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Iraq's ousted bank chief professes his innocence

Associated Press

BAGHDAD (AP) - The ousted governor of Iraq's central bank on Friday criticized his removal amid accusations of financial wrongdoing as an attempt by the government to seize control of the institution.

Last month, Iraqi authorities abruptly fired Sinan al-Shabibi, a longtime bank governor, and issued arrest warrants against him and other bank officials. The moves came after a parliamentary committee began investigating alleged improprieties at the bank.

Al-Shabibi's removal reignited charges that Prime Minister Nouri al-Maliki is attempting to marginalize perceived opponents and grab control of the country's independent institutions.

In a telephone interview with The Associated Press, al-Shabibi insisted on his innocence and that of other bank officials, saying his name is "very clear."

He described the allegations targeting the bank's leadership as "a farce that should be ended," and said he fears the bank's independence is now under threat.

"They want to control the central bank. If they control the central bank, they will destroy the economy," he said of the Iraqi government. "I'm very worried about the central bank and the future of central banking in Iraq."

Al-Shabibi defended the bank's performance during his tenure, citing efforts to protect Iraq's cash reserves and keep its currency largely stable against the dollar.

He blamed political leaders for failing to take advantage of the economic stability and opportunities he believes the bank created, and suggested his critics do not truly understand how central banks work.

The allegations against al-Shabibi, raised by a special parliamentary committee formed to probe the bank, surfaced while he was in Japan on official business.

He is now living in Geneva but said he will return to Iraq to defend himself.

Al-Maliki has denied charges that al-Shabibi's ouster is politically motivated.

Ali al-Moussawi, a spokesman for the prime minister, repeated the government's position that it was parliament, not al-Maliki, that pushed for the bank governor's arrest.

"If he thinks that he is innocent, he should come and face justice," al-Moussawi said of the ousted governor.

In 2011, Iraq's Supreme Court ruled that the central bank and other previously independent bodies should be put under supervision of the Cabinet instead of parliament. Al-Shabibi was among those who criticized the move, which would effectively give al-Maliki greater control over the bank.

Al-Shabibi, 70, is widely seen as a politically independent technocrat. A former economist at the United Nations, he has led the bank since shortly after the U.S.-led invasion in 2003.

A report by the U.S. Special Inspector General for Iraq Reconstruction, a government watchdog, last month noted that many analysts credit the former bank governor with helping set the stage for economic growth by keeping inflation and interest rates low.

It described al-Shabibi as someone "who is widely viewed as personally honest and professionally effective."

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Associated Press writer Bushra Juhi in Baghdad contributed to this report.

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Follow Adam Schreck on Twitter at http://twitter.com/adamschreck


(Copyright 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.)
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