Investigators discovered the Kabul Bank, which was declared insolvent in August 2010, was little more than a Ponzi scheme that served well-connected customers.
The New York Times reported Tuesday 92 percent of the bank's loans, about $861 million, went to only 19 individuals or companies. The sum is equal to about 5 percent of the country's gross domestic product.
Those borrowers, the Times said, were not expected to pay back the loans, but none has been charged. Western investigators said they should at least be charged with conspiracy to defraud the public.
One of the more prominent borrowers is Mahmood Karzai, the president's brother.
It cost $825 million to bail out the bank, a sum equal to the government's annual revenues, the Times said.
Bank founder Sherkhan Farnood was given a 5-year sentence and ordered to repay $280 million in ill-gotten gains. Former Chief Executive Officer Khalilullah Frozi was also given a 5-year sentence and ordered to repay $530 million.
Both have personal and financial connections that include President Hamid Karzai and other top ranked Afghan officials.
Some of those convicted were regulators who were charged with neglecting their duties, but some said they were being punished for uncovering the fraud. The trial itself was a show for Western countries that threatened to hold off on billions of dollars of aid if the legal system did not take a stand against corruption, which is rampant in Afghanistan.
Some Western officials say the corruption benefits insurgent Taliban forces.