THE KINGS OF MONEY LAUNDERING: THE RISE ANK FALL OF BCCI. AN EXTRAORDINARY STORY.

By Daniel González

The story that follows is real, and presents the financial suffering incurred by thousands of victims who were affected by the downfall of the bank. It is also a story of the sadness experienced by thousands of people who were involved in the bank’s development and then were touched by the hand of corruption, vice, wickedness, murder, blackmail, an

• Language: English
• Publisher: Independiente
• Release date: Dec 7, 2021

Daniel González

Panamanian banker. Mr. Gonzalez graduated from the University of Panama where he studied business administration. He began his banking career at Chase Manhattan Bank, followed by a position as assistant administrative manager at the Royal Bank of Canada. In 1979 he received an offer from BCCI to be deputy general manager, which he accepted. He resigned from BCCI in 1986. Mr. Gonzalez has given seminars on controlling money laundering at a variety of international conferences. He was a witness in the trial against the BCCI officers and members of the Medellín drug cartel who were arrested during Operation C-Chase. He also collaborated with the United States authorities in the trial against General Noriega in Miami.

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Prologue

There have been many stories throughout history about financial fraud that have led to a tremendous amount of losses and numerous bankruptcies. Perhaps the most scandalous of all, though, was the shocking collapse of the Bank of Credit and Commerce International, known in the banking world as BCCI. Probably because its history is more philosophical than commercial, or because it was such a young bank, I rose to a privileged position within the bank in a very short time, a bank which became one of the largest in the world. The famous phrase echoed among its executives was: The fastest growing bank in the world.

With a BCCI business card in hand, I became part of servicing a world clientele anxious to receive excellent service, personal attention, and the highest interest rates on their deposits and valuables. The clients’ assets were not only guarded by the bank directors, but they also believed they were receiving the blessing of God.

The story that follows is real, and presents the financial suffering incurred by thousands of victims who were affected by the downfall of the bank. It is also a story of the sadness experienced by thousands of people who were involved in the bank’s development and then were touched by the hand of corruption, vice, wickedness, murder, blackmail, and drugs; all in the name of the Most Holy God who was thought to be pouring out his blessings to endorse these financial monstrosities. 

Bon appetit!

Chapter I

The desert of Baluchistan is a hunting location preferred by the new rich of the Persian Gulf, where each year oil titans gathered to hunt and eat bustard, a delicious large game bird. With entourages that exceeded a hundred for every oil boss, their presence was impressive and the sands were filled with hunting parties.

The source of sexual power thought to emanate from this winged bird is the real reason it was hunted, and reason enough for these new rich to bring extravagance to the desert by setting up their white tents and unleashing free rein of exotic pleasures. This annual gathering presented an excellent opportunity for a man of great vision, and this man was Agha Hasan Abedi, a charismatic Islamic and former Pakistani banker who himself had suffered firsthand the nationalization of his home country’s banking system under President Bhutto's regime.

With a prominent forehead, gleaming eyes, a deep look, and boundless personality, this legendary Muslim Shia was raised under the influence of a fellow philanthropist and poet, who himself was characterized by projecting strong charisma and a mystical philosophy.

Abedi was determined to carry out his new venture and expressed his enthusiasm to several Sheiks, inviting them to become a part of his plan. He had carefully crafted and rehearsed the presentation of an idea presented to these opulent characters who had the money, but lacked the intelligence to fully understand the complexities of this enormous financial proposal.

The new bank that was forged in Abedi's mind was not only to act as a bridge between the Third and First Worlds, but would also be the largest bank in the entire world. His arguments were heard and accepted. The abstract ideas of its original conception began to materialize and a happy Abedi successfully convinced Dutchman Dick Van Onen, a representative in Bank of America’s Pakistan branch, to do business with him. Having a banking relationship with an American financial institution that headed the list of the ten largest banks in the world gave BCCI valuable international prestige along with a safe passport to the path of triumph.

Everything was ready, and on September 10, 1972 nearly one hundred people gathered around a rectangular table in the luxurious and very ornate ballroom of the five-star Hotel Phoenicia in Beirut. Despite the great interest shown by the Bank of America to expand its operations in the Middle East, and even though it was understood that the only way to achieve this was to channel investments through an Eastern bank, due to existing regulations its managers only deposited $725,000 of the $2,500,000 total initial capital raised for Abedi’s new bank.

Luxembourg's flexible laws, coupled with a suggestion from the Bank of America which already had a subsidiary there, gave Abedi the idea of also registering his bank in the same country. However, his egocentric character and luxurious and extravagant lifestyle forced him to open a subsidiary in London where he established BCCI’s headquarters and world operations center.

The Bank of Credit and Commerce International (Luxemburg), S.A. was the name given to the bank in Luxembourg, and the Bank of Credit and Commerce International, S.A. was the subsidiary in London.

Abedi was appointed Chairman of the Board of Directors for the new bank, while other board members included Mr. Swaleh Naqviwho, Chief Executive Officer, and Mr. Zafar Iqbal, Chief of Operations.

At the time BCCI was registered in Luxembourg, the initial 50,000 shares issued were distributed as follows:

The Emir of Abu Dhabi      10,000 shares

BCC Investment Holding Co.      1,000 shares

Stock Investment Holding, Co.      9,000 shares

Bank of America NT and S.A.      10,000 shares

Bank of America E. D Italy      2,500 shares

Geoffrey R. Edward Wallis      17,499 shares

Jacques Delveaux      1 share

Thirty five percent of the total shares was listed as owned by Edward Wallis, who was a close friend and legal counsel to Abedi.

