Ex-Agent Says Delays Hurt BCCI Inquiry : Banking: Former undercover officer tells senators hundreds of leads were not pursued because of thin resources.

The undercover agent who broke the case against the Bank of Credit & Commerce International said Thursday that hundreds of leads indicating wrongdoing by the bank were not pursued because of a lack of resources.

Testifying from behind a frosted-glass screen to conceal his face, federal agent Robert Mazur told a Senate subcommittee that the delay in aggressively investigating the evidence left him frustrated and contributed to his decision to quit the U.S. Customs Service last April.

“We were a reconnaissance squad sent out into the desert that contacted the enemy and sent word for help and waited and fought and fought, but no help came,” said Mazur, his voice transformed into a Darth Vader-like growl by a modulator to ensure anonymity for his new job as an undercover agent for the Drug Enforcement Administration.

Mazur’s dramatic testimony, his first public discussion of the BCCI investigation, provided a rare and detailed look inside the two-year undercover inquiry that led to the 1988 indictment of BCCI on money-laundering charges in Tampa, Fla.

But it was Mazur’s statement that there were delays in pursuing still-unproven allegations about BCCI’s involvement in political payoffs, its role in financing arms transactions and its secret ownership of U.S. banks that typified the criticism of the way the investigation was handled by the Justice Department and Customs Service.

Mazur’s complaints were directed largely at Customs and he praised the prosecutors who worked with him. But Sen. John Kerry (D-Mass.) saw Mazur’s charges as an illustration of Kerry’s central thesis--that the government was slow to go after BCCI because it took too narrow a view of its criminal investigation of BCCI.

“It wasn’t a money-laundering case,” said Kerry who, as chairman of the Senate Foreign Relations subcommittee on terrorism, narcotics and international operations, has been investigating BCCI for three years. “That’s the problem. It was much bigger than that.”

Justice Department officials, including Asst. Atty. Gen. Robert S. Mueller III and Mark V. Jackowski, the lead prosecutor in the first BCCI case, defended their actions in equally strong language.

“It is unrealistic to expect overnight results if we are to maintain professional standards,” said Mueller, who is overseeing an expanding Justice Department investigation of the bank’s activities.

Sometimes the exchanges were heated. At one point, Jackowski was explaining that the prosecutors’ intent all along was to convict the bank and its employees in the money-laundering case and then move forward with other cases when Kerry interrupted to challenge him.

“Well, hold it,” Jackowski shot back. “I’m not done.”

A few minutes later, a Justice Department official passed Jackowski a note. Scrawled on the yellow pad were two words: “Cool down.”

Last week, a federal grand jury in Washington indicted two former presidents of BCCI and its alleged U.S. front-man, Ghaith Pharaon, on charges of illegally acquiring Independence Bank in Encino, Calif. In September, a federal grand jury in Tampa charged top bank officials and alleged drug figures in a new racketeering and money-laundering scheme. The two indictments were the first federal charges since the original BCCI indictment in Tampa in October, 1988.

The initial Tampa charges resulted from the two years that Mazur spent posing as a money launderer. He said that he won the confidence of senior BCCI employees, who helped improve his money-laundering scheme, and moved $14 million in Colombian drug profits through BCCI in Miami, Panama and Paris before the bankers were arrested at a phony wedding party.

Mazur said that the arrests were premature and that he believed he was close to implicating higher-ups in the bank and obtaining more information about its dealings with other Colombian drug dealers.

He and the Justice Department officials said that the undercover operation was ended because seizures of cocaine shipments in Detroit and Philadelphia in the summer of 1988 meant that information about the inquiry would be disclosed in court, jeopardizing Mazur and other undercover agents.

In addition, Colombian drug dealers had grown suspicious after they spotted undercover police at a money pickup by Mazur’s organization in New York in July, 1988. A month later, Mazur was summoned to a Miami hotel room where a lieutenant in the Medellin cartel said there were suspicions he was a federal agent. There was “no hole in the world deep enough to hide in” if the cartel discovered he was a cop, Mazur was warned.

Mazur and Jackowski both rejected charges that there were political reasons for making the initial arrests a month before the 1988 presidential election.