Kabulbank directors were paid $500K bonuses – audit

Afghanistan's ailing Kabulbank paid its top two directors and shareholders, currently under investigation for banking fraud, $500,000 each in bonuses in 2009, according to an independent audit earlier this year.
Afghanistan's Central Bank said it had taken over the country's top private bank because of suspected irregularities and began investigations into former chairman Sherkhan Farnood and former chief executive Khalilullah Fruzi.
Kabulbank's troubles have threatened to add a financial crisis to Afghanistan's other woes, with military and civilian casualties at record levels as a Taliban-led insurgency grows. Parliamentary elections will be held on Saturday.
Fears over the bank resulted in a run this month as many of the bank's jittery customers rushed to withdraw savings even though the government and the central bank assured them their money was safe.
The audit, by the Pakistan-based accountancy firm A.F. Ferguson & Co, a member company of PricewaterhouseCoopers, showed that Farnood and Fruzi were the only two directors to receive bonuses.
The Kabulbank case has raised questions about the handling of funds from Western donor countries, channelled through a nascent commercial banking sector that the United States has encouraged Afghanistan to build.