The full name of BCCI is referring to the Bank of Credit and Commerce International. The in depth study of this BCCI--The World's Most Corrupt Bank, enable Banking and Finance students to have a more critical thinking on the reasons occurrence of this events. The happening of this event is then triggering the attention as well as interest of the Banking and Finance's major students to have a enhanced understanding of the truth story that happened behind, especially our group who carried out the discovery. As such, the students are then being immersed and exposed with every details of finding on this BCCI. This includes the history of BCCI, about the BCCI, the implications, the aftermath, as well as the conclusion.
Every chapter of the finding has brings us a significant well understanding on the what, when, where, why and how the event is happened. From here, we researched, we discovered, we learned, and we understand better about the BCCI. In short, the learning outcomes from the overall studies enable us to figure out the multiple of reasons for the happening as well as the lessons we shall learned from here. One of it will be the important role that should be play by a leader. From here, it is crucial for the senior management and key investors in establishing an honest, open and prudent bank culture to the public. Also, it is important for us to understand the need for powerful executives in an institutions to be well-controlled within a secure enterprise-wide corporate governance structure, especially when the interest of stakeholders like deposit holders are to be safeguarded. On top of that, the other importance of this study includes the danger that attempts to preserve confidence in a bank. Albeit BCCI was a well-intentioned, it ended up lead to further cover-ups inside and outside of the bank.
As a Banking and Finance student, it is crucial for us to realize more of the events relating to this industry. A good understanding on the past events that had happened shall teach us the lessons from not repeating it. Taking people's story into our lessons to be learned shall be the main purposes from this study!
An Overview of the Case:
A remarkable incident happened on Wednesday, July 29, 1992--the worst banking scandal in the twentieth century began from the BCCI corruption. It has been described as the largest bank fraud in the history!
The dramatic chapter of this affair began when regulators in seven countries attacked the branch offices of BCCI and finally they took control over the branches respectively. The monetary loss was a huge number of approximately $10 billion to $17 billion. Yet, the bank's liquidators, namely Deloitte and Touche have been recovered billions of dollars for the creditors. The scandal has been continues for nearly two decades of time. Unlike any others ordinary bank, the complexity of the bank structure and deal making were the reasons of its activities that was liquidated and still not fully understood after a decade of time. This is because BCCI was from its earliest days. It was made up with multiplying layers of entities, as well as it is related to one another through a chain of the holding companies, the affiliates subsidiaries, the banks-within-banks, the insider dealings, the nominee relationship and so on so forth.
Agha Hasan Abedi who was a Pakistani banker with Arab backing founded the BCCI in 1972 and was started in Luxembourg. The treasury and other key functions were then based in Cayman Islands as well as in London before it is decamping to Abu Dhabi in the year of 1990. A truly complex structure of holding companies, cross-holdings and nominee owners were held by its branches and subsidiaries over 70 countries. In its history of BBCI, there is no single regulator or even an audit team had full jurisdiction in avoidance of the bigger regulation due to its international nature. This is because the complexity of BCCI family of entities created by Abedi which evaded the ordinary legal restrictions with the breakage of corporate structure, keeping of record, review on regulatory as well as audits on the capital goods' flow as the daily practice and routine. Also, Abedi developed an ideal mechanism to facilitate illicit activity by others in order to create BCCI as a vehicle primarily without charge of government control. For instance, this includes the breaking of laws by officials of the BCCI.
Even though some others banks like CIA and the Bank of England reported had the facts of BCCI activities before the scandal happened, yet they were still unable to proved and take any early action against the BCCI. Inadequate communication among the agencies as well as the highly connection between government and BCCI's leaders cultivated has make the regulations difficult.
