Afghan President: Kabul Bank's Foreign Consultants Should Face Prosecution

Afghan President Hamid Karzai takes the stage at the National Military Academy of Afghanistan's graduation rites on March 22, 2011. Karzai has ordered an investigation into alleged corruption in the troubled Kabul Bank. Photo by: International Security Assistance Force

Afghan President Hamid Karzai has ordered the Afghan attorney general’s office to investigate alleged corruption in the troubled and soon-to-be-dissolved Kabul Bank.

The bank’s liquidation, which begins this month, fulfills a requirement by the International Monetary Fund for the renewal of Afghan assistance.

>> Afghanistan to Liquidate Kabul Bank

“All wrongdoers, whoever has violated the law, will be dealt with legally,” Karzai said in a news conference on Monday (April 11), ordering prosecutions to begin. 

Karzai blamed “foreign experts” who he said were “hired with high pay to smooth operations at the bank, were hired to help, but they worsened the system,” particularly PricewaterhouseCoopers, whose Pakistani subsidiary A. F. Ferguson & Co. audited Kabul Bank’s accounts. 

Karzai warned that international consultants with the bank who would be found connected to any illegalities will be prosecuted. 

PricewaterhouseCoopers declined to comment on Karzai’s remarks. A.F. Ferguson has in the past denied the allegation, The Wall Street Journal reports. 

The U.S. Agency for International Development has canceled a contract with Deloitte in Afghanistan for failing to inform the agency about early signs of widespread corruption at Kabul Bank.

USAID engaged Deloitte in August 2009 to advise executives at the Afghan Central Bank, which sets monetary policy and regulates all private banks, including Kabul Bank.

>> In Afghanistan, USAID Terminates Deloitte Contract Over Kabul Bank Scandal

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About the author

  • Ma. Rizza Leonzon

    As a former staff writer, Rizza focused mainly on business coverage, including key donors such as the Asian Development Bank and AusAID.