Senator says Justice Department is unwilling to prosecute in BCCI scandal

November 04, 1991|By New York Times News Service

WASHINGTON -- The senator who has led the congressional investigation into the Bank of Credit and Commerce International says that while his inquiries have etched the broad outlines of wrongdoing at the bank, the Bush administration and the Justice Department are dragging their feet on prosecuting the wrongdoers.

Sen. John F. Kerry, D-Mass., said he had prodded Justice officials to act against BCCI since early 1989, when he turned over to the department tape-recorded conversations of bank employees and other evidence of crimes.

He said he remained mystified by a lack of indictments against the bank or its officials.

"I truly do not have the answer; it raises huge questions," Mr. Kerry said in an interview. Mr. Kerry heads the Senate Foreign Relations subcommittee, which monitors terrorism, narcotics and international operations.

"It just represents part of the current problem of government and the unwillingness or inability to respond to very clear imperatives," he said. "I think people are fed up, and I don't blame them, because they don't see a response."

Yesterday, John H. Sununu, the White House chief of staff, joined Justice Department officials in insisting that the department is vigorously pursuing its inquiry into BCCI and its illegal takeover of the First American Bank of Washington.

Mr. Kerry suggested that the initial phase of investigations into BCCI was nearing an end and that he would move next into hearings on the regulatory and legislative steps required to prevent a recurrence of the kind of practices that flourished for nearly a decade without corrective action by federal authorities.

Bush administration officials continue to insist that they are in hot pursuit of BCCI, but thus far the Justice Department has brought only one successful case against the bank, in Tampa, Fla.

The prosecution resulted in a plea bargain in 1990 in which several bank officials pleaded guilty and the bank itself was fined $15 million, a penalty criticized by some in Congress as a slap on the wrist for an institution whose actions resulted in financial losses estimated between $5 billion and $15 billion.

Department officials insist that their inquiry will yield larger results soon.

But privately, some lawyers following the case say the investigation inched along until July, when seven countries shut down BCCI's far-flung operations after British authorities discovered evidence of a huge fraud.

It was then that a furor arose in Congress and the news media over the bank's international lawlessness.

In an appearance on the CBS News program "Face the Nation" yesterday, Mr. Sununu defended the investigation of BCCI by the Justice Department.

"I think they think they've done an awfully good job," he said. "I think they are cooperating with everybody who is looking into it."

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