Wanna Smuggle Money out of Afghanistan?

Cash-counting machines in Kabul.

You may have heard that Afghanistan has something of a corruption problem, with billions of dollars flowing out of the country annually even as the US and international community pour money into reconstruction efforts. Instead of curbing the exodus of illicit cash, however, the Afghan government is apparently making it easier to smuggle money out of the country, according to a new report by the Special Inspector General for Afghanistan Reconstruction.

By designating certain officials “VIPs” or Very VIPs, the government is allowing certain individuals to bypass security at Kabul’s airport (and possibly sneak huge amounts of cash out of the country in the process). According to SIGAR, the Afghan government has even constructed a special VIP entryway that, in addition to circumventing security, also allows these individuals to forgoe the “bulk current counters.” These machines—which the US government purchased for $117,275—are supposed to record currency serial numbers and help law enforcement detect and investigate financial crimes. But, SIGAR found, they are not even being used correctly. Instead of tracking serial numbers, these machines were just being used to count the money. 

Among those who have faced allegations of money laundering are relatives of Afghan President Hamid Karzai. In 2010, a Western official accused Karzai’s late half-brother, Ahmed Wali, of laundering money for drug-runners, according to The New York Times. (Ahmed Wali, who had faced myriad charges of corruption, was killed in 2011 by a member of his security team.) Another of the president’s brothers, Mahmoud, has been linked to the Kabul bank scandal, in which $900 million in loans disappeared. (President Karzai himself stepped in to block US anti-laundering efforts in 2011 by banning US Treasury officials who were trying to protect Kabul Bank from fraud).

According to the Congressional Research Service, an estimated $4.5 billion was secreted out of Afghanistan in 2011; to put this in perspective, the country’s entire GDP was $20.34 billion that year. As SIGAR John F. Sopko noted in the report, proper controls “are particularly critical for a country fraught with corruption, narcotics trafficking, and insurgent activity.” That seems like an understatement. 


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