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New Kabul Bank

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433:(IMF) delegation. "The deputy secretary... stressed the need for the Afghan government to take swift and decisive action to ensure a credible, effective resolution of issues related to Kabul Bank," the U.S. embassy said in statement. Kabul Bank was put into receivership following the scandal and a new bank set up, but only $ 70 million of fraudulent loans it granted have so far been recovered, with criminal investigations ongoing. In October 2011, Afghanistan's parliament approved a $ 51 million payment to DAB as part of a planned compensation package over its multi-million-dollar bailout; the payment is part of a package of government measures agreed with the IMF to secure a new loan. Afghanistan has been without an IMF program since the Kabul Bank failure, but the IMF announced that it is moving ahead on a new $ 129 million loan in the wake of the government's reform promises, with a new program expected to be submitted to the IMF executive board for approval in November 2011. 616: 414:, saying it would be privately owned again within three years. "Kabulbank is stabilised, it has enough cash at its disposal and the central bank is trying to rehabilitate the bank and then at some point sell it to potential buyers in two or three years," Fitrat told Reuters. In early July 2011, Fitrat resigned as head of the central bank after fleeing to the United States, claiming his life had been threatened and that he was being made a scapegoat for politically connected individuals. 447:, the country's first vice president. Both Farnood and Frozi were arrested in Kabul and held without charge, even though Afghanistan's attorney general said the evidence against them was "quite clear". Without a successful resolution of Kabul Bank's problems, one senior U.S. official said Afghanistan could face "the collapse of the banking sector." As of October 2011, neither man had yet been charged with a crime, but Deputy Attorney General 230:. In September 2010, one of the principal owners of the bank said that depositors had withdrawn $ 180 million in two days and predicted a "revolution" in the country's financial system unless the Afghan government and the United States moved quickly to help stabilize the bank. In November 2010, reports appeared that Farnood and chief executive Khalilullah Frozi both had been sacked from duties; as of early 2011 both were effectively under 666: 371:
audit not only Kabul Bank accounts but also other private banks in Afghanistan", an Afghan presidential spokesman announced in late October. Earlier in the month, the government also froze assets held by some of Kabul Bank's owners even as the central bank governor said it was solvent and had the backing of Karzai's administration. U.S.-educated economist Hamidullah Farooqi, a former Karzai minister and chairman of the
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Khan Farnood and Khalil Ferozi, appeared before the court to defend themselves. Some $ 935 million of the bank assets was transferred abroad through various systems and $ 825 million are needed to bail out the bank. The Afghan government will have to pay 5–6% of its GDP to save the bank, which would be a huge blow to the country's economy.
454:"A crime has happened", Nazari said. "They will go to the court whether they manage to secure the money or not". Authorities loosened the terms of their detention and provided them with a security detail to go to a bank office on workdays and on occasion to fancy restaurants and hotels for what Nazari described as work meetings. 150: 375:, said Afghanistan received a "massive wake-up call" from the crisis, further stating: "It's not just a lack of capacity in our institutions, there is a lack of laws and a lack of accountability, which is much more serious. It's a case of the blind leading the blind. They are too young, they are babies." 483:(NPR) and others, have reported that widespread corruption, ponzi schemes, fraudulent loans, mass looting, insider loans to fake and bogus companies run by family and friends, and other corrupted practices, were undertaken by a small group of Afghan insiders (less than 12 people), apparently linked to 515:
Committee published its report and declared in a news conference that US$ 5 billion, including $ 400 million the Kabul Bank's shareholders, were illegally transferred abroad. About 22 people are accused of embezzlement in the case, and their trial started. At three hearings, 18 people, including Sher
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In September 2010, the Afghan Central Bank said it was prepared to provide loans to the Kabul Bank, "if it requests". After the bailout by the government, by 2015, authorities were inviting bids to privatize the new bank. In 2016, Afghanistan's Joint-Stock Company offered to buy New Kabul Bank for $
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After only six years in operation, in 2010 there was a panic of customers seeking to withdraw their savings from the bank. Despite nearly $ 1 billion in U.S. taxpayers' funded assistance in the form of Afghan government salaries deposited into Kabul Bank, Kabul Bank was on the brink of collapse and
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In early February 2011, DAB Governor Abdul Qadir Fitrat said the central bank would impose stricter rules on banks wanting to handle about US$ 1.5 billion worth of salaries for government and security officials, which until now has been done by Kabul Bank. Fitrat also told Reuters the total amount
