Kabul Politics Block Bank Probe, Panel Finds

Political interference has impeded an investigation into the collapse of Afghanistan's largest private lender, with some investors, including President Hamid Karzai's brother Mahmood, escaping scrutiny, a joint Afghan-international watchdog said in a report released Wednesday, The Wall Street Journal reported. The Afghan Attorney General's investigation into Kabul Bank's 2010 collapse has led to the prosecution of several bank executives, who have been on trial in the Afghan capital for about a month. But the investigation is sparing shareholders with strong political connections, according to the report by the Independent Joint Anti-Corruption Monitoring and Evaluation Committee, which comprises three Afghan anticorruption experts named by Mr. Karzai and three international representatives. Mr. Karzai's spokesman, Aimal Faizi, rejected the report's conclusions. "The Afghan government has opened all channels of investigation in regard to Kabul Bank," he said. "And we find these allegations of political interference baseless." The Attorney General's office declined to comment. When Kabul Bank was taken over by the Afghan government in 2010, about 92% of its loan book, or $861 million, had been disbursed to 19 related parties, such as business offshoots and its executives and shareholders, including Mahmood Karzai and Haseen Fahim, the brother of the country's vice president, according to the MEC report. Read more. (Subscription required.)