia to handle accounts for the drug cartels. It ran accounts for the traffickers’ protector, Panamanian dictator Manuel Noriega, as well as for the drug kingpins of Asia’s Golden Crescent, including Burmese heroin warlord Khun Sa, and for drug trafficking Afghanis and Pakistanis.
• Illegal arms traders. For the Afghanis, the rule was “drugs out, American and British arms in.” Clients also included Middle East terrorist Abu Nidal, who used bank financing to get weapons; the sellers of nuclear technology to Pakistan; and Syrian drug trafficker, terrorist, and arms trafficker Monzer Al-Kassar. The bank served international organized crime involved in extortion, bribery, kidnapping and murder, and ran accounts for Philippines dictator Ferdinand Marcos, Haiti's Jean-Claude Duvalier, Liberian strongman Samuel Doe and other thieving heads of state who needed to hide their stolen cash.

Lucy Komisar, a New York-based journalist, is writing a book on the offshore bank & corporate secrecy system and international money laundering.

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