Clifford, Altman Stock Gain On BCCI Put at $33 Million
WASHINGTON - Bank of Credit and Commerce International's high-profile attorneys, Clark M. Clifford and Robert A. Altman, may have made as much as $33.3 million in profits in recent years by buying and selling stock in First American Bankshares.
So said Sen. Jesse Helms, R.N.C., whose staff has determined that the lawyers bought 8,168 First American shares in 1986 and 1987 at $2,204 each, then sold 4,800 shares to BCCI 18 months later for $6,800 per share.
What's more, Sen. Helms said, the two lawyers bought the shares with funds borrowed from BCCI. The senator said he based his conclusions on press reports and public documents.
Stock-Trading Data Sought
Sen. Helms, a member of the Senate subcommittee on terrorism, narcotics and international operations, made his statement during the first of several hearings on the BCCI scandal. He wants the two prominent lawyers to detail their stock transactions when they appear before the committee next month.
BCCI, based in Luxembourg, failed July 5 after being shut down by regulators in many of the 69 countries where it had operated. BCCI, with about $20 billion in assets, has been accused of having ties to terrorists, financing illegal drug trade, and backing gun-running operations.
In addition, the Fed this week announced that it is seeking $200 million in civil money penalties from the Luxembourg-based bank for allegedly obtaining stock positions in secret in both First American and Centrust Savings Bank, a Florida thrift.
Mr. Clifford and Mr. Altman, directors of First American, claimed they were duped and had no idea BCCI had gained control of the bank.
Key Auditor's Report
Yet a BCCI auditor's report obtained late last year "provided the Federal Reserve with substantive evidence of a BCCI-First American link, and the board thereupon ordered the formal investigation," said Fed General Counsel Virgil Mattingly at the BCCI hearing.
For the first time, Mr. Mattingly publicly gave a behind-the-scenes account of what took place just days before the July 5 seizure. June 28, the Fed dispatched senior officials of the Federal Reserve Bank of New York and the Fed's Board of Governors in Washington to London to coordinate efforts to seize the bank.
Mr. Mattingly said several factors relating to BCCI troubled Fed officials:
* A large portion of BCCI's global activities were conducted in U.S. dollars.
* Fallout from BCCI's problems threatened to disrupt interbank markets, payment flows, and foreign exchange transactions, thereby affecting U.S. markets.
* Banks based in the Persian Gulf region with major operations in New York might have been hurt.
Meanwhile, William Von Raab, former head of the U.S. Customs Service, testified Thursday that BCCI ran a "gray network" of highly paid lawyers and public relations men to bully officials at the Justice Department and other agencies who were pursuing BCCI.
Mr. Von Raab said BCCI hired "blue-chip" lawyers, namely Mr. Clifford and Mr. Altman, who he suggested were "working this case for all it was worth."
"Whatever the Washington brokers got for their involvement in protecting BCCI against the federal government, they earned every million dollars that they received," he said.
Mr. Clifford and Mr. Altman could not be reached for comment.