One of the brief fraud activities been carried out in the bank was the involvement in money laundering and the financing of arms trafficking. Many tainted funds were routed easily in the Cayman Islands by all offices around the world. BCCI had made a large loan to companies and individuals without a properly securing. This massive loans has make up the highly concentration of credit risk adding that it were not properly been documented or monitored. The bank was forced to absorb these huge loan losses when the massive loan borrowed went bad and the bank itself has no legal recourse on it. The bank's strategy in solving the problem is by taking in more new deposits and not to make any record on books immediately. This has directly created a matrix of false accounts that hid the losses for years. Apart from that, the other reason why BCCI had lost money was through its treasury department, in the early of 1980s. BCCI had reported lost of hundreds of millions of dollars through a financial services trading company that it set up. Paradoxically, BCCI's investigation and closure in 1991 was due to the gigantic amount of lost in the series of illegal US bank acquisitions as well as from the improperly secured loans that is underpinning them. On July 29, 1990, US customs Service completed an undercover operation and had arrested few BCCI figures who convicted of money laundering. And it is then followed by a fined of $ 14 million charged to the laundering after the bank itself pledged guilty on the illegal activity.
The BCCI's banks of illegal control, especially the several America financial institutions were exposed the losses that the bank has brought. The former US Secretary of Defense, Clark Clifford and his law partner, Robert Altman, were in charged to run the largest and first American that is based in Washington, DC, for about twelve years by these two high-profile Washington insiders. Both of them began to involve with BCCI in 1978. They assured the authorities that would be in charge of the purchased of an institution. Both had became the top executives of the Washington bank, was renamed First American Bankshares. Clifford and Altman maintained that they had pretended to be in good faith so that BCCI had not gained any effective control over the US bank. In 1993, the charged against Altman for the bank fraud failed because of his illness.
It happened in BCCI to be known as the largest financial shame of all time in the year of 1991. The 18-month-long series of articles were published in the Time magazines has describes the details of this international corruption. This include the investigation exposes in which the government utilized bank's services around the world to the financial terrorist organizations, hide drug money, as well as conduct illegal arms sales. A loss of $20 billion or more was being accounted during the shutdown of BCCI in 1991.
Outlaw Bank was then became the top nine business book of 1993 that is written by Jonathan Beaty [1] and S.C. Gwynne [2] , both are the Time magazine reporters after the incident of BCCI. This has earned them a slew of journalist award. The book stressed on how BCCI becomes the financial power house and how it fell apart. They offered a four-part rundown of BCCI, namely the financial establishment of choice of arms dealers, drug traffickers, intelligence operatives, terrorists, Third World strongmen, and so on. A Wild Ride Into the Secret Heart of BCCI (Random House) was then be the title in the book. Nevertheless, Beaty and Gwynne has done a terrific job in tackling the Leviathan that was BCCI. They presented to the reader in a apparent and coherent terms. With a keen eye for expertise an excellent story, they kept the interest of reader throughout by totaling a few of detective story flavor. In fact, it has always been dangerous for journalists by just exploring into this story like Beaty and Gwynne as well as public servants, where there are many deaths which associated with BCCI. Furthermore, Beaty and Gwynne had correctly understood and colorfully present the BCCI case in its true nature while most other studies of BCCI proverb it as a huge banking scandal. However, Beaty and Gwynne see it as the deepest and most detailed glimpse. Inside their findings, it has never been challenged or refuted, but has only grown to a more urgent with time.
The book had turned the tale into a fascinating read by crafting into own reporting quest into a thriller [3] . Both of the authors came out with a concise, with a third-person briefing on this bank's origin of Arab-owned, Pakistani-run and of course off-the-books are operating procedures. Also, the search guided them into the world of spies, arms dealers, and drug traffickers where BCCI thrived. In the book, both Beaty and Gwynne has done a fabulous job on tracing the truth origins of BCCI, specially the smooth-talking of Pakistan banker, Agha Hasan Abedi. Interestingly, The Outlaw Bank of the book leaves a deeply impression in which the offshore banking centers that was used by Abedi was to be so effectively still in business, another BCCI could happen. Inside, they as the investigative journalists, inspect of that related global institution and also the $20-billion-plus fraud that its agents committed. They inspected in 73 countries over a nearly 20-year period. The description on 'own ride' of the BCCI story was then started by them. The dramatic story includes a highly placed of the pseudonymous sources from the diverse of BCCI power brokers, among them was Clark Clifford. Followed by a second bursts back to outline the go up of BCCI in Pakistan. Based on the tale from both authors, they were to go on into the profound cover-up of BCCI crimes. In addition, they discovered the carelessness of "government all over the world."
The effects from this event are alarming. The U.S. intelligence agencies was then sheltered BCCI-"certainly" by William Casey's CIA and "probably" by the National Security Council. Nonetheless, the international banking rules remain unchanged.