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At the beginning of September, Frozi, one of the two largest shareholders of Kabul Bank, said reports indicating that the institution had lost as much as $ 300 million were overstated. But he predicted that if Afghan depositors continued to withdraw their money at the current rate, Kabul Bank would
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During the bank scandal and panic in September 2010, hundreds of Afghans, including many civil servants and their families, gathered outside Kabul Bank offices in the capital and elsewhere in Afghanistan. Long lines formed of depositors hoping to withdrawal some or all of their money. Afghan police
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Despite Kabul Bank's near collapse in 2010 during the corruption allegations, Kabul Bank claims it is significant to Afghanistan's internal security and stability because it is the vehicle used to pay, largely with money supplied by the United States government, as many as 300,000 Afghan government
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In January 2014, the International Monetary Fund's (IMF) representative Wabel Abdallah, who assisted in the Kabul Bank crisis aftermath, was murdered by suicide bombers and gunmen in Kabul along with some 21 others in a high-profile attack that the Taliban said they undertook. Abdallah headed the
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almost certainly collapse, undermining confidence in the nascent financial system the Afghans have been trying to build with American help. "If this goes on, we won’t survive", Mr. Frozi said in an interview. "If people lose trust in the banks, there will be a revolution in the financial system."
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Afghan leaders promised to guarantee deposits in an attempt to arrest the panic, which began at the end of August 2010 when the country's top banking officials demanded the resignations of both Frozi and Farnood. "The government has decided that there will be an audit firm that will be coming to
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Banking experts, economists and humanitarian aid officials have expressed serious concern about this development given Kabul Bank's large and historic dependence on U.S. taxpayers' funding of bank deposits via payments of the Afghan National Army soldiers, police and Afghanistan's civil service
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employees of Kabul Bank fled to Pakistan, apparently out of fear for their lives and possible arrest, though some said they were being made scapegoats for powerful shareholders. Afghan authorities also called in several bank managers, including foreigners, for questioning and detained some in
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In 2011, 38 customers at the bank's branch in Jalalabad were killed by a Taliban bombing. Fighting with security forces lasted four hours, and four of the attackers were killed. Two men were later charged for the attack and executed in June 2011. A third person was sentenced to prison.
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re-opened efforts to bring former Kabul Bank officials involved in the Kabul Bank Crisis to justice, extend and enforce prison sentences for those previously convicted, and seek to recover hundreds of millions of U.S. and Afghan taxpayers' dollars in funds stolen or lost by
261:-led insurgency. President Karzai's brother, Mahmood Karzai, is reported to have played a significant role in the bank scandal, and is alleged to have received millions of dollars in loans from Kabul Bank. He was later alleged to be under investigation by a U.S. Federal 442:
reported that Farnood and Frozi used fake names, forged documents, fictitious companies and secret records as part of an elaborate ruse to funnel hundreds of millions of dollars to shareholders and top Afghan officials, including President Karzai's brother Mahmood and
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and other insiders were spending the bank's US$ 1 billion for their own personal lavish style living and lending money under the table to family, relatives and friends. The bank scandal also involved members of Afghan President Karzai's family, including his brother
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inspector general report estimated that fraudulent loans diverted $ 850 million to bank insiders. By October 2011, more than a year after the government seized control, officials had recovered less than 10 percent of the nearly $ 1 billion that went missing.
327:, and at least three militants were killed, officials said. Three suicide bombers reportedly entered the bank and detonated themselves, and fighting between insurgents and security forces continued for over four hours; President Hamid Karzai and a 234:
and could not leave the country, and in July 2011 both were formally arrested and detained in Kabul. DAB stated in February 2011, it would seek to sell Kabul Bank within three years once it was rehabilitated, but both the
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The U.S. government has found anti-corruption efforts in Afghanistan in the wake of the Kabul Bank crisis as deeply troubling, including the banking sector, according to reports by the Washington Post in 2012 and SIGAR.
