Spitfire List Web site and blog of anti-fascist researcher and radio personality Dave Emory.

For The Record  

FTR #589 Interview with Lucy Komisar About the BCCI

Record­ed March 11, 2007
MP3 Side 1 | Side 2

Intro­duc­tion: High­light­ing infor­ma­tion about the Bank of Cred­it and Com­merce Inter­na­tion­al (“BCCI”), this inter­view sets forth inves­tiga­tive jour­nal­ist Lucy Komisar’s chap­ter on the bank in a new book “A Game as Old as Empire.” A major vehi­cle for covert oper­a­tions in the 1970’s, and 1980’s, the insti­tu­tion was known to insid­ers as “The Bank of Crooks and Crim­i­nals Inter­na­tion­al.” With strong con­nec­tions to both the elder and younger George Bush, the Sau­di elite, Sad­dam Hus­sein, the Iran­ian mul­lahs, the Iran-Con­tra scan­dal, drug traf­fick­ing, ter­ror­ism and the milieu of Osama bin Laden and al-Qae­da, the bank’s clos­ets held many skele­tons. This broad­cast details some of those skele­tons, and reviews key aspects of the cov­er-up. Be sure to vis­it Lucy’s web­site, where the book can be ordered at a dis­count. In addi­tion to the pro­grams not­ed below, be sure to lis­ten to check out Dave’s oth­er inter­views with Lucy, such as FTR#’s 463, 485, 531.

Pro­gram High­lights Include: The BCCI’s links through Sau­di intel­li­gence to the elder George Bush; the BCCI’s links through its investors to the cap­i­tal­iza­tion of the younger George Bush’s ener­gy ven­tures; the cov­er-up of the BCCI inves­ti­ga­tion by the admin­is­tra­tion of Bush the Elder; the dis­ap­pear­ance of the mon­ey that was stolen; the role of the BCCI in the arm­ing of Iran as part of the Iran-Con­tra scan­dal; the BCCI’s role in the arm­ing of Sad­dam Hus­sein; the role of the BCCI in arm­ing the Afghan muja­hedeen; the role of the BCCI and its investors in financ­ing the activ­i­ties of Osama bin Laden, both dur­ing the war against the Sovi­ets in Afghanistan and sub­se­quent­ly; the role of the Clearstream net­work in the BCCI affair; the role of FBI direc­tor Robert Mueller in cov­er­ing up the BCCI case.

1. Financed by wealthy investors from Pak­istan and the Per­sian Gulf (most­ly Sau­di Ara­bia), the BCCI served as a major vehi­cle for U.S. covert oper­a­tions around the world, the Mid­dle East in par­tic­u­lar. Even­tu­al­ly, the institution’s role in financ­ing illic­it weapons deals, drug traf­fick­ing oper­a­tions and inter­na­tion­al ter­ror­ism led to an inves­ti­ga­tion. New York D.A. Robert Mor­gen­thau returned indict­ments. The admin­is­tra­tion of George W. Bush was less than vig­or­ous in its pur­suit of the case, per­haps due to the fact that the BCCI and its major play­ers were very, very close to both the elder and the younger George Bush. The monies that van­ished have nev­er been locat­ed. The Bank of Cred­it and Com­merce Inter­na­tion­al was found­ed in 1972 by a Pak­istani banker, Agha Hasan Abe­di, with the sup­port of Sheik Zayed bin Sul­tan al Nahyan, the ruler of the oil-rich state of Abu Dhabi and head of the Unit­ed Arab Emi­rates. The Arabs’ inter­est in the bank was more than finan­cial. A clas­si­fied CIA memo on BCCI in the mid-80s said that ‘its prin­ci­pal share­hold­ers are among the pow­er elite of the Mid­dle East, includ­ing the rulers of Dubai and the Unit­ed Arab Emi­rates, and sev­er­al influ­en­tial Sau­di Ara­bi­ans. They are less inter­est­ed in prof­itabil­i­ty than in pro­mot­ing the Mus­lim cause.’ BCCI enriched the entourage of the Bush­es and oth­er Wash­ing­ton influ­en­tials. Its biggest share­hold­ers were Sau­di and Unit­ed Arab Emi­rates sheiks. The mon­ey it stole—somewhere between $9.5 bil­lion and $15 billion—made its 20-year heist the biggest bank fraud in his­to­ry. Most of it was nev­er recov­ered. The George H.W. Bush admin­is­tra­tion, in pow­er when the mega-fraud was dis­cov­ered, went after the bank half-heart­ed­ly and only after indict­ments by New York Dis­trict Attor­ney Robert Mor­gen­thau. It nev­er touched the Per­sian Gulf mon­ey-men who ran the BCCI crim­i­nal enter­prise. The Bush fam­i­ly and its allies used and then pro­tect­ed the world’s most crim­i­nal bank.”
(A Game as Old as Empire; edit­ed by Stephen Hiatt with an intro­duc­tion by Jonathan Perkins; Berrett-Kohler; Copy­right 2007, Berrett-Koehler; Excerpts are from Chap­ter Four by Lucy Komis­ar.)