In short, Beaty and Gwynne pointed out the government failure in everywhere in order to clamp down on BCCI despite the abundant evidence of its corruption. Both of them had make a very clear picture on the bank's capacity to suborn or use leader of the political community played. The prominent likes of Lord Callagham, Jimmy Carter, Clark Clifford, and Bert Lance are the few ranks of those tarnished.
BCCI was comprised of international financial crime on an enormous and a worldwide scale. The major criminal fraud by BCCI and its customers are relating to billions of dollars, whereby the money laundering happened in Europe, Africa, Asia, and also the Americans. The locations mentioned above were also involved in the bribery case, terrorism, arms trafficking, nuclear technologies selling, prostitution management, as well as the commission evasion and income tax facilitation. Plus, the activities of smuggling, illegal immigration, illicit purchases of banks and real estate, panoply of financial crimes and so on.
Apart from that, BCCI also involving in systematically bribed world wide leaders and political figures throughout the world during the years. BCCI rely wholely on these relationships, and of course, payments were to be made to these prominent political figures in more than 73 countries in which BCCI is operated. BCCI records and declarations from former BCCI officials with the related documents of BCCI's systematic securing of Central Bank deposits of Third World countries. The provision of BCCI towards these favors to the necessary political figures was a crucial. The dependence on those figures providing BCCI itself with favors, especially when it came into the time of need. This extraordinary relationship had brought BCCI to a systematically turned in using to generate cash needed as well as to maintain it on the book. The importance of figures in playing their role in agreed to give BCCI the lump sum of deposits from a country's Central Bank make it possible with this good relationship. As a result, a country's use of U.S. commodity credits were exclusively handling, same goes to special treatment on these way of processing of the money flowing in and out of a country smoothly, that is where the monetary controls were to be in place, and possess a right to own a bank, and many more. In return, BCCI pay bribes to the figure involved, or otherwise giving them other things that they wanted in a simple quid-pro-quo. Therefore, BCCI had an unusual relationship ranged from the questionable to the improper, as well to the fully fraudulent together with these officials from countries around the world. This includes the countries of Argentina, Bangladesh, Botswana, Brazil, Cameroon, China, Colombia, The Congo, Ghana, Guatemala, the Ivory Coast, India, Jamaica, Kuwait, Lebanon, Mauritius, Morocco, Nigeria, Pakistan, Panama, Peru, Saudi, Senegal, Sri Lanka, Sudan, Suriname, Tunisia, the United Arab Emirates, the United States, Zambia, and finally Zimbabwe.
BCCI also developed a strategy to penetrate the U.S. banking system and it is successfully implemented despite all the regulatory obstacles that had designed. It happened in 1977 through the secretly buying of U.S. banks at the same time opening branch offices of BCCI throughout the U.S. Eventually, merging of the institutions started. Even though BCCI faced difficulties in implement the strategy due to the massive regulatory barriers in the United States that is designed to insure accountability, yet BCCI still was be able to make it a success. Even though the entry of BCCI is delayed, it was still managed to acquire and operated four banks in seven states. This technique was then preferred by BCCI and was used in acquiring few banks in all over the Third World countries in Europe. From the method used, it included the purchasing of banks through nominees, having activities safeguarded by high-status lawyers, accountants, as well as the public relations firms, as well as politically-well connected agents. The essential technique has brought a significant success to BCCI from being blocked by the regulators to gain an interest in any of the U.S. banks.
BCCI required the collusion of nominees to misinform the regulators. The nominee in the case includes the heads of state of few foreign emirates, the key political as well as the intelligence figures from Middle East. Also, this includes the entities that were controlled by the most important bank and banker in the Middle East. Moreover, the insistently used of series of prominent Americans was also one of the successful secret acquisitions of the U.S. banks under the face regulatory suspicion. It began with Bert Lance and then followed by the former Defense Secretary, Clark Clifford, former U.S. Senator, Stuart Symington was once the well-connected former federal bank regulators and formal and current local, state and federal legislators. Purposely or not, the name that had just mentioned above was individuals that provided the necessary assistance to BCCI in lending their names and reputations to help BCCI in time of need, especially at critical moments. Therefore, this was not just purely the involvement of BCCI in the deception case that allowed infiltrating the United States as well as its banking system. In another words, BCCI used of political influence advocating and revolving door in Washington.
