Geneva

Geneva is a city in western Switzerland and one of the country's banking centers. It was the seat of the Banque de Commerce et de Placements (BCP), an affiliate the Bank of Credit and Commerce International (BCCI) held in secret, and of the Gulf Group of the Gokal brothers, a shipping group whose borrowing from BCCI was the subject of a 1.2 billion dollar fraud prosecution in London. The report of Senators John Kerry and Hank Brown listed the sale of BCP after BCCI's closure among the matters that required further investigation.¹²³

Swiss Bank Regulation

The first attempt at federal regulation of Swiss banks, a bill drafted in 1916, was set aside until the Depression. The collapse of the Banque de Genève in 1931 and the crisis of the Schweizerische Volksbank, which received a government bailout of 100 million francs in 1933, led to the Federal Banking Act, which came into force on March 1, 1935, and which a later finance minister called "a child of necessity."⁴

Banque de Commerce et de Placements

The Senate report described BCP as one of the "affiliated and related entities" that BCCI used as its losses grew, alongside ICIC in Grand Cayman, the National Bank of Oman and the Kuwaiti Investment Finance Corporation.⁵ BCP was headed by Alfred Hartmann, whom the report called one of BCCI's key "rent-a-faces." Bruce Rappaport, an Israeli-born Swiss businessman investigated in 1987 by an independent counsel, whom the report named as Robert McKay, over activities on behalf of the former CIA director William J. Casey, a frequent golfing partner, placed Hartmann on the board of his Intermaritime Bank of Geneva and New York.⁶ Aijaz Afridi, one of two long-time BCCI officials placed at First American New York who continued to draw benefits from BCCI while employed there, "had previously worked for another secretly-controlled BCCI entity in Switzerland, Banque de Commerce et de Placement of Geneva," and "was placed at the First American through Abedi's intervention," according to the report.⁷

BCP was sold to the Cukorova Group of Turkey within weeks of BCCI's closure in July 1991. The Senate report stated that Cukorova, through its subsidiary Entrade, had been involved with the Banca Nazionale del Lavoro in sales to Iraq, and that the sale, made "just weeks after BCCI's closure" and "prior to due diligence being conducted," "raises questions as to whether a prior relationship existed between BCCI and Cukorova, and Cukorova's intentions in making the purchase." It noted that Cukorova had also applied within the past year to buy a New York bank. It recommended further investigation by Swiss authorities and the Federal Reserve New York.³

Capcom and Paten Holdings

In the laundering of funds deposited at BCCI by Manuel Noriega through the commodities firm Capcom, 2.6 million dollars "was paid to a coded account at the Trade Development Bank in Geneva, Switzerland." Paten Holdings, a Panamanian company that made loans to the Capcom directors Magness and Romrell and was used on May 23, 1985, to raise Capcom's capital base from 10 million to 25 million pounds, was "operated out of Geneva by Mme. Cecile Ringenberg, and again, secretly owned by" Capcom's managing director, Syed Ziauddin Ali Akbar.⁸

The Gulf Group and Mohammed Hammoud

The Serious Fraud Office opened its inquiry into BCCI's loans to the Geneva-based Gulf Group in September 1992; its team examined and compiled documents at a police warehouse in Geneva. Its principal defendant, Abbas Gokal, was arrested at Frankfurt in July 1994 and sentenced to fourteen years in May 1997.² The Lebanese businessman Mohammed Hammoud, a BCCI front man who bought the shares in First American held by Clark Clifford and Robert Altman, allegedly died in Geneva in 1990 while visiting his doctor, and was buried in Beirut; the Senate report recorded that insurance companies reportedly refused to pay on his life policy "because Hammoud's corpse was found to be several inches shorter than the height recorded at his last medical examination."⁹