The IMF/BCCI Mugger

(Excerpted from Chapter 6: Bank of Crooks & Criminals International: Big Oil & Their Bankers…)

Since its inception, the International Monetary Fund (IMF) has violently abused the people of the developing world in its role as debt collector for the Eight Families Rothschild-led banking monopoly.

The banksters sink poor countries into debt via loans that benefit either their wholly-owned multinational corporations or well-placed domestic strawmen. The IMF then swoops in and orders the now-indebted country to privatize its economy – with the banker-owned multinationals picking up state assets for pennies on the dollar as part of “debt reorganization”. One of the Eight Families’ tentacles facilitates this kabuki dance for a healthy fee. More often than not it is Goldman Sachs.

Another part of the deal is to impose harsh austerity measures that hit the poorest people the hardest.  These measures include raising electricity rates, imposing a value-added tax or ending government subsidies for basic foodstuffs such as rice and beans.

If the country in question follows IMF mandates it receives yet more misdirected “loans” from the World Bank crowd and sinks further into debt.  If it does not, the country is cut off from international finance, its currency devalued and its economy ravaged by hyperinflation. Countries that can no longer repay their mounting debt become victims of even worse IMF abuse, including the outright theft of that country’s Treasury funds.

No case illustrates this type of IMF official mugging better than that of the mysterious Bank of Credit & Commerce International (BCCI).

Robin Hood in Reverse

Both the IMF and the Caribbean Development Bank (CDB) had close ties to BCCI.  The CDB was founded by David Rockefeller’s International Basic Economy Corporation – which launched the Caribbean Basin Initiative.  CDB loans money to countries that agree to allow multinational corporations to set up tax-free operations within their borders to take advantage of cheap labor.  These areas become known as export processing zones and give the corporations additional tax benefits from the US government.

BCCI – launched by Bank of America – was a CIA drug money laundry which moonlighted as mugger for the IMF bankers.  The IMF helped BCCI set up shop in numerous countries, including virtually every Latin American nation.  BCCI loaned the Jamaican government money to pay the IMF in return for Jamaican government deposits at BCCI.  Bolivia got BCCI loans under the same agreement, this time at the urging of the World Bank.  In Peru, the IMF/World Bank solicited Peruvian treasury deposits for BCCI.

None of these countries would ever see the over $1 billion in treasury funds which they collectively put down the BCCI black hole.  Peru later indicted a former IMF/World bank official for his role in the fleecing of Peru’s Central Bank.  While recycled petrodollars were being pumped into BCCI from the pockets of Gulf Cooperation Council (GCC) oil sheiks, and drug profits were derived from contra cocaine and mujahadeen heroin, BCCI was simultaneously swindling the central banks of some of the world’s poorest countries with a wink and a nod from the IMF and World Bank.

As Alexander Cockburn put it in a Wall Street Journal column, when BCCI was closed by the Bank of England in July 1991, “The little guys went to the wall and the big fish swam off with the swag”.

The racket worked something like this: BCCI, in addition to providing loans for deposits, would offer to broker a country’s debt with the IMF if the central bank was willing to deposit funds at BCCI’s local branch.  Those countries that cooperated with the IMF would be rewarded with more loans.  Those that refused never saw their money again.  Most of the $20 billion that disappeared when BCCI was shut down belonged to Third World central banks whose governments had not bent over far enough for the IMF.  This outright theft left the poorest, most debt-ridden countries in the world even more impoverished.  African nations were hardest hit.

Cameroon, where US AID had been BCCI’s biggest customer, lost one-third of its hard currency reserves.  Nigeria lost $300 million when BCCI crony Alhaji Ibrahim Dasuki bribed central bankers, then split with the cash.  For his troubles he was appointed Sultan of Sokoto, the Muslim capital of northern Nigeria.  The central banks of Zambia, Zimbabwe, Congo, Ivory Coast, Sierre Leone, Gabon, Senegal and Ghana were all pilfered by BCCI.  All failed to satisfy IMF mandates for new loans or were in arrears on old debt.  BCCI sponged over $2 billion from the African continent.

Even in England, where $400 million was lost by depositors when BCCI closed shop, most of the money belonged to African immigrants of marginal means who believed BCCI’s claim of being “a bank for the world’s poor”.

In Peru, populist President Alan Garcia, who in 2001 launched a stunning political comeback and nearly defeated former World Bank economist Alejandro Toledo in the Peruvian Presidential elections, suspended debt payments to the international banks in 1986.  Within months he was approached by Amjad Awan, Panamanian President Manuel Noriega’s personal banker who ran the BCCI Panama City branch through which Noriega received his $200,000/year CIA paycheck.

Awan suggested that Garcia use BCCI to hide what little hard currency Peru had stashed away from the IMF debt collectors.  Awan arranged bribes of over $3 million to be paid to Peruvian Central Bank officials through Security Pacific Bank and Swiss Bank Corporation of Panama.  The officials wired $250 million, 25% of all Peruvian Central Bank assets, to BCCI Panama.  Peru never saw the money again.

In Argentina, BCCI paid off officials to pull off a debt-equity swap so ludicrous that it involved BCCI buying Argentine debt for pennies on the dollar, then selling it back to Argentina for full price.  This happened under President Carlos Menem, the Bush-family friend who was brought down by a drugs and corruption scandal of which these phony debt-equity swaps were a part.  A big chunk of the $132 billion that Argentina “owed” the international bankers when it defaulted in late 2001 went down the BCCI rabbit hole.

BCCI specialized in facilitating capital flight from poor countries by helping rich Third World nationals start offshore accounts with the bank.  BCCI would hire siblings of wealthy clients to man its local branches.  In Bangladesh it helped deposed President Ershad loot the Bangladesh Central Bank on his way out of the country.  The Dacca BCCI branch was manned by Ershad’s relatives, who set up a foundation to avoid taxes while receiving BCCI kickbacks.  Aid received by BCCI-Dacca was diverted into offshore accounts of the Ershad family which BCCI helped set up.  When BCCI went under in 1991, 15,000 middle-class Bangladeshis lost their life savings.

Manuel Noriega did the exact same thing with BCCI-Panama, with many Panamanians losing their nest eggs as well.  In country after country BCCI aided a tiny group of elite IMF-connected families in robbing their nation’s treasuries, then moving the money offshore into accounts at Western mega-banks.  The global elite had once again shaken down the world’s poor.

As Manuel Salgado Tamayo, Ecuador’s former Vice President of the National Congress and once a candidate for President, put it, “…a world order…for the first time in the history of capitalism has the world’s population by the scruff of the neck.  This order, or world disorder, is neo-liberal globalization, whose postmodern philosophy expounds the death of reason and humanism, the total imposition of capital over labor, a ‘free’ market for the South vs. protectionism for the North, and a type of financial freedom that allows the rich to steal the savings of the poo

The US should pull its funding of the IMF and end this tax-payer subsidy of inbred banker brutality.

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