The integrity of unit mismanaged its investigation and examination of BCCI and also its relationships with the other government agencies that are concerning BCCI were to be discussed too. The federal prosecutors failed to identify the importance of information they received when handling the 188 drug money laundering. The information they were received concerning BCCI's other crimes, such as its apparent secret ownership of the First American. Thus, they was adequately failed to investigate all of these allegations by themselves. The Justice Department, U.S. Customs Service as well as Treasury Departments were unsuccessful to show any adequate support and assistance to the investigators and prosecutors while working on the case that is against BCCI in the year of 1988 and 1989. This is due to the conditions whereby an ultimately caused the chief undercover agent who was handled the sting against BCCI to exit Customs completely.
In 1990, the claim agreement between BCCI and the U.S. Attorney in Tampa kept BCCI alive and as a result it had an effect of discouraging BCCI's officials from telling the U.S. on what they knew about BCCI's larger criminality, like its ownership of First American and the following U.S. banks. The investigations stopped on BCCI in mid-1991. This happened when the Justice Department following the plea agreement until the press accounts, in which the action from Federal Reserve and the New York District Attorney in New York forces them into action. BCCI-related prosecutions and the key actions on any BCCI-related cases in Miami were broken down after the relations of Justice in Washington and the U.S. Attorney for Miami Dexter Lehtinen have been affected. Afterall, delayed of the months happened during the year 1991. The actively blocked and impeded Congressional attempts to examine BCCI in 1990 continue until Willian P. Barr became Attorney General in the late October, 1991. The practiced were carried out by the Justice Department personnel in few places, namely Washington, Miami, and Tampa. They were once blocked and impeded the attempts by New York District Attorney Robert Morgenthau in order to obtain the important information that is concerning BCCI in 1989, 1990 as well as 1991. It happened that one of the federal prosecutors lied to Morgenthau's office concerning the existence of such material. The incident failures of cooperation carry on took place until William P. Barr became Attorney General in the late October, 1991. Cooperation between Justice Department and the Federal Reserve was very limited until after the BCCI's global closure on July 5, 1991. The concerning of handling of any matters that is pertaining to BCCI was then cleverly crafted than true and was some of the public statements from the Justice Department.
Interestingly, the New York District Attorney Morgenthau broke the case of BCCI and indirectly brought to the BCCI's global closure. He began the investigation in 1989 on BCCI that is materially contributed to the chain of events and resulted in BCCI closure.
Price Waterhouse in England was the auditors that had the responsibility in answering the questions asked by District Attorney in order to deepen the review on BCCI's activities. He also gave life to a moribund Federal Reserve in examine the secret ownership of First American by BCCI. The District Attorney's criminal investigation was important in order to stop the intended reorganization of BCCI in working through an agreement among the Bank of England, the government of Abu Dhabi, BCCI auditors, Price Waterhouse as well as BCCI itself. The investigation was to discover the nature and extent of BCCI's criminality that would be hidden. Meanwhile, Abu Dhabi committed its financial resources in order to keep the bank going during a restructuring. However, there was a key barrier to a successful restructuring of BCCI in financed up Abu Dhabi, in which the possibility that the District Attorney of New York would accused occurred in the late spring of year 1991. The incident would unavoidably cause a swift and thoroughly justified an international run on the BCCI by depositors all over the world. However, this was considered as an extensive factor in the decision making of the Bank of England in taking the information that it had received from the Price Waterhouse and rely on it in order to close BCCI.
On top of that, we discovered that BCCI's accountants were failed to protect BCCI's innocent depositors and creditors as a result from the consequences of the poor practices at the bank in which the auditors were aware for years. This is because the decision in which BCCI to divide its operation between the two auditors, that is neither one of them has the right to audit all BCCI operations. It shown a significant mechanism whereby BCCI was be able to hide its fraud, especially during its early years. This continues for more than a decade and thus none of the BCCI's auditors objected to this practice.
