BCCI Bank Shut Down After Exposing CIA Drug Money Laundering Network

Customs and bank regulators in seven countries simultaneously raid and shut down the Bank of Credit and Commerce International (BCCI), exposing what becomes known as the largest corporate criminal enterprise in history. The shutdown follows a Price Waterhouse investigation ordered by the Bank of England in March 1991, which finds “evidence of massive and widespread fraud” in the $20 billion rogue banking empire with liabilities of $14 billion.

BCCI served as a global money-laundering operation for dictators, drug cartels, arms dealers, and intelligence agencies, earning the nickname “Bank of Crooks and Criminals International” from law enforcement. The bank’s client list includes Manuel Noriega, Ferdinand Marcos, Saddam Hussein, and Colombian drug barons. The CIA held “several” accounts at BCCI, and the National Security Council maintained accounts used for covert operations, including transfers during the Iran-Contra affair.

Former bank officials testify that BCCI financed the Reagan administration’s secret arms sales to Iran. FBI investigators requested bank records about the arms deals in 1987, with documents showing Reagan administration operatives paid a BCCI Monte Carlo office manager $100,000 to arrange a $10 million loan for weapon purchases executed by arms dealer Adnan Khashoggi. The CIA admitted in August 1991 that it used BCCI “as a way to move money” for covert operations.

BCCI’s Pakistan operations served as a major channel for drug money laundered by corrupt Pakistani military officers who administered the CIA’s arms pipeline to Afghan mujahedin rebels while simultaneously supplying much of the heroin that flooded the U.S. and Europe during the 1980s. The scandal exposes the dark nexus between intelligence agencies, drug trafficking, arms dealing, and money laundering that characterized covert Cold War operations, revealing how the CIA prioritized anti-communist objectives over preventing drug trafficking and enforcing financial regulations.