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Kabul Bank scandal: Court triples jail sentences

Kabul Bank scandal: Court triples jail sentences

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Nov 12, 2014 - 02:22

KABULinfo-icon (Pajhwok): The court of appeal on Tuesday tripled the jail sentences of two former Kabul Bank heads to 10 years at the end of a re-opened case into the bank's collapse, ordering assets of Mahmoud Karzai to be frozen.

Mahmoud Karzai, a brother of former president Hamid Karzai, was stakeholder of the bank that plunged into a deep financial crisis due to a run on the bank in 2010.

Mahmoud Karzai has so far been spared jail but the judge on Tuesday ordered that his assets be frozen, along with those of others, until all the funds stolen from the bank have been returned.

They face prosecution if the funds are not repaid. Only about a third of the $935 million stolen has been recovered.

The two former heads, founder Sher Khan Fernood and former Chief Executive Khalil Ferozi, had been convicted in the initial inquiry of taking $810 million of the stolen money and were both sentenced to jail for five years. Their jail terms were tripled on Tuesday.

Both men are expected to appeal again. The court also ordered the assets of Haseen Fahim, brother of a former vice-president, to be frozen until they repay their debts. Mahmoud and Fahim have been spared prosecution under a presidential decree issued by Hamid Karzai granting them immunity.

Tuesday's sentences come after the new President, Ashraf Ghani, ordered an inquiry into the fraud to be reopened.

Judge Mehrajuddin Hamidi, however, said they could appeal against the verdict.  On Tuesday, Karzai said the court's verdict would not affect him as he did not owe any money.

"I don't owe them any money, so it's irrelevant. In fact, I made an overpayment (and) I am going to serve the Attorney General's office tomorrow with orders to refund me the $450,000 I overpaid," Karzai told a foreign news agency.

The government bailed out the bank with $825 million, and brought in receivers who have traced most of the missing funds.

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