In order to influence the independent judgment among the auditors that involved, BCCI provided them with loans and financial benefits. Only some of the auditors accepted these benefits and created an appearance of impropriety. The benefit is like the loans to the two Price Waterhouse partnerships in Caribbean. Besides, they were also accepted the payments and possibly the housing from BCCI as well as its affiliates by Price Waterhouse partners in the Grand Caymans. Also, they accepted the sexual favors provided by BCCI officials to a certain persons affiliated with the firm respectively. Regardless the attentions of BCCI to hide its fraud from the surface and external auditors, there were still numerous warming bells that are visible to the auditors from the very early years of bank's activities. Thus, the BCCI auditors have to do more to respond to them.
At the end of 1987, Price Waterhouse's knowledge in UK had given the about the inadequacies of BCCI's records. The too many reasons in identifying the not adequate basis for certifying had examined BCCI's books and records and it is a picture of those records that indeed a "true and fair view" of BCCI's financial state of affairs. Plus, BCCI auditors started the certifications from December 31, 1987 forward on its pictures of BCCI's books were "true and fair". This had caused the consequences of assisting BCCI to mislead their depositors, regulators, investigators, as well as the other financial institutions from exposed BCCI's true financial condition.
For instance, the incident that happened in 1990, where Price Waterhouse (UK) knew that gross irregularities in BCCI's handling of loans to CCAH/First American. It was told of the violation of U.S. banking laws by BCCI and yet its borrowers that were in connection with the CCAH/First American that is failed to advise the partners of its U.S. affiliate or any of the U.S. regulator. According to it, there is not prove that Price Waterhouse (UK) has to this day notified Price Waterhouse (US) about the extent of the problems founded at BCCI, or of BCCI's secret ownership of CCAH/First American. Because of the lack of information provided to the Price Waterhouse (US) by its United Kingdom affiliate, the U.S. firm performed its auditing of BCCI's U.S. branches in a way of professional and diligent, concerning BCCI's true activities in United States.
Moreover, in April, 1990, Price Waterhouse's certification of BCCI's books and records was explicitly conditioned by the Price Waterhouse (UK) on the proposition that Abu Dhabi would bail BCCI out of its financial losses. To avoid the bank from collapse, Bank of England, Abu Dhabi and BCCI worked with the auditors to restructure the bank. Even though Price Waterhouse did not make the certification for those assurances, and yet it still be able to receive its continued certification of BCCI's books from the Bank of England. Indeed, it is vital for the bank's survival.
The April 190 agreement as "true and fair" with a single footnote material to the massive losses still to be dealt with and it failed adequately to describe their nature to the public. As a result, the certification was materially misleading to anybody who relied on it regardless of the truth facts. Also, the decision of Abu Dhabi, Price Waterhouse (UK), BCCI and the Bank of England to distinguish BCCI over the period of 1990 and 1991, instead of to advice the public of what they knew. Therefore, the innocent depositors and customers of BCCI had a substantial injury who continued to do business with an institution.
Government of Abu Dhabi had knowledge of BCCI's criminality and frauds since from April, 1990 until November, 1990. It apparently withheld from BCCI's outside auditors, contributing to the delay in the ultimate closure of the bank and causing further injury to the bank's innocent depositors and customers.
In brief, CIA failed to provide the developed important information about BCCI to those who needed it. Even though, CIA and former CIA officials had a far wider range of contacts and links. CIA knew more about BCCI's goals and intentions relating to the U.S. banking system than others in government in the early 1985. The extra knowing cause the CIA provided such information to the U.S. Neither the treasury nor the Comptroller of Currency Office has the responsibility to regulate the First American bank that has been taken over by BCCI. The Federal Reserve and the Justice Department failed to receive the critical information gathered by the CIA. After knowing the truth that BCCI was actually an institution that fundamentally corrupt the criminal enterprise y CIA, they still continued to use both BCCI and First American for CIA operation's purposes. This shows an extensively involvement in money laundering and as a result the remarkable gaps in the CIA's reported knowledge on BCCI. Person who float in and out in BCCI at critical times in its history were the former CIA officials, former CIA director, namely Richard Helms and the late Willian Casey; former and current foreign intelligence officials, namely Kamal Adham and Abdul Raouf Khalil; as well as the principal foreign agents of U.S., namely Adnan Khashoggi and Manucher Ghorbanifar. Those people involved in the case also participated simultaneously in the key making episode in U.S foreign policy. This including from Camp David peace talks to the Iran arming as part of the Iran/Contra affair.
