May 19, 2011 — Dean Henderson
This week’s arrest of IMF Managing Director Dominique Strauss-Kahn – whether a Sarkozy-instigated “honey-trap” or just good law enforcement – should come as no surprise. Since its inception, the IMF has violently abused the people of the developing world in its role as debt collector for the Eight Families Rothschild-led banking monopoly.
The banksters sink poor countries into debt via loans that benefit either their wholly-owned multinational corporations or well-placed domestic strawmen. The IMF then swoops in and orders the now-indebted country to privatize its economy – with the banker-owned multinationals picking up state assets for pennies on the dollar as part of “debt reorganization”. One of the Eight Families’ tentacles facilitates this kabuki dance for a healthy fee. More often than not it is Goldman Sachs.
Another part of the deal is to impose harsh austerity measures that hit the poorest people the hardest. These measures include raising electricity rates, imposing a value-added tax or ending government subsidies for basic foodstuffs such as rice and beans.
If the country in question follows IMF mandates it receives yet more misdirected “loans” from the World Bank crowd and sinks further into debt. If it does not, the country is cut off from international finance, its currency devalued and its economy ravaged by hyperinflation. Countries that can no longer repay their mounting debt become victims of even worse IMF abuse, including the outright theft of that country’s Treasury funds.
No case illustrates this type of IMF official mugging better than that of the mysterious Bank of Credit & Commerce International (BCCI).
Robin Hood in Reverse
Both the IMF and the Caribbean Development Bank (CDB) had close ties to BCCI. The CDB was founded by David Rockefeller’s International Basic Economy Corporation – which launched the Caribbean Basin Initiative. CDB loans money to countries that agree to allow multinational corporations to set up tax-free operations within their borders to take advantage of cheap labor. These areas become known as export processing zones and give the corporations additional tax benefits from the US government.
BCCI – launched by Bank of America – was a CIA drug money laundry which moonlighted as mugger for the IMF bankers. The IMF helped BCCI set up shop in numerous countries, including virtually every Latin American nation. BCCI loaned the Jamaican government money to pay the IMF in return for Jamaican government deposits at BCCI. Bolivia got BCCI loans under the same agreement, this time at the urging of the World Bank. In Peru, the IMF/World Bank solicited Peruvian treasury deposits for BCCI.
None of these countries would ever see the over $1 billion in treasury funds which they collectively put down the BCCI black hole. Peru later indicted a former IMF/World bank official for his role in the fleecing of Peru’s Central Bank. While recycled petrodollars were being pumped into BCCI from the pockets of Gulf Cooperation Council (GCC) oil sheiks, and drug profits were derived from contra cocaine and mujahadeen heroin, BCCI was simultaneously swindling the central banks of some of the world’s poorest countries with a wink and a nod from the IMF and World Bank.
As Alexander Cockburn put it in a Wall Street Journal column, when BCCI was closed by the Bank of England in July 1991, “The little guys went to the wall and the big fish swam off with the swag”.
The racket worked something like this: BCCI, in addition to providing loans for deposits, would offer to broker a country’s debt with the IMF if the central bank was willing to deposit funds at BCCI’s local branch. Those countries that cooperated with the IMF would be rewarded with more loans. Those that refused never saw their money again. Most of the $20 billion that disappeared when BCCI was shut down belonged to Third World central banks whose governments had not bent over far enough for the IMF. This outright theft left the poorest, most debt-ridden countries in the world even more impoverished. African nations were hardest hit.
Cameroon, where US AID had been BCCI’s biggest customer, lost one-third of its hard currency reserves. Nigeria lost $300 million when BCCI crony Alhaji Ibrahim Dasuki bribed central bankers, then split with the cash. For his troubles he was appointed Sultan of Sokoto, the Muslim capital of northern Nigeria. The central banks of Zambia, Zimbabwe, Congo, Ivory Coast, Sierre Leone, Gabon, Senegal and Ghana were all pilfered by BCCI. All failed to satisfy IMF mandates for new loans or were in arrears on old debt. BCCI sponged over $2 billion from the African continent.
Even in England, where $400 million was lost by depositors when BCCI closed shop, most of the money belonged to African immigrants of marginal means who believed BCCI’s claim of being “a bank for the world’s poor”.
In Peru, populist President Alan Garcia, who in 2001 launched a stunning political comeback and nearly defeated former World Bank economist Alejandro Toledo in the Peruvian Presidential elections, suspended debt payments to the international banks in 1986. Within months he was approached by Amjad Awan, Panamanian President Manuel Noriega’s personal banker who ran the BCCI Panama City branch through which Noriega received his $200,000/year CIA paycheck.
Awan suggested that Garcia use BCCI to hide what little hard currency Peru had stashed away from the IMF debt collectors. Awan arranged bribes of over $3 million to be paid to Peruvian Central Bank officials through Security Pacific Bank and Swiss Bank Corporation of Panama. The officials wired $250 million, 25% of all Peruvian Central Bank assets, to BCCI Panama. Peru never saw the money again.
In Argentina, BCCI paid off officials to pull off a debt-equity swap so ludicrous that it involved BCCI buying Argentine debt for pennies on the dollar, then selling it back to Argentina for full price. This happened under President Carlos Menem, the Bush-family friend who was brought down by a drugs and corruption scandal of which these phony debt-equity swaps were a part. A big chunk of the $132 billion that Argentina “owed” the international bankers when it defaulted in late 2001 went down the BCCI rabbit hole.
