Afghan nominated as ambassador to Britain was accused in US of fraud
Mohammad Daud Yaar, one of President Karzai’s inner circle, rated unfit for top UK post by ‘victims’ who brought civil case
Luke Harding, and Emma Graham-Harrison in Kabul
guardian.co.uk, Wednesday 6 June 2012 19.27 BST
The man who has been nominated as Afghanistan’s new ambassador to the UK has been accused in the US of fraud and appears to have landed the job thanks to his contacts with Hamid Karzai’s powerful family.
Mohammad Daud Yaar is at present director of economic affairs at the foreign ministry in Kabul, and a key conduit between the Afghan government and donor agencies and embassies.
In 2010 a family of Afghan immigrants accused Yaar, in a civil court in California, of defrauding them. He admits to owing them $100,000.
Officials in Kabul have confirmed that Yaar has been nominated as the ambassador to London. He has yet to take up his post. The Foreign Office says it is unclear when he will arrive and adds that he is not ambassador yet. Yaar denies fraud and says he intends to repay the money.
Afghan sources said Yaar secured the UK job following intense behind-the-scenes lobbying by Mahmoud Karzai, the president’s influential brother, whose business activities in Afghanistan are also being investigated in the US.
Yaar spent about 20 years in the US. He lived with Ahmed Wali Karzai (a brother who was killed) in the late 1980s and 90s, when the family ran a restaurant in Chicago. Ahmed Wali shared the business with Mahmoud and another Karzai brother, Qayum.
Yaar’s appointment to the high-profile London post is likely to raise questions about alleged rampant corruption and nepotism at the heart of the Karzai administration.
Ahead of the Afghan president’s departure from office in 2014, family members have been fighting among themselves for control of the fortune they have amassed over the past decade, the New York Times reported this week.
The feuding within the Afghan elite has intensified as the 2014 deadline for the withdrawal of US, British and Nato troops draws nearer. There are fears in Kabul that once the soldiers are gone, and if the west’s financial and military support drops off, the country could slip back into civil war.
Many people who have grown rich in Afghanistan are looking for a safe haven abroad for their assets, and often for their families as well.
Yaar returned to the country in 2009. He left the US following the settlement of a civil action against him. The plaintiffs, two Afghan-born brothers, Jamal and Ajmal Staneckzai, claim he “tricked, defrauded and deceived” them over the 2001 purchase of a house in Fresno, California.
Yaar insisted the case, from California’s superior court in Contra Costa, was a business deal gone wrong. He vehemently denied fraud.
“If I had committed fraud, why did they settle?” he told the Guardian in his office in a low-rise building inside the sprawling grounds of the Afghan foreign ministry. He added: “It was a business agreement and the other side backed off [from their side of the deal] and went to the courts. They couldn’t prove anything.”
Yaar said he was planning to pay off the remainder of the money he owed as soon as he could afford it, but his home in California was in negative equity and his small government salary in Kabul did not leave room for savings. He stressed: “My intention was to help these guys to solve their housing problem.”
But one of his alleged victims said that Yaar was not a fit person to become ambassador to the UK, let alone hold responsibility in Kabul for big financial issues.
Speaking by phone, Jamal Staneckzai told the Guardian he had wanted to buy a home for his elderly parents, Ghani and Amani, who fled Afghanistan in the 1980s during the Soviet occupation.
Unable to get a mortgage, he and four other families from the close-knit Afghan community in California turned to Yaar for help. Yaar bought a property in 2001 on their behalf, but registered it in his own name. The Staneckzais made regular mortgage payments, with several family friends providing the initial deposit as a loan, he said.
In 2005 the Staneckzais were finally able to get a mortgage. When they asked Yaar to transfer the property to them he refused and sold it to them for $358,900, promising to refund the net proceeds.
Instead, Yaar pocketed the cash, Staneckzai alleges “I was a part-time student at university back in 2001, which is why I couldn’t get a loan. We regarded Yaar as a close and respected uncle. He told us, “you guys will pay the mortgage costs and I will transfer everything back to you”. Instead he took every dollar from us. He took our equity.”
In January 2009 the family’s lawyer, Bashir Ghazialam, filed court papers alleging “breach of trust, breach of fiduciary duty and fraud”. In August 2010 he obtained a judgment against Yaar and his wife, Sadia, for $120,000, after the Yaars paid only $10,000 of agreed damages. Asked about the case Ghazialam said caustically: “If this guy becomes ambassador to the UK I might as well give up my law licence.”
In Kabul, Yaar denied that the Staneckzais had provided money for the deposit, even though the court claims give details of family friends who say they provided the cash. One friend is Khodaidad Karzai, one of the president’s uncles, whom, the Staneckzais say, lent them $5000. Yaar, however, insisted he paid the deposit himself.
Educated, clever, and a fluent English speaker, Yaar has a colourful biography. After graduating he taught economics in Kabul for several years. He fled the country in 1978 after the Soviet-backed government broke up an underground opposition group that he belonged to and which was centred on the university.
The group’s members agreed to write letters to foreign newspapers under fake names exposing the atrocities of the Afghan communist regime and its Soviet backers in Moscow.
Surviving members of the group said Yaar was the only one to escape. They suspect they might have been betrayed by a mysterious relative whom Yaar brought to a meeting the day before the arrests began.
“We were holding a meeting in July, and Daud Yaar came and brought a strange man we didn’t know. That evening we went to jail,” said one surviving member of the group, who asked not to be named. “My view is that [the man] was a spy for the communist government. I was a prisoner for a year and a half. They tortured us and we came close to being hanged.”
Yaar said his relative was also later arrested and badly tortured, adding: “I don’t believe that he would give me or the others to the military.”
Yaar spent 10 years in Germany before moving in 1987 to the US, where he shared a house with the Karzais.
Some sources said he worked before 9/11 as an informal PR adviser to the Taliban’s New York representative, Hakim Mujahid. Yaar dismisses this. Of the Taliban, he said: “I think they deceived everybody – they deceived the king, Professor Rabbani. They said they were going to disarm the country but it turned out they were just a bunch of crooks and terrorists.”
In California he worked as a part-time economics professor while amassing a property empire that included at least six houses.
Back in Kabul his connections got him a post on the Afghan National Security Council, chaired by Hamid Karzai. He was a key liaison between the council and a UK-funded agency, Adam Smith International.
In 2010 Yaar became the director of economic affairs at the Kabul foreign ministry, a plum job. He now liaises between the Afghan government and western donors on financial issues. British diplomats in Kabul appear unaware of the fraud allegations and have declined to comment.
The appointment follows a year in which the key London post lay vacant as the Afghan government struggled to find a consensus candidate for what is considered one of the most senior and prestigious diplomatic posts.
At one point Yaar was in the frame to become ambassador in Washington. The job eventually went to the deputy foreign minister Eklil Hakimi. Yaar then got London as a consolation prize, one source suggested.
His predecessor in the UK, Homayoun Tanda, struggled to make his mark. US diplomats who met him in 2009 noted that Tanda knew French fluently but could speak only “broken, heavily accented English” and that he “struggled” to communicate. This made it difficult for the Afghan government get its message across to British officials and the media, the US mission in London noted.