In reality, however, some of those shares in Wallis’ hands belonged to others who wished to remain anonymous, and who had in effect given him proxy voting power over their shares. Thus, this arrangement gave Abedi sufficient power to control the new bank.

Wallis, a relatively unknown solicitor in the London borough of Bromley, by acting as the largest shareholder of the bank, meant that conditions were perfect for a rigged performance, and thus plenty of reason to think that from the very beginning BCCI was involved in the large financial fraud that was to come.

A race against time thus began with the ultimate goal of achieving, at any cost, the opening of offices in London, Luxembourg, Beirut, and the Persian Gulf before year end.

The small initial start-up capital of $2.5 million soon grew into the extraordinary sum of $113 million, giving rise to the famous phrase: The fastest-growing bank in the world. Further expansion of assets of which the bank counted as its own soon increased to $2.5 billion.

The deceitful tactics adopted by the bank managers had already permeated their conduct throughout all levels of BCCI’s administration, and each one of the officers received strict instructions to give efficient and personal treatment to each valued client. Accelerated growth was most important, no matter at what cost.

By that time offshore financial centers began to generate interest among the world’s top financiers, turning the Grand Cayman Islands into one of the largest banking financial paradises at that time.

A new, related company, the Bank of Credit and Commerce International (Overseas) Ltd., was established in the Cayman Islands which had the effect of dividing the bank into two entities: the first, (BCCI SA) started in Luxembourg, served as the operations base for Europe, Asia, Africa and the Middle East, and the latter, (BCCI Overseas) would extend its business networks across the entire world.

Mr. S.M. Shafi, a well-known banker having the strict confidence of Abedi, was in charge of starting up operations in the luxurious George Town offices located on the Island in the Guinness Mahon building. He also chaired the new bank’s board of directors.

From this tropical paradise the monetary conquest of the Americas began. Foreign currency, converted into American dollars, was the main part of this effort directed by business philosophers who, in the name of Almighty God, espoused their flattering words into the feverish minds of the new financial gods of the lower world.

Service was the word, and servitude the action. Under that idea a new type of administration philosophy was created and imposed by BCCI’s leader, Abedi, who as the institution’s central figure forced his own criteria on the new organization; the same criteria that fit his own personal beliefs.

In BCCI the mantra became that it is just as criminal to be mediocre as it is not to succeed! And success must be achieved at any cost, for someone who walks the world without leaving an indelible mark does not deserve to be called the Son of God. This was another of Abedi’s philosophies!

Following the bank's gigantic physical growth, human resources for its management also grew, thus necessitating the creation of a banking school that opened, Abedi-style, in Karachi, Pakistan, and whose attendees were mostly Pakistani.

The many topics taught in this banking school included, of course, finance, business affairs, international law, human relations, and marketing. But above all, the philosophy of Islam was paramount and held them together spiritually, as a cohesive unit. Led by their master, the participants were trained and perfected, day by day, until reaching a level of education which would guarantee their resounding success when they went forth to face the outside world.

Graduation for the attendees was held every six months and the guest of honor was, of course, Abedi, whose inspirational speech was always the most important part for those assembled.

Today, this graduation is one more challenge in your lives, and it is God who will enlighten the path you must take, and guided by Him, He will take you by the hand to the end of your destiny where you will be triumphant.

Beautiful words of a great gentleman who was touched by the moment and convinced of his own philosophy; he did not hesitate for a second to impose it on those around him.

The essence of his divine nature shocked all those present, and there was no shortage of flattering words from a number of students who greatly praised him, thereby inflating his ego to the highest peaks.

After the pompous festivities were over, the graduates began their pilgrimage to the ultimate goal, the common goal, instituted by their leader on all persons who would wear or carry the BCCI label. Their shared spirit was founded with their own blood and influenced by the man with the iron will for whom truth and falsehood, charity and influence peddling, were almost always two sides of the same coin.

These upper-level executives of the new bank could not drink liquor, and visits to nightclubs were totally forbidden, as well as weddings performed outside Islamic law.

It was both the power exerted on the executives and the ability to seduce and hypnotize them that, one day at a conference held at a hotel in Lahore, Abedi held a completely blank piece of paper in his left hand before the audience, and while pointing his right index finger at it said: Watch the spot on this paper as it shrinks and then grows bigger!

His audience stared in amazement, paralyzed by the phenomenon already envisioned in each of their minds, and entirely dominated by him.

All the mysticism that surrounded Abedi made him more honored by his subordinates, even more so when, under his direction, rooms exclusively devoted to prayer were built. These rooms were true temples of prayer where each of the faithful prayed quietly in private, praising God without outside interruption from anyone who would disturb the supreme peace within that sacred enclosure.

Another dark side of Abedi, unknown to most worshippers, consisted of requesting sexual favors from certain clients for the benefit of others. One of the most famous was a wealthy businessman who maintained a school for teenagers located in the Lahore district of Pakistan. At that school, girls from the age of twelve were trained to entertain VIPs for a variety of special occasions, as well as be available for meetings and conventions held by top government officials. The girls would also act as private companions of millionaire clients who could afford to pay for their services.

BCCI, under the direction of Abedi, provided