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BCCI's support of terrorism and arms trafficking developed out of several
factors. First, as a principal financial institution for a number of Gulf
sheikhdoms, with branches all over the world, it was a logical choice for
terrorist organizations, who received payment at BCCI-London and other
branches directly from Gulf-state patrons, and then transferred those
funds wherever they wished without apparent scrutiny.
Secondly, BCCI's flexibility regarding the falsification of documentation
was helpful for such activities. Finally, to the extent that pragmatic
considerations were not sufficient of themselves to recommend BCCI, the
bank's pan-third world and pro-Islam ideology would have recommended it to
Arab terrorist groups.
Arms trafficking involving BCCI included the financing of Pakistan's
procurement of nuclear weapons through BCCI Canada, as documented in the
Parvez case, involving a Pakistani who attempted to procure nuclear
related materials financed by BCCI through the United States.
In a November 22, 1991 letter to the Subcommittee, the CIA stated that
"the Agency did have some reporting [as of 1987] on BCCI being used by
third world regimes to acquire weapons and transfer technology," but was
unwilling to elaborate on the nature of this activity in public.
In early August, 1991, the Committee was provided with documents from the
Latin American and Caribbean Region Office (LACRO) of BCCI, describing the
offer for sale by the Argentine air force of 22 Mirage aircraft for $110
million. The planned sale was to have been made to Iraq, as part of
Saddam Hussein's massive military buildup prior to the Gulf war.
BCCI was acting as the broker for the transaction, which was to take place
in August or September of 1989, but not completed as a result of a dispute
within the Argentine military itself. Arms sales involving BCCI from
Latin America to the Middle East remain, as of April 1992, under active
investigation by U.S. law enforcement.
Main Page:
The
BCCI banking scandal.
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