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1994-05-02
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<text>
<title>
'The Telegraph' Looks into BCCI Allegations
</title>
<article>
<hdr>
Joint Publications Research Service, August 21, 1991
Near East and South Asia: The Telegraph Looks into BCCI
Allegations
</hdr>
<body>
<p>By S. Srinivasan, principal correspondent of The Telegraph
[Delhi, All India Radio General Overseas Service in English,
1010 GMT, 13 Aug 91].
</p>
<p> Billed as the largest bank fraud in the world's financial
history, the affairs of the Bank for Credit and Commerce
International--BCCI--are getting curious. The allegations
run from the Bank having links with gun runners, drug dealers,
CIA operatives, and nuclear weapons component smugglers, to
name a few. The investigators all over the world are now coming
out with startling details on the $20 billion bank which was
founded by a Pakistan national, Agha Hasan Abedhi,in 1972 with
dreams of making it into the biggest bank of the world in 25
years. Abedhi himself is unable to say anything on his shattered
dream as he is fighting to recover from brain damage caused by
repeated heart attacks. The Karachi-based banker founded the
bank in Luxembourg with 47 branches, 24 in Britain and others in
12 countries. The BCCI Overseas has 63 branches in 28 countries
which include India. The bank has spread its tentacles from
Britain to the United States where it is said to have secret
stakes over several banks which were being run as its front
companies.
</p>
<p> The Indian operations of the BCCI has also kicked up a big
controversy. The three major allegations against the bank,
which has emerged in the Indian newspapers, are that the bank,
in collusion with the key officials and politicians, have
diverted tens of millions of dollars from India's economy into
its accounts; that the bank was used to fund purchase of arms
and terrorist operations, and the bank has misused American aid
money for funding Pakistani nuclear programs. The U.S. Senate
committee is investigating an allegation that the bank, in
collusion with top industrialists and officials, have diverted
illegally millions of dollars from India. The revelation was
made by private investigator Mr. Michael Hershman, of the
Fairfax fame. Mr. Hershman, who has worked with the Indian
Government, has said that he had collected as far as in 1986,
but did not pursue any more as the U.S. revenue officials did
not take any interest in the matter. The modus operandi,
according to him, was that the slush money was moved through
companies. The second allegation is over discovery of some
indiscriminating documents from the Bombay branch of the bank
which were antinationmal in character.
</p>
<p> Thirdly, doubts were expressed whether the funds were used to
promote Pakistan's clandestine nuclear program. The news reports
quoting the Wall Street Journal have alleged that a retired
Pakistani General Enamul Haq was arrested by German authorities
on July 11 the at Frankfurt Airport as he arrived with a phony
passport. According to the investigators, the general was
accused of evading American customs laws in shipping sensitive
and strategic materials. The report says that the documents in
the case show that these were financed by units of BCCI.
</p>
</body>
</article>
</text>