However, the termination information of the involvement of these people has been done by CIA and thus raising questions relating the quality of intelligence of the CIA as a whole. CIA's professions ignored about their respective roles in BCCI regarding the wide aspects of the bank's overall operations, structure, personnel, and history. This has made the case to be more complicated adding the mistakes made by CIA in the connection handling with BCCI.
CIA provided the untrue information in the beginning stage and incomplete information for the later stage; the Agency refused to provide the 'full' account about its knowledge on BCCI for almost a year after the initially information is requested.
Subsequently, regulator make a flawed decision in U.S., whereby they allowed BCCI to secretly acquired US banks as well as they manipulate the well-connected lawyers to aid them though out the whole process of acquiring. This happened when the Federal Reserve approved the takeover of Financial General Bankshares in 1981. It was suspected that BCCI was behind the bank's purchase. However, the Federal Reserve did not act on those evidence due to the specific representations made by CCAH's shareholders and lawyers. They stressed that BCCI was neither financing nor directing the takeover. Federal Reserve relied upon representations from several parties in approving the CCAH application. This includes the Central Intelligence Agency, State Department, as well as the other U.S. agencies who had no onjections about the Middle Eastern shareholders that declaring to buy the shares in the bank.
On the other hand, Federal Reserve is relied on the reputation of BCCI's integrity's lawyers, namely Clark Clifford, the former Secretary of Defense and Baldwin Tuttle, the former Federal Reserve counsel.
After the CCAH application was approved in 1981, Federal Reserve received several indicators about BCCI's possible improper participation in CCAH or First American. However, there were few obvious warnings signs during the purchasing of First American of National Bank of Georgia in 1986. The signs has to be investigated until the late 1990.
Apart from that, U.S. Treasury Department failed to provide Federal Reserve with information it received relating to BCCI's ownership of the First American in 1985 and 1986 from the CIA. During the investigation on BCCI, Federal Reserve's efforts were hampered, like the lack of cooperation by foreign governments. For instance, the significant Serious Fraud Office in United Kingdom.
Next, it was the failure of Bank of England's BCCI regulation that is inadequate to protect BCCI's depositors and creditors. Bank of England withheld information relating to BCCI's frauds from the public knowledge for about fifteen months before it's closed.
In the late 1970s, Bank of England had deep thoughts about BCCI. It undertook several steps in order to stop the development of BCCI in the United Kingdom. In 1988 and 1989, Bank of England learned the attachment of BCCI in financing of terrorism and in drug money laundering. As a result, it undertook an additional, yet limited administration of BCCI in response to receive the related information. Bank of England has been advised by Price Waterhouse on the substantial loan losses at BCCI, numerous poor practices as well as the fraud's evidence in the spring of 1990. This has created an oversize hole the book of BCCI lately.
To prevent the risk of its restructuring of BCCI, the Bank of England pending on the significant information from the Federal Reserve. That information included the size and scope of BCCI's lending on CCAH or First American shares. By doing so, the allowing of a full investigation by the Federal Reserve on Bank of England was lasted for about eight months.
In April 1990, Bank of England has agreed to permit BCCI to move its headquarters, officerd, and records to Abu Dhabi to avoid the jurisdiction of the negative consequences. This decision comprised of a costly and irretrievable as well as was an error to the part of Bank of England.
Besides, the participation of Clark Clifford and Robert Altman in the improprieties with BCCI that happened in United States was also crucial in the discussion. Both man participated in some deceptions in the United States started in the beginning of 1977.
Moreover, the next man involved is Abu Dhabi. His involvement in the BCCI's affairs was far more central than it has acknowledged. He involved in many cases nominee relations as well as no-risk transactions. However, he covered up through hiding witness and documents from U.S. investigators. In April 1990, a more than $500,000 of contribution to BCCI's capital was contributed by the members of Abu Dhabi's ruling family. Conversely, Abu Dhabi had tried to save BCCI through a immense reforming from April, 1990 until July 5, 1990. From here, Abu Dhabi, Price Waterhouse, Bank of England as well as BCCI has agreed to keep all related information that were concerning BCCI's frauds case and other illegal problems secretly from BCCI's one million of depositors and also from U.S. regulators and law enforcement as well.
