A recent assessment funded by the US Agency for International Development has raised concerns about the independence of Afghanistan’s central bank, Da Afghanistan Bank (DAB), from the Taliban administration. This report, presented to the US Congress by the US Special Inspector General for Afghanistan Reconstruction (SIGAR), also highlighted deficiencies in the bank’s anti-money laundering and counter-terrorism financing measures.
The SIGAR’s quarterly report to Congress revealed that DAB’s operations are influenced by the Taliban regime, particularly pointing to the involvement of three Taliban officials overseeing the bank, who are under sanctions by the US and UN. This lack of independence has been a central issue since the Taliban’s return to power following the US troop withdrawal in August 2021.
A key focus of international concern involves the DAB’s leadership and its capacity to implement effective safeguards against money laundering and the financing of terrorism. This issue forms part of the ongoing standoff over the Taliban’s demand for the return of DAB’s assets, which have been frozen in various countries since their takeover.
Approximately $7 billion of DAB’s assets frozen in the US Federal Reserve Bank of New York have been a subject of contention. Half of this amount has been transferred to a Swiss-based trust fund, while the remaining funds are being claimed through lawsuits brought against the Taliban by families of the September 11, 2001, attack victims. The Taliban had provided shelter to al-Qaeda operatives responsible for the attacks.
An anonymous US Treasury official indicated to Reuters that the US would not support the transfer of assets from the Swiss-based trust fund back to DAB until the bank can demonstrate autonomy from political influences and interference. Additionally, the bank must establish adequate controls to prevent money laundering and terrorism financing. This stance underscores the ongoing international scrutiny over Afghanistan’s central banking system and its compliance with global financial standards.
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