BCCI specialized in facilitating capital flight from poor countries by helping rich Third World nationals start offshore accounts with the bank. BCCI would hire siblings of wealthy clients to man its local branches. In Bangladesh it helped deposed President Ershad loot the Bangladesh Central Bank on his way out of the country. The Dacca BCCI branch was manned by Ershad’s relatives, who set up a foundation to avoid taxes while receiving BCCI kickbacks. Aid received by BCCI-Dacca was diverted into offshore accounts of the Ershad family which BCCI helped set up. When BCCI went under in 1991, 15,000 middle-class Bangladeshis lost their life savings.
Manuel Noriega did the exact same thing with BCCI-Panama, with many Panamanians losing their nest eggs as well. In country after country BCCI aided a tiny group of elite IMF-connected families in robbing their nation’s treasuries, then moving the money offshore into accounts at Western mega-banks. The global elite had once again shaken down the world’s poor.
As Manuel Salgado Tamayo, Ecuador’s former Vice President of the National Congress and once a candidate for President, put it, “…a world order…for the first time in the history of capitalism has the world’s population by the scruff of the neck. This order, or world disorder, is neo-liberal globalization, whose postmodern philosophy expounds the death of reason and humanism, the total imposition of capital over labor, a ‘free’ market for the South vs. protectionism for the North, and a type of financial freedom that allows the rich to steal the savings of the poor.”
Strauss-Kahn is proof positive that scum really does rise to the top. Now that he’s in jail where he belongs, the US should pull its funding of the IMF and end this tax-payer subsidy of inbred banker brutality.
4 Responses to “Strauss-Kahn & The IMF/BCCI Mugger”
Bruce E. Woych Says: May 19, 2011 at 3:35 pm
This global pattern has been happening for three plus decades now and up until now it has primarily been the most vulnerable third world that has been looted Texas style and plundered with abandon by the seizures and takeover going under the banner of “free markets” privatization and crony political capitalism. Without getting deeper into this hell hole of unfettered “realism” it is critical to re-evaluate the crisis and looting of our own treasury by a very small gang ruling the power finance of Wall Street:; and recognize that the Friedman/Chicago University (gangster style) crash, burn and blame the victims while you plunder them…is HAPPENING TO OUR OWN DOMESTIC ECON0OMY RIGHT NOW.
THINK ABOUT THE PATTERN AND APPLY IT TO EVERYTHING THAT HAS HAPPENED IN AMERICA (it easily goes back to BCCI but remember that Texas Looting was happening prior to and including the so called Savings and Loan swindles. It is the same pattern! They police themselves so there is no way to catch them or even follow all the money.
WAKE UP AMERICA: YOU ARE NOT ONLY BEING CRASHED AND BURNED BUT TAKEN OVER AND COLONIZED!
Bruce E. Woych Says: May 19, 2011 at 5:12 pm
This systemic corruption of power derives from the cold war policies which began declaring a competitive “economic” war against the presumptive spread of communism and the red scare mentality. Once paramilitary operations went covert and a neo-military community (Eisenhower’s Military Industrial Complex or MIC) benefited it spiraled progressively and incestuously. Multiple Coup D’Etats and rank and file operatives could be financed off shore and by utilizing organized crime which could also facilitate operations without the overt approval or even knolwledge of Congress. Need to know and deniability festered and fostered greater levels of power corruptions and red scare ideology precluded nothing as being possible (JFK)>
Black Market finance and Cartel Crime was just the shadow side of political estate building within regimes and iits massive financing. The vast amounts of financing and off shore systems of financing these operations grew to be international (Iran – Contra) and internally contradictory. The rest is history as the managerial finacial structures of globalization systemics were embedded with its corrupt process and even unwittingly could take advantage of it.
Today we see the results both economically and politically.
It is impossible to get to the bottom or the top of this thing: it is totally out of control and our government as well as our domestic economy has been deeply infested and infected by the systemics of these cold war “derivatives.”
Marahiah Says: May 19, 2011 at 7:05 pm
Deluxe research and details.
-disturbing that the most viscous of Predators ruthlessly prevail.
-disturbing to know the view from the top is littered with victims of pain, death and destruction.
and Strauss-Kahn proves that the IMF also eats their own.
Belo Ghacom Says: June 10, 2011 at 10:31 am
Well,when they were decimating the Third World, Westerners were enjoying their enabled welfare and raised no finger of protest for the multiple mass rape of the poor. When foreign shores are depleted the chickens will come home to roost long before you know it or can do anything about it!
About the author:
Dean Henderson was born in Faulkton, South Dakota. He earned an M.S. in Environmental Studies from the University of Montana, where he edited The Missoula Paper and was a columnist for the Montana Kaimin. His articles have appeared in Multinational Monitor, In These Times, Paranoia and several other magazines.
A life long political activist and traveler to fifty countries, Henderson co-founded of the University of Montana Green Party and the Ozark Heritage Region Peace and Justice Network. He is former Vice-President of the Central Ozarks Farmer’s Union and former President of the Howell County Democrats.
In 2004 he won the Democratic nomination for Congress in Missouri’s 8th District.
Dean’s Books Available in print and e-book formats:
Big Oil & Their Bankers in the Persian Gulf…
The Grateful Unrich: Revolution in 50 Countries
Dean Henderson is the author of Big Oil & Their Bankers in the Persian Gulf: Four Horsemen, Eight Families & Their Global Intelligence, Narcotics & Terror Network and The Grateful Unrich: Revolution in 50 Countries.
His Left Hook blog is at http://deanhenderson.wordpress.com/category/left-hook-columns/
Dean Henderson is a frequent contributor to Global Research. Global Research Articles by Dean Henderson: http://www.globalresearch.ca/index.php?context=listByAuthor&authorFirst=Dean&authorName=Henderson