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The black network

In an escalation of its ongoing problems, BCCI has been labelled by TIME magazine in its latest issue as the world’s sleaziest bank. A chart depicts the structure of its activities in organised crime. Pakistanis have been skeptical about charges of drug money laundering, massive fraud etc, feeling that BCCI was being selectively ostracised when a whole field of western international banks were engaged in the same “accounting” shenanigans. However, one charge stands out as a complete shock, the allegations of the existence of the so-called BLACK NETWORK headquartered in Karachi. This clandestine division is supposed to be 1500-strong with a global intelligence operation and a Mafia-like enforcement squad. TIME magazine has further alleged use of sophisticated spy equipment and techniques along with bribery, extortion, kidnapping and murder etc and that BCCI has been involved in the lucrative arms trade business and the transportation of drugs and gold. Banking misdeamenours can be passed off as routine white collar crime, these fall within the realm of gross criminal activity bordering on terrorism and must be investigated forthwith. No civilization can survive without adhering to the laws governing civilized behaviour, to countenance such criminal activity or protect the perpetrators would tantamount to becoming collaborators or accessories to such crimes. No government on Earth can afford to be associated with such an entity, unless of course the Rubicon has been passed and the Government has become a slave to its dictates.

The Government of Pakistan (GOP) seems to have taken a very serious note of it and the Finance Minister, Mr. Sartaj Aziz has ordered an enquiry to be conducted by the State Bank of Pakistan and the Defence Services (presumably the ISI). The banking authorities of many countries have been clamouring that BCCI’s operations in Pakistan must be closed down, in solitary defiance of such requests the State Bank of Pakistan has kept BCCI going. This may be because of national pride in an institution that became an international success, real concern for protecting the savings of domestic depositors and the effect that it will have on our on-going export trade, a fair amount of which had been handled by BCCI, particularly the hand-knotted carpet exports. However, the present charges are so serious in nature that unless handled with the greatest care, the enemies of Pakistan will have a field day in defaming Pakistan as a nation in international circles. At the very least, Pakistan bankers have built up an enviable professional reputation internationally and unless we take steps for immediate damage-control, their present and future credibility will be irrecoverably undercut, GoP must decide immediately whether the country can afford to become a financial pariah internationally. It may be true that the interests of a few hundred thousand local depositors may be affected, ostracisation and isolation by forces that govern international banking will be economically disastrous for the whole population of Pakistan. Already living on a desperately thin edge, anything affecting the banking operations of our financial institutions will have a devastating effect on our economy. While we must certainly stand up and ensure that all patiently false accusations are effectively rebutted, as much as one may not like to believe otherwise, the bitter truth seems to point to definite evidence of wrongdoing by BCCI internationally. In the face of such wrongdoing, GOP must modify its protective stance. Any hint of an eyewash will have a counter-productive effect on us. Sources close to and within BCCI have described that report of BLACK NETWORK as sheer fantasy, it is, therefore, also in the interests of BCCI that an independent enquiry comes to the same conclusion. TIME magazine has alleged that a serious investigation against BCCI is hardly possible when a fair amount of our ruling elite, among them senior government officials, businessmen and politicians, stand to be exposed as they were using BCCI as a conduit for their ill-gotten gains, both for transfers and deposits. Reluctance on the part of our officials will only land credence to this theory and cast doubt on our intentions. To that end, some steps need to be taken post-haste, the first of which is what to do about BCCI operations within Pakistan. BCCI operations can be continued in a manner that does not affect our domestic depositors or ongoing export trade, the State Bank of Pakistan must immediately remove all senior BCCI officials from their posts and replace them by bankers from other financial institutions, pending the results of a complete investigation. It may be appropriate (and internationally circumspect) to associate some private renowned international investigation agency so that the results of the investigation becomes credible internationally. It is no use evading responsibility by falling back on the emotional aspects of nationalism, when there is a cancer in the country’s continued financial credibility, surgery for its removal may be a painful exercise but it has become necessary.