2. Bush fam­i­ly ally bin Mah­fouz nev­er went to jail as a result of his wrong­do­ing in the BCCI affair. “As a result of Morgenthau’s inves­ti­ga­tion, in July 1992 a New York grand jury indict­ed [Sau­di busi­ness­man and head of the Nation­al Com­mer­cial Bank] Khalid bin Mah­fouz and an aide for defraud­ing BCCI and its depos­i­tors of as much as $300 mil­lion, using depos­i­tors’ mon­ey to buy his bank shares. The U.S. Fed­er­al Reserve alleged that he breached bank­ing reg­u­la­tions. But bin Mah­fouz alleged that he could not be touched by Amer­i­can crim­i­nal law in Sau­di Ara­bia, and Mor­gen­thau dropped the charges in 1993 after bin Mah­fouz agreed to set­tle for $225 mil­lion. He and the Nation­al Com­mer­cial Bank also made a $253 mil­lion deal with BCCI’s cred­i­tors to resolve their claims. Kamal Adham, the for­mer Sau­di intel­li­gence chief, agreed to pay a $105 mil­lion fine. The fines in the end toped $1.5 bil­lion, a frac­tion of the amount that had dis­ap­peared, and nobody went to jail. The Jus­tice Depart­ment didn’t go after Bush fam­i­ly friend and mon­ey source bin Mah­fouz at all.” (Idem.)

3. The elder George Bush’s tenure as direc­tors of the CIA brought him into con­tact with many of the key play­ers in the BCCI. Many BCCI play­ers, includ­ing Osama bin Laden’s broth­er, helped the younger Bush to get his ener­gy ven­tures off the ground. “Sheik Kamal Adham, broth­er-in-law of the late Sau­di King Faisal, head of Sau­di intel­li­gence from 1963 to 1979, and the CIA’s liai­son in the area, became one of BCCI’s largest share­hold­ers. George Bush Sr. knew Adham from his time run­ning the CIA in 1975. Anoth­er investor was Prince Tur­ki bin Faisal al-Saud, who suc­ceed­ed Adham as Sau­di intel­li­gence chief. The Bush­es’ links to the bank passed through Texas busi­ness­man James R. Bath to bin Mah­fouz. Bath invest­ed mon­ey in the Unit­ed States on behalf of bin Mah­fouz and with a third part­ner, Ghaith Pharaon (a Sau­di Har­vard MBA), shared own­er­ship of Houston’s Main Bank. In 1976, when Bush was the head of the CIA, the agency sold some of the planes of Air Amer­i­ca, a secret ‘pro­pri­etary’ it used dur­ing the Viet­nam War, to Sky­way, a com­pa­ny owned by Bath and bin Mah­fouz. Bath then helped finance George W. Bush’s oil com­pa­ny, Arbus­to Ener­gy Inc., in 1979 and 1980.” (Idem.)