Nevertheless, Sheikh Zayed had a political agenda in agreeing to engage in the members of the Abu Dhabi royal family and its investment authority by purchased shares of Financial General Bankshares, subsequently of CCAH or First American.
In addition, the widespread use of rotating door and political influence was manipulated by BCCI in the United States to achieve its goals. This can be seen under the political connections in Washington with BCCI, which subsequently brings an impact on its ability in order to achieve its goals in the United States. Also, BCCI used the strategy of hiring former government officials to accomplish the goals.
Subsequently, BCCI was then actively solicited the friendships with the major U.S. political figures. BCCI made a payment to these political figured to ask for their illegal assistant, which is wrong and improper. The political figures that has relation with BCCI were the former president, Jimmy Carter, Jese Jackson, as well as Andrew Young, the Subcommittee that has received information telling the BCCI network to be extended to other U.S. political figures.
Additionally, the investigation towards BCCI was remaining incomplete still as many transactions were not able to follow up. This is due to the withheld documents from U.S. investigators by British government and by the Abu Dhabi government. The non-disclosure of documents, such as documents relating BCCI's use to finance terrorism, to assist builders of Pakistan nuclear bomb, to finance Iranian arms deals and so on. As a result, many investigative still need to be remaining to be explored.
Below listed out the unanswered questions:
The relationship between BCCI and the Banco Nazionale del Lavoro;
The relationship between William Casey, the late CIA director with BCCI;
The extent of BCCI involvement in Pakistan's nuclear program;
Manipulation of commodities and securities markets by BCCI in Europe and Canada;
BCCI activities in India, like its relationship with Hinduja family, the business empire;
The relationship of BCCI with Sarkis Sarkenalian, the convicted Iraqi arms dealer;
The relationship of BCCI with Syrian and Monzer Al-Kassar, the drug traffickers;
The relationship with terrorists;
The relationship with other major arms dealers.
The Summary of Legislative Recommendations:
Recommendation from the Subcommittee in which the United States to develop an aggressive and coordinated approach to international financial crime. Also, to move further against foreign privacy and confidential laws in order to protect criminals.
Recommendation from Subcommittee to the Justice Department so that they reconsider the policies and practices that lead the ineffectiveness in the investigation. Also, they are to accuse BCCI and to impair their ability to cooperate with the other investigations that is conducted by the Federal Reserve, New York District Attorney as well as the Senate.
Recommendation from the Subcommittee that to upgrade the tracking of foreign financial institutions and activities by the central intelligence agency together with State Department. Also, they recommended on the dissemination of information relating to such institutions.
Recommendation from the Subcommittee to consider the congress on additional oversight mechanisms that is vital in order to ensure the CIA's account ability on such information provision.
Recommendation from the Subcommittee to the Federal agencies to impose a newly requirement on foreign auditors. This is to protect the U.S. interests in which any of the agencies that are rely on an audit certified by a certain foreign auditor.
Recommendation from the Subcommittee to the president and the secretary of state to advise the Abu Dhabi government.
Recommendation from the Subcommittee on the consideration of legislating a Federal statutory code to conduct for the Attorney, who practices before the Federal agencies.
The commodities futures trading commission to have a self-regulation on the commodities markets. So that the Chicago Board of Trade as well as the Chicago Mercantile Exchange that were inadequate can be protected the markets against money laundering involving the related trade from happening.
Recommendation from the Subcommittee is that to further adding steps in order to make sure the adequate accountability of foreign financial institutions to do business in the United States. This includes the foreign banks to form separately in capitalised holding.
Recommendation from the Subcommittee to suggest the buying of substantial shares by foreign investors to acquire them to appear personally in the United States. This is to ensure that the foreign investors are not acting as a nominee for someone else.
Recommendation from the Subcommittee to establish a committee of law enforcement officially. That is, the job is to conduct an oversight of prevention and also to respond to the failures of cooperation in the law enforcement.
Recommendation from the Subcommittee is to establish a statutory instrument for the receipt by assembly of foreign financial information.
