President Ashraf Ghani has ordered the release of Khalilullah Frozi, the ex-CEO of Kabul Bank, who is accused of having a key role in the collapse of the bank that once Afghanistan’s largest financial institution.  

The text of a presidential decree seen by TOLOnews reads that Mr. Frozi has been released from the detention of the National Directorate of Security (NDS) on the order of Ghani who after assuming office as president in 2014 ordered the review the Kabul Bank bankruptcy case as a symbolic move that many Afghans at the time saw it as Mr. Ghani’s firm action against endemic corruption in public offices.

The decree argues that Mr. Frozi has been released due to an illness he suffers from.

The letter states that a task team led by Rashid Totakhel, head of policy and oversight and monitoring office of the president, was assigned to investigate the health condition and financial commitment of Mr. Frozi.

The decree says that the task team found that Mr. Froz had cooperated well in his financial commitments and that his cooperation could further expedite his reintegration to his family.

The decree also states that the task found Mr. Frozi’s health condition is unstable and if he dies in custody, the Afghan government would face serious criticism from the rights protecting organizations.

According to the assessment of the task team, in the legal perspective, there is no justification for Mr. Frozi’s transfer to his home and he should have been kept in jail or hospital.

But the letter states that its joint assessment with the court and the Attorney General’s Office from the interpretation of the law reveals that the house has also the status of the hospital.

“The president considered the outcome of the task team’s investigation legal and directed the head of the task team to implement its recommendations and transfer Khalilullah Frozi to his home,” reads the letter.

 “Less than one year has left for the completion of his [Khalilullah Frozi’s] jail term and also regarding the recuperation of the loans he received from the bank, the relevant bodies have done their job,” presidential spokesman Sediq Sediqqi said.

 In 2015, President Ghani ordered that Mr. Frozi should serve out his full 10 years in prison and pay his court-ordered fine of $137 million.

 Kabul Bank once Afghanistan’s largest financial institution collapsed in 2010 after reports of embezzlement of over $900 million.

 “Many of the Kabul Bank suspects who had high-level political relations in the present and the previous governments, were not treated legally and those involved in the collapse of the Kabul Bank were treated with a political approach,” said Naser Taimoori, a researcher from the Integrity Watch Afghanistan (IWA).

 “Such cases have always been treated politically. The chaos that we see in Afghanistan has a link with corruption,” said former presidential advisor Adila Bahram Nizami.

 This comes after Mr. Frozi’s colleague Sherkhan Farnood, former chairman of the old Kabul Bank, died in prison at the age of 57 last year in August.

 He was serving his sentence at Bagram Prison after being found guilty in the $900 million Kabul Bank embezzlement scandal in 2014.

  The Controversial Contract

 In November 2015, the government launched the 'Smart City Township' Project in which Khalilullah Frozi was a part.

 Government officials said the aim of the program was to help the debtors of Kabul Bank repay their debt instead of being imprisoned.

 The move, however, sparked an outcry.

 In February 2016, President Ashraf Ghani canceled the contract of the Smart City Township.

 Sherkhan Farnood was the chairman of Kabul Bank until late 2010, which was Afghanistan's largest private financial institution with over one million customers at the time.

 Farnood held a 28.16 percent share in the old Kabul Bank. By November 2010 both Farnood and Frozi had been suspended.

 As of early 2011, both were effectively under house arrest and could not leave the country.