International Bank Named Latin Drug Money Conduit : L.A. Officer Among 81 Charged

U.S. prosecutors today charged a major international bank and 81 individuals with taking part in a global operation that laundered more than $32 million for the Colombian cocaine trade.

Law enforcement officials in half a dozen U.S. cities, London and Paris were rounding up suspects and searching the offices of the Bank of Credit and Commerce International, a Luxembourg-based institution named in federal grand jury indictments handed down in Tampa.

“It is the first time an entire international financial institution and its important members have been indicted” in a money laundering case, U.S. Customs Service Commissioner William von Raab told reporters at a news conference.

‘Most Important’ Case

Von Raab described the indictment as the “most important money laundering case in U.S. customs history.”

Prosecutors said the ring laundered drug profits for Colombia’s Medellin Cartel, believed responsible for up to 80% of the cocaine shipped into the United States.

A U.S. law enforcement official, speaking on condition of anonymity, said associates of Panamanian ruler Gen. Manuel A. Noriega were believed to have used the bank’s Panama City branch in the past to launder proceeds from his alleged drug smuggling network.

But Noriega, who was indicted by grand juries in Miami and Tampa last February, was not mentioned in the latest indictment.

Among those named were eight top managers of the bank, which operates branches in 72 countries and was described by prosecutors as the seventh largest privately held financial institution in the world.

London Company Charged

Capcom Financial Services Ltd., a London-based company, was also charged in the indictment, and one of its officers was arrested in Britain, officials said.

Federal prosecutors said they were seizing up to 40 bank accounts from the Bank of Credit and Commerce International and had obtained a restraining order preventing the removal of any of its assets from the United States.

The bank, in a statement issued in London, said it was a victim of “a malicious campaign” to discredit it but had faith it would be vindicated in the U.S. courts.

The indictments stemmed from a two-year investigation in which U.S. undercover agents penetrated the money laundering operation, customs officials said.

39 Suspects Arrested

Officials said 39 suspects were arrested over the weekend in the United States, Britain and France--including Iqbal Ashraf, manager of the bank’s Los Angeles office.

Nine people, including several former and present employees of the bank, were taken into custody in Tampa after they were lured to a fake wedding by an undercover agent posing as a money launderer, officials said.

The Bank of Credit and Commerce International was founded in the early 1970s by a Middle Eastern consortium and is primarily involved in financing international business deals and providing letters of credit. The bank operates nine offices in the United States.

Customs officials said undercover agents pretended to set up their own money laundering operation and were approached by members of the alleged ring who offered their services.

Agents said proceeds from the U.S. drug sales were funneled from Tampa through banks in other U.S. cities and then returned to Tampa in the form of fake loans. The money was then transferred through Uruguay before being passed on to drug barons in Colombia, agents said.