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Accountant Sentenced in BCCI-Related Coffee Case

January 9, 1993

MIAMI (AP) _ An accountant convicted of tax fraud in a coffee-smuggling scheme linked to the Bank of Credit and Commerce International was sentenced Friday to 27 months in prison.

Kenneth Grushoff, 47, worked for fugitive Jordanian coffee trader Munther Bilbeisi, who was indicted in the same 1991 case.

Prosecutors said Bilbeisi’s Coffee Inc. used false papers provided by BCCI to smuggle cheap coffee into the United States and resell it at higher prices.

Grushoff was convicted Oct. 28 on five counts of falsifying his and Bilbeisi’s tax returns to hide profits from the scheme in 1985 and 1986. He faced a maximum 21-year sentence.

U.S. District Judge Shelby Highsmith, pointing to a history of drug and alcohol abuse, instead sentenced the accountant to 27 months, and told him to avoid intoxicants when he finishes his sentence.

″Make something of your life,″ the judge said.

Grushoff’s attorney Peter Aiken had argued that others involved in BCCI- related schemes received even lighter sentences.

But federal prosecutor Andres Riveiro responded that those defendants had cooperated with the United States, helping to recover $500 million from BCCI.

The judge said Grushoff can remain free on $100,000 bond for up to 60 days so he can complete tax forms for his 400 remaining clients.

Bilbeisi fled to Amman, Jordan amid a flurry of civil and criminal investigations, and has refused to return. The United States has no extradition treaty with that country.

International bank regulators seized BCCI in July 1991 following evidence of widespread fraud, corruption and illegal insider loans. Later reports subsequently linked the Third World bank to schemes to bribe central bankers in Africa and arms smuggling in Central America.

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