595:, where government workers waited in line to collect salaries. 34 people were killed at least, and 125 injured. In June 2017, a Taliban suicide bomber killed 29 people at a Kabul Bank branch in the Helmand province. 466:
and the loss of nearly U.S. $ 1 billion in U.S. taxpayers' funded foreign assistance to Afghanistan in the form of U.S.-supplied Afghan government and Afghan military and police salaries deposited into Kabul Bank,
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reported that Mahmood Karzai could soon be indicted for tax evasion in the U.S., though he denied the charges, telling the newspaper: "I'm very clean", and insisting his only interest was "rebuilding Afghanistan."
602:, where it was the only bank in the region. That month, a suicide bomber targeted the Kabul Bank branch entrance close to the US embassy, resulting in five reported deaths. The Taliban claimed responsibility. 1568: 410:
of money at risk over suspected irregularities at Kabul Bank amounted to $ 579 million, almost twice the figure estimated when the bank's troubles first surfaced. Fitrat dismissed concerns that it faced
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On 27 December 2010, a suicide car bomber killed at least three Afghans, including one policeman, as he targeted police officers who lined up to withdraw their salaries in front of Kabul Bank in central
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Transparency International has raised concerns about the impact of corruption on the banking and financial sector in Afghanistan and its controversial links to the public sector and public officials.
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secretary, the Afghan finance ministry said that weak international support had exacerbated the crisis. "Afghan and US officials agreed that (the crisis)... was compounded by the erroneous audit by
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Wall Street Journal,(16 February 2011), "Grand Jury Investigates Karzai Brother U.S. Federal Probe Risks Worsening Relations With the Afghan President; Mahmood Karzai Hires a Washington Lawyer"
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Since 2011, the Karzai Government has rejected banking oversight and reform efforts by the United States in the wake of the Kabul Bank scandal and collapse according to reports by the U.S.
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employees who are largely paid with billions of dollars in U.S. aid to the Karzai government and to Afghanistan from the U.S. Congress, U.S. Treasury and ultimately U.S. taxpayer.
218:, in 2012, headlines indicate "Audit Says Kabul Bank Began as 'Ponzi Scheme'" following investigation and judicial action in the aftermath of the Bank's crisis and scandal. 1076: 1343: 838: 425:, and ineffective international technical assistance and supervision", the ministry said. However, Wolin pressed the government to rapidly place the lender into 1366: 1023: 1515: 180:
facility, which enables fund transfer for its customers. The bank has correspondent relationship with seven international banks situated in Germany, China,
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In April 2015, the Islamic State or an associated group claimed responsibility for a suicide bombing at the entrance of a New Kabul Bank branch in
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is one of the brothers of Afghan President Hamid Karzai and a seven-percent shareholder in the bank. In a telephone interview with the
1935: 1910: 1905: 120:. The bank provides facilities to maintain accounts in Current, Savings Bank, and Fixed deposits; and offers its consumers branch and 38: 133: 372: 319:
On 19 February 2011, at least 38 people (including 13 policemen) were killed during an insurgent raid on a branch of Kabul Bank in
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Kabul Bank was badly shaken and almost collapsed in 2011, in one of "the worst banking scandals in history", according to
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In its July 2011 review of the Kabul Bank scandal and its aftermath, international non-governmental organization (NGO)
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employees, mostly military and police, who are key to plans to rebuild Afghanistan's capacity to deal with its ongoing
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mobs of customers massed outside of bank locations trying to get their deposits out of the bank with limited luck.
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by the bank's insiders. Ghani vowed to seek to continue the investigation of the Kabul Bank crisis and fight
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Davidson, Amy, The New Yorker (7 June 2012), "The Karzai Rule : Who Pays for Corruption in Afghanistan"
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In August 2017, there were reports of long lines and slow services at the New Kabul Bank branch in the
1492:"AFGHANISTAN'S BANKING SECTOR: THE CENTRAL BANK'S CAPACITY TO REGULATE COMMERCIAL BANKS REMAINS WEAK" 1338: 833: 1212: 684: 109:
in Afghanistan. After corruption and scandals it was re-established in 2011 as the New Kabul Bank.
