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Clifford Says He, Altman Have ‘Clear Consciences’

September 11, 1991

WASHINGTON (AP) _ Superlawyer Clark Clifford said today he and his law partner have ″clear consciences″ about their involvement with a Washington bank with ties to the scandal-plagued Bank of Credit and Commerce International.

″We have not been guilty of any misconduct, not even any impropriety,″ Clifford told the House Banking Committee.

″We have a formidable task in persuading many of you of our innocence in this,″ he told the members of the committee.

Just how formidable was evident moments earlier, when the panel’s chairman, Rep. Henry Gonzalez, D-Texas, opened the hearing by alleging that Clifford and his law partner, Robert Altman, used their knowledge of BCCI to profit in an ″inside game″ from stock deals and legal fees.

Clifford’s appearance was a sharp contrast to his customary role as adviser and strategist to Democratic presidents and witnesses under fire from congressional committees of the past. This time, the 84-year-old Clifford was under fire himself.

Clifford spoke at a packed hearing with Altman at his side at the witness table. Altman’s wife, former television ″Wonder Woman″ Lynda Carter, and Clifford’s wife, Margery sat directly behind them.

Clifford and Altman were chairman and president, respectively, of First American Bankshares Inc., which the government says was illegally acquired by BCCI in 1982.

″As the top officials in First American and as legal counsel for the bank, the Clifford-Altman team was in a unique position to know about BCCI’s involvement,″ Gonzalez said.

Referring to a deal in which Clifford and Altman allegedly bought stock with loans from BCCI and netted $9.8 million, Gonzalez said, ″These lucrative stock transactions were not the only insider game that profited these gentlemen. As soon as they assumed the executive chairs at ... First American, legal business started flowing from the bank to their Washington law firm.″

In a dramatic opening statement, Clifford repeated his assertion that First American operated independently of BCCI.

″At no time did BCCI exert any control whatsoever over First American,″ he said. ″You have my word for it. I give you my word under oath; at no time did we turn to them for decisions.″

Clifford said he became chairman of First American ″to test myself″ and that he didn’t need the money.

″Apparently, we were deceived,″ he said. ″My judgment is questionable; I guess I should have learned in some way.″

A statement submitted to the committee by Clifford and Altman said First American was ″honestly and capably run ... and that our own conduct was entirely proper.″

But Rep. Toby Roth, R-Wis., referring to the statement, said, ″I don’t believe a word of it.″

″I don’t believe you are an amiable dunce,″ Roth told Clifford, in a reference to a comment Clifford once made about Ronald Reagan.

Gonzalez said the banking committee is still trying to determine the exact amount of the legal fees, but he noted they may have exceeded the pair’s profit from the stock deal.

The banking committee is trying to find out what, if anything, Clifford and Altman, his law partner, knew about BCCI’s relationship with First American.

The lawmakers want to know whether Clifford and Altman misled federal regulators when they said in 1981 that BCCI wouldn’t have control of First American, a Washington-based bank holding company.

BCCI - founded by Pakistanis, owned by Persian Gulf investors and based in Luxembourg - is enmeshed in a mammoth banking scandal involving alleged massive fraud, laundering of drug money and support of terrorists.

Clifford resigned abruptly last month as chairman of First American. Altman, his 44-year-old protege, stepped down as its president.

Rep. Chalmers P. Wylie of Ohio, the Banking Committee’s ranking Republican, said documents obtained by the panel show that Clifford had extensive knowledge of BCCI’s interest in acquiring First American’s predecessor.

A report released by Wylie late Tuesday cited a 10-year-old telex message from a BCCI executive to the chief operating officer concerning BCCI’s interest in the purchase.

″I met Mr. Clark Clifford and explained to him our strategy and our goal,″ the report quoted the message as saying. ″He was happy to know the details and has blessed the acquisition.″

Clifford has denied that such a meeting took place, the report noted.

Clifford and Altman have repeatedly denied any wrongdoing and have said they were duped by BCCI executives. They said they were resigning to protect First American from the negative publicity surrounding BCCI.

Clifford and Altman were not charged in a New York grand jury’s indictment July 29 of BCCI, its Pakistani founder and its former chief operating officer. But prosecutors in New York and Washington are investigating whether the two misled Federal Reserve officials when they assured them that First American would operate independently of BCCI.

The two have been questioned this summer by Fed attorneys. But except for Aug. 13, when they quit First American, they have not made public statements. Their attorneys have declined comment.

A decade ago, the Fed approved the purchase of Financial General Bankshares, First American’s predecessor, by a group of Persian Gulf investors. Clifford and Altman vouched for the investors and assured the Fed that the Washington bank would operate independently of BCCI, which supposedly acted only as an ″investment adviser″ to the Arab group.

On July 29, the Fed announced it had uncovered evidence that the Arab investors acted as fronts for BCCI in its illegal takeover of Financial General. The central bank said it was seeking to fine BCCI a record $200 million.

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