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FINANCE: Questions Linger About Bushes and BCCI
Analysis by Lucy Komisar*
NEW YORK, Apr 4 (IPS) - Now that the U.S. Congress is investigating the
truth of President George W. Bush's statements about the Iraq war, they
might look into one of his most startling assertions: that there was a
link between Saddam Hussein and Osama bin Laden.
Critics dismissed that as an invention. They were wrong. There was a link,
but not the one Bush was selling. The link between Hussein and Bin Laden
was their banker, BCCI. But the link went beyond the dictator and the
jihadist - it passed through Saudi Arabia and stretched all the way to
George W. Bush and his father.
BCCI was the Bank of Credit and Commerce International, a dirty offshore
bank that then-president Ronald Reagan's Central Intelligence Agency used
to run guns to Hussein, finance Osama bin Laden, move money in the illegal
Iran-Contra operation and carry out other "agency" black ops. The Bushes
also benefited privately; one of the bank's largest Saudi investors helped
bail out George W. Bush's troubled oil investments.
BCCI was founded in 1972 by a Pakistani banker, Agha Hasan Abedi, with the
support of Sheik Zayed bin Sultan al Nahyan, ruler of Abu Dhabi and head
of the United Arab Emirates. Its corporate strategy was money laundering.
It became the banker for drug and arms traffickers, corrupt officials,
financial fraudsters, dictators and terrorists.
The CIA used BCCI Islamabad and other branches in Pakistan to funnel some
of the two billion dollars that Washington sent to Osama bin Laden's
Mujahadeen to help fight the Soviets in Afghanistan. It moved the cash the
Pakistani military and government officials skimmed from U.S. aid to the
Mujahadeen. It also moved money as required by the Saudi intelligence
services.
The BCCI operation gave Osama bin Laden an education in offshore black
finance that he would put to use when he organised the jihad against the
United States. He would move money through the Al-Taqwa Bank, operating in
offshore Nassau and Switzerland with two Osama siblings as shareholders.
At the same time, BCCI helped Saddam Hussein, funneling millions of
dollars to the Atlanta branch of the Italian government-owned Banca
Nazionale del Lavoro (BNL), Baghdad's U.S. banker, so that from 1985 to
1989 it could make four billion dollars in secret loans to Iraq to help it
buy arms.
U.S. 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 U.S. 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 the
Bush administration's surprise and indignation at "oil for food" payoffs
in Iraq seem disingenuous.
Important Saudis were influential in the bank. 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 family of Khalid Salem bin Mahfouz, owner
of the National Commercial Bank, the largest bank in Saudi Arabia, banker
to King Fahd and other members of the ruling family, bought 20 to 30
percent of the stock for nearly one billion dollars. Bin Mahfouz was put
on the board of directors.
The Arabs' interest in the bank was more than financial. A classified CIA
memo on BCCI in the mid-1980s 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."
The Bushes' private links to the bank passed to Bin Mahfouz through Texas
businessman James R. Bath, who invested money in the United States on
behalf of the Saudi. In 1976, when Bush was the head of the CIA,
the agency sold some of the planes of Air America, a secret "proprietary"
airline 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.
When Harken Energy Corp., which had absorbed Arbusto (by then merged with
Spectrum 7 Energy), got into financial trouble in 1987, Jackson Stephens
of the powerful, politically-connected Arkansas investment firm helped it
secure 25 million dollars in financing from the Union Bank of Switzerland.
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
half-brother, and Khalid bin Mahfouz. Osama bin Laden himself was busy elsewhere
at the time - organising al Qaeda.
The money BCCI stole before it was shut down in 1991 - somewhere between
9.5 billion and 15 billion dollars - made its 20-year heist the biggest
bank fraud in history. Most of it was never recovered. International
banks' complicity in the offshore secrecy system effectively covered up
the money trail.
But in the years after the collapse of BCCI, Khalid bin Mahfouz was still
flush with cash. In 1992, he established the Muwafaq ("blessed relief")
Foundation in the offshore Channel Islands. The U.S. Treasury Department
called it "an al Qaeda front that receives funding from wealthy Saudi
businessmen."
When the BCCI scandal began to break in the late 1980s, the Sr. Bush
administration did what it could to sit on it. The Justice Department went
after the culprits - was virtually forced to - only after New York
District Attorney Robert Morgenthau did. But evidence about BCCI's broader
links exist in numerous U.S. and international investigations. Now could
be a good time to take another look at the BCCI-Osama-Saddam-Saudi-Bush
connection.
*Investigative journalist Lucy Komisar's chapter, "The BCCI Game: Banking
on America, Banking on Jihad," appears in the new book "A Game as Old as
Empire", just published by Berrett-Koehler (San Francisco).
(END/2007)
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