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International Wire, CNN (28 November 2012) "Widespread Corruption at Kabul Bank in Afghanistan"
1418: 492: 208: 1804: 1188: 1051:"Mahmoud Karzai being investigated for racketeering, extortion and tax evasion – Macleans.ca" 935: 599: 403: 360: 222: 212:, independent investigators and journalists uncovered widespread corruption in Kabul Bank. 1397: 1371: 1028: 997: 902: 438: 389: 355: 1516:"Afghan central bank's 'fragile state' increases risk of new banking crisis, audit finds" 1491: 629:
Please help update this article to reflect recent events or newly available information.
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spokesman condemned the attack, which was the deadliest in the country since June 2010.
1050: 793: 484: 444: 378: 227: 165: 898:"Kabul Bank employees flee to Pakistan amid investigation into lending, officials say" 1894: 311:; the midday explosion also wounded 16 policemen and five civilians, officials said. 671: 572:
After corruption and scandals it was re-established in 2011 as the New Kabul Bank.
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Following the departure of Afghanistan's President Hamid Karzai in 2014, President
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and US officials subsequently pressed for a rapid wind down of the institution. A
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and its impact on the economy, business investment, security and civil society.
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beat back mobs at the Kabul Bank worried their money would be lost according to
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that enriches politically connected insiders and dismays the Afghan populace."
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in September 2010, he said: "America should do something." In October, the
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also made a bid, as New Kabul Bank was to be privatized in October 2018.
585: 581: 398: 308: 966: 720:"Afghan finance minister admits doubts over Kabul Bank's missing $ 1bn" 258: 499:
and other off-shore locations and unknown offshore bank accounts and
176:. Kabul Bank claims that it is connected throughout the globe with 1077:"Hamid Karzai's brother made £500,000 on Kabul Bank property deal" 557: 496: 240: 177: 148: 98: 68: 1805:"At least 18 killed in Afghanistan in suicide bombing, airstrike" 1754:"Afghan Firm Offers $ 31 Million to Buy Defrauded New Kabul Bank" 1587:"US aid will boost Ukraine, but doubts remain over 2025 supplies" 1117:"Hushed up scandal of the Kabul Bank – The Afghan banking crisis" 275:
magazine reported that Mahmoud Karzai was being investigated for
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Kabul Bank claims that accounts can be opened and maintained in
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After a mid-February 2011 visit by Neal Wolin, the U.S. deputy
1780:"Pakistan's MCB Bank Bids to Buy Afghanistan's New Kabul Bank" 1569:"U.S. finds Afghan anti-corruption efforts 'deeply troubling'" 1264:"Afghanistan's anti-corruption efforts thwarted at every turn" 1239: 609: 397:
In mid-January 2011, acting chief financial officer and other
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It is the main bank used to pay the salaries of the national
1316:"Karzai's brother calls on US to help avert Afghan bank run" 1474:"Billions of Dollars Sent Illegally Abroad from Kabul Bank" 1174:"Karzai's brother might be indicted for evading U.S. taxes" 511:
On 28 November 2012, the Independent Joint Anti-Corruption
829:"Afghan government orders all private banks to be audited" 82: 1334:"Afghan parliament approves $ 51m payout over Kabul Bank" 741:"Report cites extensive corruption involving Afghan bank" 1832:"Paktika residents unhappy with New Kabul Bank services" 1633:"Kabul Bank fraud: Ghani reopens Afghan corruption case" 695:
Special Inspector General for Afghanistan Reconstruction
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Special Inspector General for Afghanistan Reconstruction
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Higgins, Andrew; Londono, Ernesto (3 September 2010).
1208:"Afghan Bomber Targets Officers, Kills at Least Three" 735: 733: 1301:"The Kabul Bank Scandal and the Crisis that Followed" 1543:"Report: Afghan banking authority rejects U.S. help" 451:
said the government intends to bring them to court.
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in connection with illicit transfers of bank funds.