4. George W. Bush’s ener­gy ven­tures con­tin­ued to pros­per as a result of the back­ing of BCCI investors. “When Harken Ener­gy Corp., which had absorbed Arbus­to (by then merged with Spec­trum 7 Ener­gy), got into finan­cial trou­ble in 1987, Stephens helped it secure $25 mil­lion financ­ing from the Union Bank of Switzer­land (UBS). As part of that deal, a place on the board, was giv­en to Harken share­hold­er Sheik Abdul­lah Taha Bakhsh, whose chief banker was BCCI share­hold­er bin Mah­fouz. Then, in 1988, George Bush Sr. was elect­ed pres­i­dent. Harken ben­e­fit­ed by get­ting some new investors, includ­ing Salem bin Laden, Osama bin Laden’s broth­er, and Khalid bin Mah­fouz. Osama bin Laden him­self was busy else­where at the time—organizing al-Qae­da.” (Idem.)

5. Dur­ing the first Afghan War (against the for­mer Sovi­et Union), the BCCI was used to fund the Afghan Muja­hed­din. In order to do so, the bank worked with the Bank al-Taqwa, which was used to finance al-Qaeda’s activ­i­ties. (For more about Bank al-Taqwa, see—among oth­er programs—FTR#’s 343, 454, 455, 456, 462, 464, 467, 513, 537.) “The CIA used Islam­abad and oth­er BCCI branch­es in Pak­istan to fun­nel some of the $2 bil­lion that Wash­ing­ton sent to Osama bin Laden’s Muja­hed­din to help fight the Sovi­ets in Afghanistan. It moved the cash the Pak­istani mil­i­tary and gov­ern­ment offi­cials skimmed from U.S. aid to the Muja­hed­din. It also moved mon­ey as required by the Sau­di intel­li­gence ser­vices. The CIA mon­ey passed from the U.S. to the al-Taqwa Bank in Nas­sau to Bar­ba­dos to Karachi to BCCI in Islam­abad. Al-Taqwa—the name means ‘fear of God’—was not a real bank with bricks and mor­tar and depos­i­tors and ser­vices. It was a shell bank set up to finance the jihad. The BCCI oper­a­tion gave Osama bin Laden an edu­ca­tion in off­shore black finance that he would put to use when he orga­nized the jihad against Amer­i­ca. And the CIA was well aware of its student’s capa­bil­i­ties. After 9/11, U.S. agents head­ed straight for al-Taqwa’s oper­a­tions in Switzer­land, Liecht­en­stein and Nas­sau and shut them down. Swiss police ques­tioned al-Taqwa’s pres­i­dent, Youssef Mustafa Nada, who was part of the Egypt­ian Mus­lim Broth­er­hood, a rad­i­cal Islamist orga­ni­za­tion, and they searched his home in Cam­pi­one d’Italia, an Ital­ian tax haven on Lake Lugano.” (Idem.)

6. Dur­ing the Iran-Iraq War, the BCCI helped to finance the Reagan/Bush admin­is­tra­tions’ arm­ing of Sad­dam Hus­sein. “BCCI also helped Sad­dam Hus­sein, again with the com­plic­i­ty of his Wash­ing­ton friends. The bank fun­neled mil­lions of dol­lars to the Atlanta branch of the Ital­ian government–owned Ban­ca Nazionale del Lavoro, which was Baghdad’s Amer­i­can banker, so that from 1985 to 1989 it could make $4 bil­lion in secret loans to Iraq to help it buy arms. Con­gress­man Hen­ry Gon­za­lez held a hear­ing on BNL in 1992 dur­ing which he quot­ed from a con­fi­den­tial CIA doc­u­ment that said the agency had long been aware that the bank’s head­quar­ters was involved in the Amer­i­can branch’s Iraqi loans. Kick­backs from 15 per­cent com­mis­sions on BNL-spon­sored loans were chan­neled into bank accounts held for Iraqi lead­ers via BCCI offices in the Cay­mans as well as in off­shore Lux­em­bourg and Switzer­land. BNL was a client of Kissinger Asso­ciates, and Hen­ry Kissinger was on the bank’s inter­na­tion­al advi­so­ry board, along with Brent Scow­croft, who would become George Bush Sr.’s nation­al secu­ri­ty advi­sor. That con­nec­tion makes Bush admin­is­tra­tion offi­cials’ indig­na­tion at the Iraq’s ‘oil for food’ pay­offs rather disin­gen­u­ous. Bush and his friends of course knew that Sad­dam was mak­ing pay­offs on their watch: their favorite crim­i­nal bank was mov­ing the mon­ey! And in anoth­er pre‑9/11 inci­dent of blow­back, the weapons bought by Sad­dam with BNL funds were used dur­ing the Gulf War against Amer­i­cans and their allies.” (Idem.)

