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In total, 21 defendants were found guilty on Tuesday of crimes ranging from fraud to negligence for their roles in the failure of Kabul Bank, which investigators have described as little more than a Ponzi scheme. Its main function was to funnel depositors' money to its own shareholders and their cronies.

The convictions were once unthinkable for many in Afghanistan, where political connections often equal legal impunity. Both Sherkhan Farnood, the founder, and Khalilullah Frozi, the former chief executive, had financial and personal ties to President Hamid Karzai and other senior officials.

The prosecution began only after Western countries made clear that billions in aid dollars hinged on legal action.

American and European officials have in recent months lauded the government's decision to prosecute. But the choice of whom to try has left lingering doubts about the Afghan government's commitment to cleaning up corruption, which pervades every level of the government and is seen as fueling support for the Taliban insurgency.

American and European officials have been particularly concerned that Mahmood Karzai, a brother of the president, has yet to be charged with any crimes. He was given large loans, one of which he used to buy 7 percent of the bank, and none of which he was expected to pay back. Some Afghan and Western investigators say he still owes tens of millions of dollars, though he says he has repaid all his debts.

At the same, those convicted on Tuesday included a handful of Afghan regulators who had tried to uncover the fraud at Kabul Bank. They were convicted negligence; one was fined and the others were sentenced from six months to two and a half years in prison.

According to Afghan and Western investigators, the regulators were actively deceived by the bank's owners, who kept double books and engaged in other ploys to cover up their deceit. The owners even created fictitious companies, including fake letterheads and rubber stamps to leave a paper trail that would appear legitimate.

The Karzai administration also stymied the regulators' work, the investigators said before Tuesday's verdicts. They had characterized the prosecutions as an attempt to seek retribution.

Once celebrated by American and Afghan officials as a cornerstone of the Western project to rebuild Afghanistan, the Kabul Bank was taken over by regulators in August 2010 after becoming perilously insolvent.

At the time of its takeover, 92 percent of its loan portfolio — $861 million, or about 5 percent of Afghanistan's annual economic output at the time – had gone to 19 people or companies, according to a forensic audit by Kroll Associates, an international investigative firm. All were part of a clique that was tied to Mr. Karzai's government.

Bailing out the bank cost the cash-strapped Afghan government roughly $825 million, a sum that at that time represented most of the government's annual revenues. Estimates of how much has been recovered from those who received loans vary from $200 million to $400 million, Afghan and Western officials have said.

Yet few of the people who received millions of dollars in loans have been charged with any crimes, although they took the money with no expectation of repaying it — an act that investigators have said could make them liable to conspiracy charges.

Among that group are Haseen Fahim, the brother of First Vice President Muhammad Qasim Fahim. Kroll had recommend that both he and Mahmood Karzai, the president's brother, be prosecuted. Its audit said they each still owe at least $5 million. Both men have previously denied any wrongdoing.

But the biggest recipients of the bank's largess were its two largest shareholders: Mr. Farnood, the founder, who Kroll said should be held liable for $270 million, and, and Mr. Frozi, the chief executive, whose personal liability was estimated at $94.2 million by Kroll.

Along with their five-year prison sentences, Mr. Farnood was fined $280 million on Tuesday, and Mr. Frozi was fined $530 million, which is what the court had determined they stole. Both were remanded to the custody of The National Directorate of Security, Afghanistan's intelligence agency.

They can appeal their convictions and Mr. Farnood's lawyer said on Tuesday that his client would do so. "My client did not do anything illegal. This was not a fair trial, it was a political trial, and many high ranking people abused their positions to the detriment of my client," said Sebjhutullah Tamil, the lawyer. Neither Mr. Frozi nor his lawyer could be immediately reached for comment.