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2014 murder of IMF official and executive sentences
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The bank is under the supervision of the 78: 64: 54: 44: 1656: 1654: 1444:"Karzai Brother Being Investigated For Corruption" 1189:"Depositors Panic Over Bank Crisis in Afghanistan" 1172:Higgins, Andrew; Markon, Jerry (15 October 2010). 1095: 931:"Afghan official: 2 Kabul Bank officials arrested" 789:"Depositors Panic Over Bank Crisis in Afghanistan" 359:reported that the Kabul Bank played a part in "a 962:"Afghan cbank says will sell troubled Kabulbank" 132:), the General Directorate of Treasury, and the 97:that has its main branch in the capital city of 1024:"In Kabul Bank scandal, little money recovered" 993:"Kabul rebukes outsiders over bank crisis role" 1139:"Karzai Family Moves to Protect Its Privilege" 1132: 1130: 1097:"Banker feeds crony capitalism in Afghanistan" 507:2012 anti-corruption report and reform efforts 1367:"Elaborate ruse behind vast Kabul Bank fraud" 373:Afghanistan International Chamber of Commerce 265:and U.S. tax authorities, including the U.S. 8: 1608:"'Important symbolic act' – DW – 10/03/2014" 221:In 2010, it was disclosed that its Chairman 30: 1286:"In Afghanistan, signs of crony capitalism" 986: 984: 341:raised repeated concerns about problems of 287:as a result of connections to the bank and 1857:"Suicide bomber targets Kabul Bank branch" 1017: 1015: 867:"Why Farnood was flushed out of Kabulbank" 760:"Kabul Bank Audit Details Extent of Fraud" 206:newspaper. In late 2012, according to the 29: 1409:Sorkin, Amy Davidson (1 September 2010). 891: 889: 782: 780: 1235:"Insurgents raid Afghan bank; 38 killed" 540:IMF's office in Afghanistan since 2008. 161:The Kabul Bank was established in 2004. 955: 953: 860: 858: 856: 822: 820: 818: 758:Rosenberg, Matthew (26 November 2012). 710: 332:International Security Assistance Force 269:for tax evasion allegations. Canada's 1830:Khoshal, Rahim Khan (21 August 2017). 924: 922: 920: 1206:Abi-Habib, Maria (28 December 2010). 1075:Spencer, Richard (8 September 2010). 7: 1299:Huffman, Michael (3 December 2011). 1284:Higgins, Andrew (22 February 2010). 1187:Filkins, Dexter (2 September 2010). 1094:Higgins, Andrew (22 February 2010). 787:Filkins, Dexter (2 September 2010). 101:. It was established in 2004 as the 1567:DeYoung, Karen (11 December 2012). 1288:– via www.washingtonpost.com. 1176:– via www.washingtonpost.com. 1022:Londono, Ernesto (2 October 2011). 991:Green, Matthew (18 February 2011). 960:Burch, Jonathon (2 February 2011). 896:Partlow, Joshua (1 February 2011). 429:, echoing calls made by a previous 1976:2011 establishments in Afghanistan 1966:2004 establishments in Afghanistan 349:2010 depositor panic and aftermath 25: 1941:Financial services in Afghanistan 1811:. Thomson Reuters. 29 August 2017 1778:Eltaf Najafizada (6 April 2016). 1752:Eltaf Najafizada (28 July 2016). 1706:"Kabul Bank gets Afghan bail-out" 1541:Standifer, Cid (9 January 2014). 1342:. 16 October 2011. Archived from 827:Ahmad, Sardar (19 October 2010). 807:Huffman, Michael (12 June 2012). 1715:– via www.telegraph.co.uk. 1704:Farmer, Ben (6 September 2010). 1365:Partlow, Joshua (30 June 2011). 1262:Gutcher, Lianne (19 July 2011). 1115:Imbert, Louise (November 2011). 726:– via www.theguardian.com. 664: 614: 36: 1884:Official New Kabul Bank website 865:Ellis, Eric (7 November 2010). 718:Boone, Jon (15 November 2011). 134:Afghanistan Ministry of Finance 1123:. Translated by George Miller. 646:The New Kabul Bank suffered a 458:Depositor losses from collapse 1: 1480:. Satrapia. 28 November 2012. 462:With regard to public sector 436:At the end of June 2011, the 1961:Organisations based in Kabul 1926:Controversies in Afghanistan 1741:– via www.reuters.com. 1522:. 