Drug money laundering is a fact of life in most international banks, in Pakistan BCCI branches are not the only ones involved, almost all the foreign banks turn a blind eye to this. The case of one-time Harvard graduate, Franklin Jurado, may be seen as an example. At this point he is languishing in a Luxembourg jail cell, accused of being the mastermind behind the laundering of the money drained from cocaine smuggling, belonging to the Cali cocaine chieftain Jose Santacruz Londono. Luxembourg’s lax tax and banking regulations may be easy to fool, Jurado did leave a US$ 70 million money trail through the banks in Belgium, Denmark, Germany, Sweden and the Netherlands, not saying much for the morals or practices of the conduit financial institutions which are involved in many many times more illegal transfers on a daily basis. As far as transfers from Pakistan are concerned, most funds must have directly gone to BCCI branches abroad, mostly through the Leadenhall Street Branch in London which was the Bank’s operational HQ. This is already under the control of the Bank of England (BoE) appointed liquidator Touche Ross, a routine audit should immediately establish the money transactions and trace out drug money laundering in Pakistan. The volume and the number of transactions should be of interest to our drug enforcement agencies clearly laying out the money trail to the masterminds of the entire illegal operation, giving GoP’s law enforcement agencies the necessary wherewithal to destroy the entire drug manufacturing and smuggling operation in Pakistan. This is a golden moment to launch a war without parameters against the whole drug conglomerate. At the same time, a full picture may emerge about the graft and corruption within this country. There may be quite a few surprises in this heaven sent opportunity to dig deep within BCCI’s files in Pakistan i.e. if the records have not been already shredded.

The breakdown of law and order in Pakistan brought about a reaction from the present Government in the form of the Twelfth Amendment. Charges that BCCI have been running a clandestine division involved in drug smuggling, gun running, kidnappings, murder etc cannot be discounted except by thorough enquiry by a Joint Intelligence Team consisting of the IB, ISI and MI. Money brings unlimited power, it is force-multiplied by official patronage. Money buys arms and hit men, over the years the process of Karachi’s destabilization has been accelerating because of proliferation of illegal arms. Doubts about similarities with the Medellin Syndrome should have been dispelled with the planned cold-blooded assassination of Judge Nabi Sher Junejo of the Anti-Terrorist Court. When judges are subject to intimidation of such murderous kind, a stage will come when the dispensal of justice will become a rarity. Saleem Malik, Director Customs Intelligence and a son-in-law of Pir Pagaro, has been similarly assassinated over the last weekend. One does not see the law enforcement agencies making any great headway when the investigators and judges are themselves becoming an endangered species.

Of greater concern is the shocking revelation that besides leaks to many western intelligence agencies, BCCI maintained links with Israel’s primary spy outfit, MOSSAD and terrorists organisations like that headed by Abu Nidal. While all intelligence agencies use banks as conduits for their transactions and BCCI can hardly be faulted for being so used by them, probity and propriety should have ensured that they had no links with MOSSAD or terrorists. Can we really be sure that they stopped with that and had no links with RAW? BCCI was associated with Indira Gandhi and helped in her re-election, those contacts resulted in the opening of their Bombay Branch. Almost as many Indians as Pakistanis were employees of the bank in UK and in other countries.

BCCI left Amjad Awan and other BCCI executives in limbo to serve sentences in jail in the Columbian drug money-laundering case, while accepting a hefty US$ 15 million fine for themselves. Awan’s testimony as a Prosecution witness against Noriega should be revealing, if he cooperates further and blows the whistle on the so-called BLACK NETWORK it would be a tremendous gift for this country. Amjad Awan was simply carrying out BCCI’s banking philosophy, abandoned as a hot potato he turned State’s evidence on a plea-bargaining deal. If BCCI were really not guilty, they could have used that US$ 15 million to pay for the legal defence of Awan and his associates.

The President of Pakistan being the Chief Patron of the BCCI Foundation, discretion requires that till such time the situation is clarified he disassociates himself from the working of this organisation, howsoever innocent and credible its charter and functions. Continued linkage may embroil the Head of State and his august office into an ambiguous controversy. Agha Hassan Abedi converted his dream into a real life scenario. Somewhere along the line, the invention seems to have turned into a Frankenstein monster, that is not unusual, neither is the fact that the inventor is usually the last to accept that his invention has become a monster. The unravelling of further evidence that BCCI had become a rogue bank is too regular a drumbeat to ignore any further, the cost may well be the integrity of this nation. In the first flush of the suspicion of BCCI’s operations, we are guilty of reacting emotionally to what was perceived to be a national issue, in the cold light of day we seemed to have been sold the Eiffel Tower by the Pakistani version of a modern-day Henry Wilson.

Instead of taking the Fifth Amendment about the Twelfth Amendment, BCCI is a good starting point to start enforcing the laws of the country in earnest.

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