BCCI Kerry-Brown Senate Report

"The BCCI Affair: A Report to the Committee on Foreign Relations, United States Senate" was a December 1992 report co-authored by Senators John Kerry (D-Massachusetts) and Hank Brown (R-Colorado) summarizing a three-year investigation by the Senate Subcommittee on Terrorism, Narcotics, and International Operations into the Bank of Credit and Commerce International (BCCI). The 800-page report represented the most comprehensive official account of BCCI's criminal operations and documented the bank's relationships with intelligence agencies including the CIA.¹

Investigation Origins

Kerry's subcommittee investigation began in 1988, predating BCCI's July 1991 shutdown by three years. The subcommittee was originally focused on drug trafficking and money laundering when it first encountered BCCI through its investigation of Manuel Noriega's Panamanian bank accounts and the Medellín Cartel's financial infrastructure. Amjad Awan, BCCI's manager for Latin America and Noriega's personal banker, became a key witness after his arrest in Tampa in October 1988 as part of a U.S. Customs sting.

The investigation expanded dramatically after Manhattan District Attorney Robert Morgenthau brought BCCI evidence to Kerry's attention, and after Jack Blum, a former Kerry subcommittee investigator, continued developing sources within and around BCCI independently. The Bank of England's forced closure of BCCI in July 1991 and the simultaneous international criminal indictments gave the investigation new impetus.¹

Principal Findings

The Kerry-Brown Report documented BCCI's operations as a coordinated criminal enterprise operating across approximately seventy countries. Its principal findings included:

Money laundering: BCCI provided specialized services for laundering drug proceeds, particularly from the Medellín and Cali cartels in Colombia. The bank developed internal expertise in structuring transactions to avoid currency reporting requirements and created networks of shell companies and nominee accounts for high-level criminal clients.

Intelligence relationships: The report documented BCCI's role as a financial institution used by intelligence agencies including the CIA. It found that the CIA maintained accounts at BCCI and used the bank to finance covert operations, including weapons purchases for the Afghan Mujahideen and funding for other covert programs. The report found that senior U.S. intelligence officials had been aware of BCCI's criminal character years before the bank's closure and had not reported this to law enforcement.

Arms dealing and terrorist financing: BCCI provided financial services to arms dealers and terrorist organizations including Abu Nidal. The bank financed weapons transactions across multiple conflicts and maintained accounts for figures connected to state-sponsored terrorism.

Noriega accounts: The report detailed how BCCI had laundered Noriega's looted funds and drug trafficking proceeds, with BCCI officials actively assisting Noriega in concealing assets.

First American Bank: The report documented how BCCI had illegally acquired control of First American Bank, Washington's largest bank, through nominees including former Secretary of Defense Clark Clifford and his law partner Robert Altman. The report found that Clifford had either known of or been deliberately deceived about BCCI's role.

Saddam Hussein accounts: BCCI provided financial services to Saddam Hussein's government and facilitated transactions in the BNL (Banca Nazionale del Lavoro) Iraq credit scandal.¹

DOJ Obstruction Finding

One of the report's most significant conclusions was that the Department of Justice had obstructed investigation of BCCI. The subcommittee found that DOJ attorneys had declined to pursue leads provided by Customs agents and foreign prosecutors, had failed to coordinate with state prosecutors, and had negotiated a lenient 1990 guilty plea in Tampa that allowed BCCI to continue operating for more than a year while its criminal activities continued.

The report documented specific instances in which DOJ officials had received information about BCCI's full criminal character and had failed to act. It noted that federal law enforcement inaction had contrasted with the aggressive pursuit of the case by Morgenthau's Manhattan DA office, which operated under state rather than federal jurisdiction.¹

CIA Connections

The report's treatment of CIA-BCCI relationships was among its most sensitive findings. It documented that the CIA had used BCCI accounts for operational purposes and that CIA officials had been aware of BCCI's criminal character. It specifically found that:

• The CIA had accounts at BCCI used to finance the Afghan covert program
• CIA personnel had socialized with and obtained information from BCCI insiders
• Intelligence community knowledge of BCCI had not been shared with law enforcement in a timely manner

The report was careful to distinguish between CIA use of BCCI for specific operational purposes and broader claims about CIA management or direction of BCCI, finding the former clearly documented and the latter unproven.¹

Significance

The Kerry-Brown Report served as the primary public accounting of BCCI's criminal enterprise at a level of detail that neither the bank's criminal plea agreements nor subsequent prosecutions individually achieved. It provided the documentation base for subsequent historical accounts of BCCI and influenced ongoing prosecutorial efforts. The report also raised questions about the adequacy of financial regulation and the oversight of intelligence agency relationships with financial institutions that remained active in regulatory reform discussions through the 1990s.²