On Edge
Page 35
The Kabul Bank was established to provide a conduit to finance the war and to help rebuild Afghanistan’s infrastructure. When the bank was established, our government naively asked President Karzai which people might be best qualified to run the bank. Unsurprisingly, he named a number of his cronies, and unsurprisingly, two of them, Khalil Ferozi and Sherkhan Farnood, ended up in charge of the bank. Except for running a hawala in Moscow, which reportedly helped drug smugglers move money, Farnood had no previous financial experience. After teaming up, the two bank officials forged documents, created nonexistent firms, and ran an elaborate Ponzi scheme to not only funnel money to Afghan government officials but also to line their own pockets. One of Farnood’s early buying sprees involved spending millions of dollars on luxury villas in Palm Jumeirah, an expensive neighborhood in Dubai. So many of his colleagues did the same thing that it was the collapse of property values in Dubai in 2009 that sent the first signal that the Kabul Bank was in financial trouble.
There were sixteen shareholders in the bank, and they all received low-interest loans of millions of dollars. One of the shareholders was Mahmoud Karzai, the president’s brother. Another was Haseen Fahim, a brother of one of Afghanistan’s vice presidents. Mahmoud Karzai used some of the money he received to buy a six-million-dollar villa in Dubai.
In the course of the story, Alex becomes involved with some of the attempts to investigate the Kabul Bank’s failure and determine what happened to the nearly one billion dollars deposited in the bank. The Afghan government appointed a group called the Sensitive Investigative Unit to investigate what happened. Among their startling findings was the revelation that some of the bank’s money ended up in accounts controlled by the Taliban.
As Alex says in the story, “It looks as if our government is not only financing our war effort but that of our enemy as well.”
After it was revealed that the Kabul Bank was insolvent, President Karzai made no effort to investigate or to prosecute the perpetrators of the fraud, and that’s one reason why three years elapsed between the discovery of the missing money and the start of the trial. According to Dexter Filkins, writing in the New Yorker, the Kabul Bank contributed between seven million and fourteen million dollars to Karzai’s 2009 reelection campaign. That fact may explain why Karzai failed to act. But in time, Karzai may have realized that when his term as president expired in 2014, he might be succeeded by a chief executive who would be more amenable to America’s desire to punish those involved in the fraud. So he finally gave the green light for the trial of the bank officials.
Alex also has concerns about the Afghan court system. Since Afghan courts function differently from American courts and have often been susceptible to bribery, he wonders whether the judges will have the courage to find the twenty-two bank officials guilty.
In On Edge, the pieces in this complicated puzzle begin to fall into place, and it requires all of Alex’s determination and smarts to figure out what really happened in Afghanistan and who murdered his former buddy and why.
Whether what happens in this story could really have occurred—or did really occur—will be up to the reader to decide.