Kerry slams Bank on BCCI

The Observer ^ | 19/12/04 | Conal Walsh

[flitton]

Senator John Kerry has slated the Bank of England over its handling of the BCCI banking disaster and warned that the City remains vulnerable to another major scandal. The defeated presidential candidate's words will boost BCCI's creditors, who are suing the Bank of England for allegedly turning a blind eye to fraud at BCCI. Kerry expressed solidarity with the creditors yesterday and told The Observer: 'The Bank of England failed to supervise BCCI properly.'

Kerry is an acknowledged expert on the long-running BCCI affair, having led a US Senate investigation into the rogue bank more than 10 years ago. BCCI, headquar tered in London, collapsed in 1991 with undeclared debts of £7 billion.

Kerry also said yesterday that banking supervision had improved since BCCI but warned it was 'still necessary' for regulators on both sides of the Atlantic to tighten their anti-money laundering procedures. 'Financial transparency is more important than ever, and we're going to need to continue to be vigilant to prevent any would-be rogue bank from creating another round of victims,' he said.

Following BCCI's crash, the Bank of England was criticised by Kerry and others for failing to protect investors and depositors. It was later stripped of its regulatory functions, which were passed on to the newly-created Financial Services Authority.

BCCI's victims are currently suing the Bank of England for up to £1bn compensation, alleging that Thread- needle Street officials acted with wilful negligence amounting to 'misfeasance in public office'.

The high-profile case at the High Court in London is expected to run for at least another year.

The Bank of England denies the allegation and is fiercely resisting the claim, which threatens to remove the statutory immunity that government departments have against being sued. A Bank spokesman declined to comment on Kerry's remarks, but added: 'Public officials in America enjoy the same immunity'.

Christopher Grierson of Lovells, the law firm representing BCCI's creditors, said: 'We are very pleased to hear that Senator Kerry supports our action.'

[investigateworld]

If Kerry pushes this, Theresa best be digging out her widow's clothes. These are hardball players all the way.

[Libloather]

Check it out -

Lawyer nears end of record-breaking speech
Wed May 25, 5:28 AM ET

LONDON (Reuters) - A British lawyer will conclude on Wednesday what is believed to be the longest speech in the country's legal history, breaking the record set last year by his rival in the same protracted courtroom wrangle.

Nicholas Stadlen has spent 119 days presenting the case for the Bank of England which is defending an 850 million pound compensation claim by creditors of collapsed Bank of Credit and Commerce International (BCCI), the Guardian newspaper reported.

When Gordon Pollock, BCCI's lawyer had finished his 80-day long opening remarks last year, Stadlen finally stood and said: "After six months the empire strikes back."

The case is so complex that a five foot high stack of files -- dubbed the Berlin Wall -- has grown between the two legal teams.

BCCI was closed in 1991 by regulators in a worldwide swoop, partly organised by the Bank of England, after it discovered the lender had disguised losses and was insolvent.

Liquidators of BCCI brought a legal suit against the Bank of England alleging the central bank wrongly licensed BCCI when it had not met the necessary Banking Act criteria.

[FormerACLUmember]

Almost equals Bill Clinton's interminable speech nominating (I think) Dukakis in some old democrat convention.

I like the reseach earlier in the post that Jamie Gorelick, the Clinton deputy attorney general (and Hillary agent) who in private life represented Clark Clifford and Robert Altman, the pair who ran Washington's First American Bank when it was illegally owned by BCCI.