2014-01-08. 8 January 2014 1137:Risen, James (3 June 2012). 809:"How They Robbed Kabul Bank" 323:, the provincial capital of 1478:The Gazette of Central Asia 431:International Monetary Fund 237:International Monetary Fund 126:Central Bank of Afghanistan 27:Private bank in Afghanistan 1997: 929:Shah, Amir (6 July 2011). 700:Transparency International 339:Transparency International 248:Bank run and panic in 2010 1936:Corruption in Afghanistan 1911:Banks established in 2011 1906:Banks established in 2004 1396:24 September 2015 at the 680:Corruption in Afghanistan 623:This article needs to be 562:corruption in Afghanistan 513:Monitoring and Evaluation 464:corruption in Afghanistan 343:corruption in Afghanistan 153:An advertisement for the 35: 1195:– via NYTimes.com. 1152:– via NYTimes.com. 773:– via NYTimes.com. 652:2021 fall of Afghanistan 267:Internal Revenue Service 122:automated teller machine 473:The Wall Street Journal 469:The New Yorker Magazine 402:southern Afghanistan's 315:2011 aftermath of panic 130:Da Afghanistan Bank−DAB 1411:"Too Corrupt to Fail?" 423:PricewaterhouseCoopers 158: 118:security police forces 1916:Banking controversies 1121:Le Monde Diplomatique 650:in the leadup to the 481:National Public Radio 152: 60:New Kabul Bank (2011) 1971:2010s in Afghanistan 1901:Banks of Afghanistan 523:(SIGAR) in 2013–14. 1573:The Washington Post 1213:Wall Street Journal 747:. 28 November 2012. 685:Da Afghanistan Bank 353:In early 2010, the 297:The Washington Post 32: 1931:Corporate scandals 1346:on 24 January 2013 1243:. 20 February 2011 1193:The New York Times 1143:The New York Times 841:on 25 January 2013 764:The New York Times 477:The New York Times 449:Enayatullah Nazari 301:The New York Times 215:The New York Times 196:Corruption scandal 159: 58:Kabul Bank (2004), 1861:www.aljazeera.com 1733:. 7 November 2015 1547:Stars and Stripes 745:Los Angeles Times 644: 643: 493:Ahmed Wali Karzai 209:Los Angeles Times 88: 87: 16:(Redirected from 1988: 1872: 1871: 1869: 1867: 1853: 1847: 1846: 1844: 1842: 1827: 1821: 1820: 1818: 1816: 1801: 1795: 1794: 1792: 1790: 1775: 1769: 1768: 1766: 1764: 1749: 1743: 1742: 1740: 1738: 1723: 1717: 1716: 1714: 1712: 1701: 1695: 1694: 1692: 1690: 1676: 1670: 1669: 1658: 1649: 1648: 1646: 1644: 1639:. 1 October 2014 1629: 1623: 1622: 1620: 1618: 1604: 1598: 1597: 1595: 1593: 1583: 1577: 1576: 1564: 1558: 1557: 1555: 1553: 1538: 1532: 1531: 1529: 1527: 1512: 1506: 1505: 1503: 1501: 1496: 1488: 1482: 1481: 1470: 1464: 1461: 1455: 1454: 1452: 1450: 1440: 1434: 1433: 1431: 1429: 1406: 1400: 1390: 1384: 1383: 1381: 1379: 1362: 1356: 1355: 1353: 1351: 1330: 1324: 1323: 1320:The Boston Globe 1311: 1305: 1304: 1296: 1290: 1289: 1281: 1275: 1274: 1259: 1253: 1252: 1250: 1248: 1231: 1225: 1224: 1222: 1220: 1203: 1197: 1196: 1184: 1178: 1177: 1169: 1163: 1160: 1154: 1153: 1151: 1149: 1134: 1125: 1124: 1112: 1106: 1105: 1099: 1091: 1085: 1084: 1072: 1066: 1065: 1063: 1061: 1047: 1041: 1040: 1038: 1036: 1019: 1010: 1009: 1007: 1005: 988: 979: 978: 976: 974: 957: 948: 947: 945: 943: 936:Associated Press 926: 915: 914: 912: 910: 893: 884: 883: 881: 879: 862: 851: 850: 848: 846: 837:. 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Index

Kabul Bank

Private bank
Kabul
Afghanistan
New Kabul Bank
Afghanistan
Kabul
private bank
army
security police forces
automated teller machine
Central Bank of Afghanistan
Afghanistan Ministry of Finance

afghani
U.S. dollars
euro
SWIFT
Iran
Tajikistan
Saudi Arabia
The Guardian
Los Angeles Times
The New York Times
Sherkhan Farnood
Mahmood Karzai
house arrest
International Monetary Fund
USAID

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