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Wall Street Journal 9/29/98 “... We know that the world’s largest bank fraud can go almost unnoticed, except to Manhattan District Attorney Robert Morgenthau. We refer, in case you’ve forgotten, to the Bank of Credit & Commerce International, which was back in the news in two jurisdictions last week. In Washington, Clark Clifford and Robert Altman agreed to give up $18.5 million in claims on stock and legal fees connected with First American Bankshares, the BCCI front they once headed in the nation’s capital. In Luxembourg, BCCI auditors Price Waterhouse and Ernst & Young agreed to a payment of $125 million to the defunct bank’s customers; the creditors will now recover more than half their money—more than quadruple the best estimates at the time BCCI went under. These people, many of them Pakistani nationals in Britain, will be mighty glad that Mr. Morgenthau pursued the case when the Bank of England, the Justice Department and various others ducked. Yet for all the smoke Mr. Morgenthau uncovered we have only glimmers of the fire that led to it all. There are still unresolved questions about the political patronage that has helped shield BCCI principals from a full reckoning, and in particular about how a crooked Pakistani-Arab bank got control of the largest bank in Washington, D.C. In this respect, the Altman-Clifford settlement is particularly striking. At issue has always been whether the two knew that BCCI was the real owner of First American, of which they were, respectively, president and chairman..”

Wall Street Journal 9/29/98 Yet the essential mystery remains. Doubtless that’s just the way many would like to leave it, because the names that pop up read like some kind of Who’s Who. There is, to begin with, a large Arkansas connection, since Little Rock investment giant Stephens Inc. assembled the bloc of First American stock for the BCCI front men. Assisting in these transactions was the now-famous Rose Law Firm, then headed by Joseph Giroir, more lately a representative of the Riady family of Indonesia and participant in the notorious September 13, 1995, Oval Office meeting at which John Huang was dispatched to his fund-raising tasks. Rose Attorney Hillary Rodham represented a Stephens subsidiary, the Systematics bank-data processing firm, in a related lawsuit. James Riady made his first appearance in Little Rock about the time these transactions took place, with his family ending up with a piece of the Stephens-dominated Worthen Bank. Another player was Bert Lance, Jimmy Carter’s disgraced head of Office of Management and Budget, who apparently hoped to head First American himself. All of these people deny that they knew anything crooked was taking place, just a group of smart, well-connected Friends of Bill stunningly ignorant about the people they were doing business with. Yet since the mystery has never been cleared up, you can’t blame those of us who followed it from remembering names as they turn up in today’s news. Nicholas Katzenbach, for instance; the former Attorney General surfaced last week with two of Mr. Clinton’s serial White House counsels, defending the President against impeachment in a New York Times op-ed. We remember that Mr. Katzenbach replaced Mr. Clifford when the latter resigned from First American in 1991. Ditto for John E. “Jack” Ryan, who ended up as head of the Resolution Trust Company and denied Rep. Jim Leach’s request for documents relating to Madison Guaranty Trust, the Whitewater S&L. We remember that it was under Mr. Ryan’s watch as head of bank supervision at the Fed that BCCI won approval to buy First American..”

Click Here for the full Senate report on BCCI

The American Spectator 12/96 James Ring Adams “...The Indo-money affair is cut from the same cloth as the scandal of the Bank of Credit and Commerce International, which earlier this decade led to the bank fraud indictment of former Defense Secretary and presidential adviser Clark Clifford. (The federal and New York State case against Clifford was later dropped because of his advanced age and the acquittal of his associate Robert Altman on similar charges.) The BCCI was trying to buy hidden control of American banks to build its global empire and also to wield influence for its Arab patrons. The Riadys and their allies had in addition the motive of sheer survival. They have been investing in Bill Clinton for twelve years, and one can understand why they would disregard American campaign law in the effort to preserve their stake. Where things get shocking was in the arrogant response of the White House and the Democratic National Committee when the scandal erupted. In quantity and quality the Indo-money case dwarfs any influence-peddling scandal in memory, even for those who recall the worst of the Nixon years. When the slumbering press awoke to the story (about a year after TAS put it on our cover), it discovered that the Riadys had managed to place a former senior employee of their Lippo Group inside the Clinton administration, with extraordinary access both to the Oval Office and to Asian contributors. But John Huang, with his $4 million in DNC fund-raising and fifty visits to the White House, was a relatively small player in a network that included the richest men of South Asia. Even the Riadys were only one of several conduits in a political penetration that may have shaped human rights and trade policy and even diplomatic relations with a number of countries along the Pacific Rim, including the most sensitive one of all, the People’s Republic of China....”

James Ring Adams 10/92 The American Spectator “…. Even after the sharp contraction of Worthen Bank’s ambitions, Jack Stephens and Stephens Inc. kept their foreign deals going. The one now gaining most notoriety put together Saudi money men, elements of the BCCI network, and George W. Bush, eldest son of the President. The deal, first reported by David Twersky of the Forward and then covered in some depth by the Wall Street Journal, provided financing for the Harken Energy Corp. of Houston. Eyebrows were raised when this small and untried company landed a “potentially lucrative” offshore drilling contract with the Persian Gulf princedom of Bahrain. Many saw it as no coincidence that George W. Bush, often called George, Jr., sat on the board of Harken with a consulting contract worth as much as $120,000 a year. But the fascinating details came in the financial history that put George Jr. in this position.

In the late 1970s, George Jr. tried to emulate his father’s business success in the Oil Patch by setting up a series of drilling partnerships. Called Arbusto ‘78, Arbusto ‘79, and so forth, they attracted capital from, among others, a Houston aircraft broker and financial manager named James Bath, who according to a former associate had acted as liaison between Saudi businessmen and the Central Intelligence Agency in 1976, the year in which George Bush, the elder, served as director of central intelligence. Bath’s associate also disclosed in the course of a bitter legal fight that Bath managed millions of dollars of Houston investments for Sheik Khalid bin Mahfouz, the most important commercial banker in Saudi Arabia and for a time one of the largest shareholders in BCCI. Manhattan District Attorney Robert Morgenthau indicted Sheik bin Mahfouz this July for a “scheme to defraud” in connection with his investments in BCCI. George W. Bush has given conflicting statements about Bath’s investment in Arbusto, finally admitting to the Wall Street Journal that he was aware that Bath represented Saudi investors.

The Arbusto partnerships were busts as money-makers, but the investors managed to recoup their stakes through several stock swaps that wound up giving them shares in Harken Energy. But Harken itself needed help, and George Jr. gave it a boost in finding new financing through Stephens Inc. George Jr. attended a meeting in Little Rock between Harken officials and Jackson Stephens that produced an unusual rescue plan. Mr. Jack obtained a $25 million cash infusion for Harken from Union Bank of Switzerland, which rarely invested in small American companies. ……”

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