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Kabul Bank fraud: Sherkhan Farnood and Khalilullah Ferozi jailed | Kabul Bank fraud: Sherkhan Farnood and Khalilullah Ferozi jailed |
(35 minutes later) | |
Two former chiefs of Afghanistan's Kabul Bank have been sentenced to five years in jail for the multi-million dollar fraud that almost led to its collapse in 2010. | Two former chiefs of Afghanistan's Kabul Bank have been sentenced to five years in jail for the multi-million dollar fraud that almost led to its collapse in 2010. |
Founder and former chairman Sherkhan Farnood and ex-CEO Khalilullah Ferozi were tried in a special court. | Founder and former chairman Sherkhan Farnood and ex-CEO Khalilullah Ferozi were tried in a special court. |
Revelations of massive corruption led to a run on the bank in 2010. | Revelations of massive corruption led to a run on the bank in 2010. |
Foreign donors bailed it out fearing its failure could lead to the collapse of Afghanistan's fragile economy. | Foreign donors bailed it out fearing its failure could lead to the collapse of Afghanistan's fragile economy. |
The country's future aid contributions could have been jeopardised if no action had been taken against those responsible for the fraud, reports the BBC's Quentin Sommerville in Kabul. | |
Farnood has been fined $288m (£190m) and Ferozi $530m (£350m) by the Kabul Bank Special Tribunal. More than 20 other employees were also being tried. | |
The bank handled most of the government payroll, including salaries for policemen and teachers. | The bank handled most of the government payroll, including salaries for policemen and teachers. |
But in fact this was a sham, reports our correspondent, as its main purpose appears to have been to ferry hundreds of millions of dollars out of Afghanistan. | |
A report by an independent auditor leaked in November 2012 showed that the vast majority of the bank's loans - almost $900m (£561m) - were made to just 19 people and companies. | A report by an independent auditor leaked in November 2012 showed that the vast majority of the bank's loans - almost $900m (£561m) - were made to just 19 people and companies. |
An earlier finding by Afghanistan's anti-corruption office said that $467m (£290m) of outstanding loans had been made without appropriate collateral. | |
Our correspondent says that much of the stolen money is unlikely to be recovered. | |
The two men have the right to appeal, reports the Associated Press news agency. | The two men have the right to appeal, reports the Associated Press news agency. |