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---
category: "BCCI Scandal"
created: 2024-04-25
updated: 2026-05-01
tags:
- Person
- Lawyer
- Government Official
- BCCI
- Banking
- Politics
- USA
- Defense
- Lawyer
summary: "Clark Clifford (1906-1997) was a Washington attorney who served as Special Counsel to President Truman, co-authored the National Security Act of 1947, served as Secretary of Defense under Lyndon Johnson, and became the central American figure in the BCCI scandal after he and his partner Robert Altman personally vouched to banking regulators that BCCI would not secretly own First American Bank -- a representation that proved false."
---
Clark Clifford was a prominent American attorney and government official who advised Democratic presidents since [[Harry S. Truman|Truman]].[^1] He served as chairman of [[First American Bank]] and was chief U.S. counsel to [[Bank of Credit and Commerce International|BCCI]].[^1]
Clark McAdams Clifford was born December 25, 1906, in Fort Scott, Kansas. He earned a B.A. from Washington University in St. Louis in 1927 and an LL.B. from Washington University School of Law in 1928, after which he practiced law in St. Louis through World War II. He served in the Navy during the war, rising to captain, and arrived at the White House in 1946 as naval aide to President Harry S. Truman. He died October 10, 1997, in Bethesda, Maryland, at age 90.[^1]
### Political and Legal Career
### Truman Administration
Clifford arrived in [[Washington, D.C.]] in 1945 as a naval aide at the White House.[^2] He was a principal architect of "Fair Deal" politics and a co-author of the [[National Security Act of 1947]], which established the [[Central Intelligence Agency|CIA]] and the [[National Security Council]].[^2] He was a key figure in the creation of the [[United States Department of Defense|Department of Defense]] and participated in the formulation of the [[Truman Doctrine]], a policy of Soviet containment.[^2]
Clifford served as Special Counsel to President [[Harry S. Truman]] from 1946 to 1950, becoming one of the most influential aides in the Truman White House. In September 1946, he co-authored (with George Elsey) a classified report on Soviet foreign policy -- the "Clifford-Elsey Report" -- assessing that the Soviet Union intended to expand its influence through military force and subversion and recommending a policy of strategic containment. The document anticipated the Truman Doctrine.
He advised [[John F. Kennedy]] after the [[Bay of Pigs Invasion]] and served as Secretary of Defense under [[Lyndon B. Johnson]], leading efforts to extricate the United States from [[Vietnam]].[^2] Clifford also counseled [[Jimmy Carter]] on the [[Panama Canal Treaty]] and acted as his special envoy to Greece, Turkey, and India.[^2]
Clifford was a principal drafter of the [[National Security Act of 1947]], which established the [[Central Intelligence Agency]], the [[National Security Council]], the [[Joint Chiefs of Staff]], and unified the military services under a new [[Department of Defense]]. He remained Truman's closest domestic political advisor through the 1948 election, playing a central role in the campaign strategy that produced Truman's upset victory.[^1]
After leaving government service, Clifford maintained a private law practice, representing major corporations such as Firestone Tire & Rubber Company, Time Incorporated, and General Electric.[^2] He was known for his ability to navigate political complexities and his influence in Washington.[^2]
In 1950, Clifford left government and founded the Washington law firm Clifford & Miller (later Clifford & Warnke) with his partner Paul Warnke. Over the following three decades the firm became one of the most influential in Washington, with clients including Firestone Tire and Rubber, Time Incorporated, General Electric, and numerous major financial institutions.[^2]
### Involvement with BCCI
### Later Government Service
Clifford became involved with BCCI through his association with [[Bert Lance]], who introduced him to [[Agha Hasan Abedi]].[^2] Clifford and his law partner, [[Robert Altman]], were instrumental in BCCI's secret acquisition of [[Financial General Bankshares]], which later became First American Bank.[^3] They served as BCCI's lead counsel in the United States and were paid substantial legal fees for their work.[^4]
Clifford served as an informal advisor to President [[John F. Kennedy]] following the [[Bay of Pigs Invasion|Bay of Pigs]] failure in April 1961. President [[Lyndon B. Johnson]] appointed him Secretary of Defense in January 1968, replacing Robert McNamara. In what became his most consequential decision in public life, Clifford convened a private reassessment of Vietnam strategy and concluded the war was unwinnable at any politically acceptable cost. His recommendations shaped Johnson's March 1968 decision to seek negotiations and decline to seek re-election. Clifford later served President [[Jimmy Carter]] as a diplomatic troubleshooter, negotiating the Panama Canal Treaties and serving as special envoy to Cyprus, Greece, Turkey, and India.[^1]
Clifford and Altman were accused of lying to U.S. banking regulators about BCCI's secret ownership of First American Bank.[^10] In February 1988, they sold a large portion of their First American stock to a BCCI front man, making significant profits.[^6] This transaction occurred amidst growing scrutiny of BCCI's activities.
