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Monday
Sep062010

Bill Black Says Treasury is Lying About Kabul Bank Bailout

Posted by Dr. Pitchfork.

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Not so fast, says Bill Black.  Don't let the smile fool you.  Both feared and revered, he's helped put many a bankster behind bars.  Nobody debunks Treserve BS better than Professor William K. Black.

Recently from Bill Black:

Story background:

 

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The New York Times, in a story entitled “Afghanistan Tries to Help Nation’s Biggest Bank” issued the following correction:

Correction: September 4, 2010

An earlier version of this article, citing American and Afghan officials, erroneously stated that the United States would contribute money to help the Kabul Bank. American officials say the United States is providing technical assistance but no funds for the bank.

The problem is that the “earlier version” was correct – the correction is incorrect.  Kabul Bank has been revealed to be a “control fraud.”  Control frauds occur when those that control a seemingly legitimate entity use it as a “weapon” to defraud.  Control frauds cause greater financial losses than all other forms of property crime – combined.  Control frauds can also cause immense damage to a nation because they are run by financial elites that curry favor from political elites.  The result is that they are often able to loot “their” banks for years with impunity.  They also degrade the integrity of the entire system.

Kabul Bank is a typical example of a crude variant of control fraud at a major bank.  Systems of crony capitalism, such as Afghanistan, inherently create an intensely “criminogenic” environment that produces epidemics of control fraud in the public, private, and non-profit sectors.  Kabul Bank, like the (originally Pakistani) Bank of Credit and Commerce International (BCCI) – better known to regulators as the “Bank of Crooks and Criminals International” is reported to have helped everyone – corrupt Afghani government officials, corrupt business leaders, and the Taliban laundering its drug profits to, in part, buy weapons.  Like BCCI, Kabul Bank’s managers’ reported frauds and self-dealing blew up the bank by causing massive losses.  If you believe that Kabul Bank is the only bank like this in Afghanistan you are consuming too much of Afghanistan’s leading export.

 

Continue reading at Naked Capitalism

 

 

 

 

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Reader Comments (5)

I bet most Americans do not even remember BCCI, memories are short when you must deflect responsibilities from ones own heroes. Trucks of cash have been seen leaving that country for some time.

We will probably just replace them with more trucks of cash, it does seem to be the way we operate these days...

http://en.wikipedia.org/wiki/Bank_of_Credit_and_Commerce_International
Sep 6, 2010 at 8:36 PM | Unregistered CommenterS. Gompers
I remember it...check this out gomp...

video is at the bottom...

http://dailybail.com/home/when-you-control-the-debt-of-war-the-players-are-mere-pawns.html

Film clip...from The International
Sep 6, 2010 at 9:20 PM | Registered CommenterDailyBail
The clip is no longer there.
Sep 6, 2010 at 10:21 PM | Unregistered CommenterS. Gompers
Sad but true. The banking sector is riddled with fraud across the globe. That Kabul may be one of the most egregious examples in a nation so utterly corrupt otherwise, is no surprise.

The corrections are coming, one way or another.
http://letthemfail.us/archives/5463
Sep 7, 2010 at 11:57 AM | Unregistered CommenterWil Martindale
Another great post wil...you are an excellent writer and thinker...

http://letthemfail.us/archives/5463

gomp...thanks for the heads up...i looked for replacement clips and they've all been banned by sony on youtube...
Sep 7, 2010 at 10:21 PM | Registered CommenterDailyBail

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