WASHINGTON -- Bert Lance, a budget director during the Carter administration, told a Senate panel yesterday that he played a key role in bringing the scandal-ridden Bank of Credit and Commerce International to the United States by urging the bank's founder to acquire a bank holding company that BCCI later acquired secretly and illegally.
Testifying before a Senate foreign relations subcommittee, Mr. Lance said that his contact with BCCI founder Agha Hasan Abedi began within weeks of his resignation under fire in 1977 as director of the Office of Management and Budget.
Mr. Lance said that he first asked his Washington counsel, Clark M. Clifford, to determine Mr. Abedi's integrity; after a quick probe turned up no apparent problems, Mr. Lance proposed that Mr. Clifford and his protege, Robert A. Altman, become legal advisers to Mr. Abedi and BCCI in their prospective U.S. operations.
BCCI then proceeded, at Mr. Lance's urging, to attempt to acquire a Washington-based bank holding company, Financial General Bankshares. BCCI succeeded in acquiring the company through intermediaries three years later, although by then FGB had been renamed First American Bankshares.
Mr. Clifford became chairman of First American, and Mr. Altman was president of a subsidiary. Both resigned under pressure in August. They have steadfastly insisted they had no idea BCCI was the actual, albeit illegal, owner of their bank. Both are due to testify before the subcommittee today.
Mr. Lance, who resigned as OMB director and later was acquitted of bank fraud charges, is cooperating with the subcommittee's investigation of BCCI.
The Luxembourg-based bank and its two top executives were accused last summer by a New York grand jury of fraud and theft of more than $30 million from depositors.
Urged on by subcommittee Chairman John F. Kerry, D-Mass., who has sought to find an improper relationship between BCCI and the Central Intelligence Agency, Mr. Lance speculated that the CIA had converted the bank to its own purposes and diverted Mr. Abedi from his role as a "Third World liberal" and benefactor of former President Carter to kingpin of an international banking fraud.
Mr. Abedi, he said, told Mr. Lance in late 1983 that "from the precise moment Ronald Reagan was sworn in as president, I have been on the CIA watch list, my every movement, as well as BCCI, is under surveillance by the CIA. . . . You have to understand I fall into the category of being a Third World liberal."
After a year or so, Mr. Lance said, Mr. Abedi seemed less concerned about the CIA. Mr. Lance's conclusion: "At some point in time I think there was an overt effort by our intelligence agency to co-opt Mr. Abedi and turn him into the bank of the CIA." But he said he had "no evidence" to support that belief.