7. In addi­tion to arm­ing Sad­dam Hus­sein, the BCCI was also involved in arm­ing Iraq’s erst­while ene­my Iran, through the machi­na­tions of the Iran-Con­tra scan­dal. Lucy reviews Oliv­er North’s use of the bank for many of the Iran/Contra deals. “Not con­tent with aid­ing Sad­dam Hus­sein, the Rea­gan­ites decid­ed to arm Iran as well. A Pak­istani arms deal­er, Arif Dur­rani, said that dur­ing the Rea­gan and Bush admin­is­tra­tions the CIA used BCCI to finance ship­ments of Hawk mis­siles to Iran to pro­mote stale­mate in the Iran-Iraq War. BCCI’s largest bor­row­er was the Gulf Group, the fam­i­ly com­pa­ny of Mustapha Gokal, finan­cial advi­sor to rad­i­cal Islamist Aya­tol­lah Khome­i­ni. BCCI gave the Gulf Group unse­cured loans of $800 million—more than two-thirds its total capital—and the Gokal com­pa­ny pro­vid­ed Iran with war mate­r­i­al, food and drugs.” (Idem.)

8. Depos­i­tors have nev­er been reim­bursed. The major investors, such as bin Mah­fouz, are doing quite well, how­ev­er. “What hap­pened to the bil­lions of dol­lars sucked out of BCCI and nev­er repaid to depos­i­tors? Inter­na­tion­al banks’ com­plic­i­ty in the off­shore secre­cy sys­tem has effec­tive­ly cov­ered up the mon­ey trail. But in the years after the col­lapse of BCCI, Khalid bin Mah­fouz was still flush with cash, and the for­mer financier of George W. Bush became a financier of Osama bin Laden. In 1992, bin Mah­fouz had estab­lished the Muwafaq (“blessed relief”) foun­da­tion in the off­shore Chan­nel Islands, pro­vid­ing it with as much as $30 mil­lion. The U.S. Trea­sury Depart­ment called it ‘an Al-Qae­da front that receives fund­ing from wealthy Sau­di busi­ness­men.’” (Idem.)

9. More about the prox­im­i­ty of bin Mahfouz’s Nation­al Com­mer­cial Bank to the milieu of the bin Laden fam­i­ly: “His $21 bil­lion Nation­al Com­mer­cial Bank was the world’s largest pri­vate bank. NCB was affil­i­at­ed with Inter-Mar­itime Man­age­ment SA, a sub­sidiary of the Bank of New York-Inter Mar­itime Bank in Gene­va. By coin­ci­dence [!], anoth­er Inter-Mar­itime sub­sidiary, Unimags Trad­ing, had shared a Gene­va address with SICO, the Sau­di Invest­ment Com­pa­ny run by Yeslam Bin­laden. SICO is the hold­ing com­pa­ny of the Sau­di Bin­laden Group (SBG), the largest Mid­dle East con­struc­tion com­pa­ny, which oper­ates through a web of off­shore com­pa­nies and is owned by the extend­ed bin Laden fam­i­ly. Yeslam is the half-broth­er of Osama bin Laden.” (Idem.)

