Accessibility links

Breaking News

Senior Officials Of Collapsed Afghan Bank Sentenced

Former Chairman of the Kabul Bank, Sherkhan Farnood (R) and former Chief Executive Officer Khalilullah Ferozi walk past each other at a court in Kabul. (file photo)

An appeals court has lengthened the prison sentences of two former senior officials of Kabul Bank, which was Afghanistan's largest private bank before it collapsed in 2010 with almost $1 billion in debt.

The officials -- Kabul Bank's founding chairman, Sher Khan Farnood, and its former chief executive, Khalil Ferozi -- were sentenced on live television to 15 years in prison each for embezzlement and fraud.

Farnood was also fined $237 million, while Ferozi was fined $137 million.

Farnood and Ferozi had initially been sentenced to five years in prison.

But the procedure came under heavy criticism, and new President Ashraf Ghani ordered the reopening of the case after taking office in September.

Ferozi told reporters after the verdict was announced that the decision was "unjust" and accused Ghani and his team of involvement.

"It was an artificial verdict, dictated by the president. We do not accept it and will appeal," said Ferozi.

The court also ordered that the property of two powerful shareholders -- Mahmood Karzai, the brother of former president Hamid Karzai, and Hasin Fahim, the brother of former vice president Qasim Fahim -- be confiscated by the state.

Kabul Bank collapsed in 2010 after media reports exposed the misappropriation of more than $900 million, which at the time represented some 5 percent percent of Afghanistan's economy and 34 percent of total banking transactions.

The government bailed out the bank and officials say they have recovered one-third of the money in cash and in assets, and traced most of the missing funds.

Based on reporting by AP and dpa