Kabul Bank scam involved up to 40 persons

As many as 40 people were allegedly involved in scams to bilk hundreds of millions of dollars from the Kabul Bank, and nearly half the cases will be sent to the Afghan court system next week, a top Afghan prosecutor said Sunday.
The charges are the first to be referred to Afghan courts in connection with the bank's near collapse last year because of mismanagement and questionable lending. A USAID inspector general report estimated that $850 million in loans were diverted to bank insiders.
The troubled Kabul Bank, which is now partly controlled by the Afghan central bank and the Ministry of Finance, has became a symbol of the country's deep-rooted corruption. The case is being closely followed by Afghans and international donors because it is a barometer of officials' pledge to root out patronage, graft and show accountability to world financial institutions, such as the International Monetary Fund.
Deputy Attorney General Rahmatullah Nazari said the charging papers would name Sherkhan Farnood, the former chairman of Kabul Bank and a world-class poker player; Khalilullah Ferozi, the former chief executive officer who has been co-operating with prosecutors; and more than two dozen other current and former employees of Kabul Bank and the Afghan Central Bank. "It's a very big case and not a simple case," Nazari told The Associated Press in an interview in the Afghan Attorney General's compound, adding that the allegations include corruption, abuse of authority, preparing fake loan documents or receiving illegal loans. He said between 30 to 40 people were involved in the scams.
The names of about 15 individuals, including the two former bank executives who are being held in a Kabul detention center, will be the first submitted to the courts, Nazari said. In addition, a team of prosecutors continues to investigate allegations of impropriety against another 15 or so individuals who have fled the country since the bank crisis unfolded last year. "All of these people are accused. We have strong evidence against them, and I think they will be sentenced to jail," Nazari said through a translator. "If a person is involved in the corruption of some $900 million and is not sentenced or given any punishment, what will happen to people who are involved in the corruption of just $1 million."