### BCCI and First American Bank
In July 1992, Clifford and Altman were indicted by a New York grand jury on charges of bribery and fraud related to their involvement with BCCI.[^7]
In 1977, [[Bert Lance]] -- former director of the Office of Management and Budget under Carter -- introduced Clifford to [[Agha Hasan Abedi]], the Pakistani founder of [[Bank of Credit and Commerce International|BCCI]]. Abedi sought American legal representation for a planned acquisition of [[Financial General Bankshares]], a Washington, D.C.-based bank holding company.
In 1978, BCCI orchestrated a hostile bid for Financial General Bankshares using a group of Middle Eastern investors as nominal purchasers. The [[Securities and Exchange Commission]] filed suit against the participants, alleging undisclosed concert of action. Clifford and his partner [[Robert Altman]] -- the son of a friend, then in his early thirties -- served as counsel to the investor group. Clifford personally assured banking regulators that BCCI would play no ownership or management role in Financial General; he represented the purchase as a straightforward investment by independent Arab shareholders. Regulators approved the sale in 1981 based on these representations.[^2]
The bank was subsequently renamed First American Bankshares, Inc. Clifford became chairman of the board; Altman became president. Both men received substantial legal fees for their continued representation of BCCI's interests. In 1986, the [[Central Intelligence Agency]] issued an internal report stating that BCCI had in fact owned First American since 1982 -- a report that was not acted on.[^2]
In February 1988, Clifford and Altman sold a large portion of their First American stock to [[Mohammed Hammoud]], a BCCI front man, for substantial profits.[^3]
### Indictment and Resolution
In 1989, Senate investigator [[Jack Blum]] brought evidence of BCCI's operations to Manhattan District Attorney [[Robert Morgenthau]], initiating the sequence of investigations that led to BCCI's collapse. When BCCI was seized by regulators worldwide in July 1991, the Federal Reserve Board ordered BCCI to divest its illegally acquired shares in First American.
In July 1992, a New York state grand jury convened by Morgenthau indicted Clifford and Altman on charges of bribery, fraud, and receiving benefits from BCCI in exchange for allowing BCCI to secretly own and control First American while representing to regulators that it did not. The Federal Reserve Board simultaneously brought civil charges.
Clifford, then 85 and suffering from serious heart disease, asserted that he had been deceived by Abedi and the other BCCI principals and had no knowledge of BCCI's actual ownership of First American. New York courts severed his case from Altman's on health grounds; Clifford was never tried. Altman was acquitted by a Manhattan jury in September 1993. In 1992, BCCI's liquidators had pleaded guilty and agreed to forfeit $550 million to settle criminal charges; the BCCI settlement fund ultimately recovered approximately $880 million, including the $225 million settlement by [[Khalid bin Mahfouz]] in December 1993.[^4]
Clifford died October 10, 1997, before any final legal resolution of the charges against him. He maintained his innocence to the end.
### Footnotes
[^1]: Beaty, Jonathan and Gwynne, S. C. *The Outlaw Bank: A Wild Ride into the Secret Heart of BCCI*. New York: Random House, 1993, p. 9.
[^2]: Beaty, Jonathan and Gwynne, S. C. *The Outlaw Bank: A Wild Ride into the Secret Heart of BCCI*. New York: Random House, 1993, pp. 181-187.
[^3]: Beaty, Jonathan and Gwynne, S. C. *The Outlaw Bank: A Wild Ride into the Secret Heart of BCCI*. New York: Random House, 1993, p. 194.
[^4]: Beaty, Jonathan and Gwynne, S. C. *The Outlaw Bank: A Wild Ride into the Secret Heart of BCCI*. New York: Random House, 1993, p. 217.
[^5]: Beaty, Jonathan and Gwynne, S. C. *The Outlaw Bank: A Wild Ride into the Secret Heart of BCCI*. New York: Random House, 1993, p. 30.
[^6]: Beaty, Jonathan and Gwynne, S. C. *The Outlaw Bank: A Wild Ride into the Secret Heart of BCCI*. New York: Random House, 1993, p. 215.
[^7]: Beaty, Jonathan and Gwynne, S. C. *The Outlaw Bank: A Wild Ride into the Secret Heart of BCCI*. New York: Random House, 1993, p. 14.
[^1]: Clifford, Clark, with Richard Holbrooke. *Counsel to the President: A Memoir.* Random House, 1991.
[^2]: Beaty, Jonathan, and S.C. Gwynne. *The Outlaw Bank: A Wild Ride into the Secret Heart of BCCI.* Random House, 1993.
[^3]: Beaty, Jonathan, and S.C. Gwynne. *The Outlaw Bank: A Wild Ride into the Secret Heart of BCCI.* Random House, 1993, p. 215.
[^4]: U.S. Senate, Committee on Foreign Relations. *The BCCI Affair: A Report to the Committee on Foreign Relations.* 102nd Congress, 2nd Session, December 1992. (Kerry-Brown Report.)