10. BCCI play­er bin Mahfouz’s Nation­al Com­mer­cial Bank was deeply involved with the DMI, which in turn, is pro­found­ly con­nect­ed to the milieu of Osama bin Laden and oth­ers of his fam­i­ly. “In 1998, the U.S. com­plained to Sau­di Ara­bia that the Nation­al Com­mer­cial Bank was fund­ing Osama bin Laden’s activ­i­ties in Afghanistan and Chech­nya, and the Abu Sayyaf gueril­las in the Philip­pines. Bin Mah­fouz was a board mem­ber of the Dar al-Mal al-Isla­mi (DMI), the House of Finance of Islam, a Gene­va-based bank charged with dis­trib­ut­ing sub­si­dies of the roy­al fam­i­ly in the Mus­lim world. DMI, found­ed in 1981 and with assets of an esti­mat­ed $3.5 bil­lion, also had con­nec­tions to the bin Laden fam­i­ly: its 12-mem­ber board of direc­tors includ­ed Hay­dar Mohamed bin Laden, Osama bin Laden’s half-broth­er. The con­nec­tions are inter­est­ing. The bank’s pres­i­dent, Mohammed al-Faisal, was also an investor and board mem­ber of al-Shamal Bank, which held al-Qae­da mem­bers’ accounts. In tes­ti­mo­ny dur­ing U.S. tri­als of sus­pects in the 1998 attacks on Amer­i­can embassies in Kenya and Tan­za­nia, an al-Qae­da col­lab­o­ra­tor Essam al-Ridi, recount­ed how bin Laden trans­ferred $230,000 from al-Shamal Bank to a bank in Ari­zona to buy a plane to fly Stinger mis­siles from Pak­istan to Sudan. Com­ing full cir­cle, al-Faisal’s DMI was a major share­hold­er of al-Taqwa. In 1999, U.S. inves­ti­ga­tors look­ing into the attacks on the U.S. embassies in Africa, found sus­pi­cious trans­fers of tens of mil­lions of dol­lars from NCB to ‘char­i­ties’ believed to fun­nel mon­ey to Osama bin Laden. Some of the ‘char­i­ties’ believed to fun­nel mon­ey to Osama bin Laden. Some of the ‘char­i­ties’ believed to fun­nel mon­ey to Osama bin Laden. Some of the ‘char­i­ties’ were run by the bin Mah­fouz fam­i­ly the Saud­is ordered an audit and con­firmed the trans­fers. Alto­geth­er, $2 bil­lion was miss­ing from the Nation­al Com­mer­cial Bank. The Saud­is put bin Mah­fouz under house arrest and forced to sell his shares. . . .But the mon­ey he ran still flowed to bin Laden.” (Idem.)

11. Next, Lucy and Dave review the links between the Clearstream net­work and BCCI. (For more about this, see—among oth­er programs—FTR#’s 356, 387, 458.)

12. The tepid, reluc­tant inves­ti­ga­tion into BCCI that was described in para­graph #1 was over­seen by Robert Mueller, now head of the FBI. When Mueller was appoint­ed, Mr. Emory not­ed that his inves­ti­ga­tion of BCCI was less than vig­or­ous and not­ed as well that many of the play­ers in the BCCI scan­dal also fig­ured in the inves­ti­ga­tion into al-Qae­da. In FTR#310, Mr. Emory spec­u­lat­ed that the prox­im­i­ty of the elder and younger George Bush, as well as Osama bin Laden to the milieu of the BCCI might well have dic­tat­ed Mueller’s appoint­ment to be head of the FBI, as he could re relied on to “let sleep­ing dogs lie.”


One comment for “FTR #589 Interview with Lucy Komisar About the BCCI”

  1. NJ Gov Thomas Kean did a land deal through BMI to some Sau­di man in the 1980s, right around the time BCCI deals were going down.

    Giv­en BMI was lat­er tied to 911 this would seem unfor­tu­nate, were it not for Kean get­ting a plum posi­tion as a 911 inves­ti­ga­tor.

    I have a hunch some­one should ask Kean about BCCI. And was­n’t he a part­ner with Khalid bin Mafouz in Amer­a­da Hess Delta Oil in the 1990s?

    An exam­ple of a BMI type deal is here http://www.apnewsarchive.com/1991/Scandal-ridden-BCCI-Reportedly-Linked-To-Atlantic-City-Real-Estate-Deal/id-80e110daee77a53c46898443b93d30cc

    It shows that orga­nized crime, like the DeCav­al­cantes, were involved in BCCI.

    Here’s some news for you. Soli­man Biheiri ran BMI. HIs fam­i­ly lived next door to Phil Guri­an’s fam­i­ly on a cul-de-sac in Plan­ta­tion, Flori­da, for I don’t know how long in the 1990s.

    Phil Guri­an has absolute­ly no ties to the DeCav­al­cantes, of course.

    Posted by adam | May 2, 2016, 1:55 pm

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