Officials Seek Tougher Sentences in Kabul Bank Case

The special court handed down sentences ranging from six months to several years and, in some instances, hundreds of millions of dollars in fines, to the 21 defendants in the largest financial fraud case in Afghan history. But in delivering their verdicts, the judges altered the charges, making them more lenient than the ones in the original indictment. Further, given the nature of the new charges, it was unclear how easy it would be to enforce the sentences and fines that were given.

“We want heavier punishment and long-term imprisonment for all the culprits,” said Sayed Alam Ishaqzai, the director of the anticorruption department of the attorney general. “It’s not in accordance with our indictment. There is no balance between the crime and punishment.”

Last week’s ruling was widely seen as relatively lenient on the two principal figures in the bank’s corruption, Sherkhan Farnood, the bank’s founder, and Khalilullah Frozi, its chief executive. The men each received five-year prison sentences and were fined hundreds of millions of dollars, but it was unclear whether the fines, in particular, could be enforced because there were no confiscation orders issued with them.

The men presided over a campaign of fraudulent loans and kickbacks that siphoned nearly $900 million from depositors until Kabul Bank was pushed to near collapse in 2010. One investigative report likened the bank’s operations to a Ponzi scheme, and long delays in bringing the principals to justice were widely criticized by the Afghan public and Western officials.

In its appeal, the attorney general’s office can seek to reinstate the initial charges, including embezzlement and money laundering, paving the way for considerably harsher sentences. And the money laundering law allows the court to confiscate assets and accounts to recover the losses the bank sustained, money that the Western-funded Afghan government had to cover.

The attorney general’s office also plans to appeal the sentences of the other 19 people convicted. Those defendants were given sentences ranging from 6 to 30 months in prison.

But while the action by the prosecutors is likely to be seen as a step in the direction of legal accountability, there have been grave concerns about the inclusion of some of the defendants on the indictment list. Among those who might face tougher sentences would be a handful of former regulators who worked to repair the damage at Kabul Bank. Their inclusion in the indictment and convictions was widely seen as a retaliatory move by senior Afghan officials.

Sangar Rahimi contributed reporting.

Article source: http://www.nytimes.com/2013/03/14/world/asia/officials-seek-tougher-sentences-in-kabul-bank-case.html?partner=rss&emc=rss