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Jordan’s Arab Bank Goes on Trial in NY for Terror Financing

It has taken 10 years to drag the Arab Bank into an American court room, but persistence finally won out.
US Supreme Court rejected a petition by the Arab Bank to hear its case, sending the case back to the lower court in Brooklyn.

US Supreme Court rejected a petition by the Arab Bank to hear its case, sending the case back to the lower court in Brooklyn.
Photo Credit: Nicolas Stambach

A worldwide legal earthquake is about to begin in Brooklyn, where the Jordan-based Arab Bank goes on trial today (Monday) for authorizing money transfers from terror entities to Hamas members abroad.

The case, a lawsuit by the families of US victims of terror, has been 10 years in the making and revolves around ‘martyr payments’ to the relatives of Hamas suicide bombers via the Jordan-based Arab Bank through its New York branch during the second intifada.

The plaintiffs claim in their suit the Bank has violated Section 2339B of Title 18 of the US Code, which makes it illegal for an entity within the United States to provide material support or resources to designated foreign terrorist organizations. Hamas is included on that list. Attorney Gary Osen of Osen LLC is the lead attorney in the case.

This is the first-ever civil trial targeting terrorist financing, one that has dragged on for a decade because Arab Bank has worked just that hard to fight it — or at least to delay the proceedings as long as possible. When the Supreme Court rejected the Bank’s petition to hear the case in June, the way was paved for today’s hearing in Brooklyn.

In April 2013, a New York Federal Court penalizing the Bank with an order imposing sanctions for refusing to submit documents for review by the plaintiffs to determine whether they could be used as evidence in the case.

That order raised Cain between three agencies at the federal level in the Obama administration – the US State Department, the Justice Department, and the Treasury Department – as officials tried to decide just how to deal with this delicate but dirty matter that affects not one, but at least two or more of America’s closest allies in the Middle East.

The Bank claimed it refused to submit the documents because it could have violated bank secrecy laws in Jordan and Lebanon. The lower US court was having none of that and ruled a jury could interpret that to mean an automatic admission of guilt on the part of the Bank.

In a pre-trial statement to Forbes, the Bank commented, “The facts show that Arab Bank provided routine banking service in compliance with applicable counter terrorism laws and regulations, and had no intention of providing support to Hamas or any other known terrorist organization.”

The Bank is accused of facilitating massive money transfers from 1998 to 2004 to Hamas leaders and institutions, as well as to the families of jailed Hamas members and suicide bombers. The money allegedly came from insurance benefits provided by the Saudi Committee and the Hezbollah al-Shahid Foundation. Both supported the intifada by providing benefits to the families of those who “martyred” themselves or who became injured or captured by the IDF in the process.

The insurance was “ultimately designed to provide substantial material support to Palestinian terrorist organizations and to provide a meaningful incentive both to prospective recruits and to individuals contemplating the commission of independent acts of violence in the name of the ‘popular resistance’,” according to the complaint, as quoted by Business Insider.

There were five attacks specified in the complaint in which Arab Bank allegedly facilitated money transfers to the relatives of Hamas terrorists. One was the October 2003 case of John Linde Jr., murdered with two other security officers while escorting US diplomats to interview Palestinian Arab candidates for Fulbright Scholarships. The three were killed by an IED (improvised explosive device, also known as a ‘homemade bomb’) in northern Gaza. A second involved 3-year-old Tehilla Nathansen, killed while sitting on her mother’s lap when terrorists blew up the No. 2 bus in Jerusalem in August 2003. A third child, 8th grader Jacob Mandell, was killed in a hail of rocks hurled by attacking Palestinian Arabs along with another friend while hiking in May 2001. And so on.

The plaintiffs allege that because the Arab Bank knew the funds were related to terror groups and terror activities, the Bank bears civil liability for the deaths of victims of terror resulting from attacks by those who received those funds.

The families of the terror victims are suing the Bank for damages to compensate for the murders of their loved ones.

The wire transfers were allegedly sent from terrorist sources to other international terrorists, among them Gaza’s current Hamas de facto Prime Minister Ismail Haniyeh, and former Hamas commanders Salah Shehada and Ahmed Jabari – now dead – as well as Hamas co-founder Ibrahim al-Muqadama.

The Bank contends there is no proof the funds went to terrorists and claims there is no proof the funds contributed directly to any terror attack. The Bank also claims the transfers were made without the institution’s knowledge of breaking the law at the time.

As the case has made its way through the court system, the picture has become clearer. Some of the past funding sources in dispute had received transfers themselves from the US government and were declared “terror free.” But some of this evidence has since been thrown out of court as “too general.”

But there is also a question of responsibility on the part of the US government, which allegedly has not always make clear who should be held responsible for what, or when. The Bank raised the issue of whether some of the funding sources were on the watch list of the US Office of Foreign Assets Control at the time of transfer – which may be a legitimate claim.

The US government, meanwhile, has slammed the lower court for not fully considering the foreign policy consequences of ignoring Jordan’s sovereign interests in this case. The Arab Bank is Jordan’s national bank, and if it loses the case, the Obama administration contends that the Jordanian economy and possibly the country’s motivation for counter terror cooperation with the United States could go up in smoke.

In May, the US government did not ask the Supreme Court to intervene pre-trial — and the Supreme Court rejected the Arab Bank’s petition to hear its case. But the Obama administration has made it clear that if Jordan’s interests are not taken into account, the government reserves the right to intervene, post-trial.

About the Author: Hana Levi Julian is a Middle East news analyst with a degree in Mass Communication and Journalism from Southern Connecticut State University. A past columnist with The Jewish Press and senior editor at Arutz 7, Ms. Julian has written for Babble.com, Chabad.org and other media outlets, in addition to her years working in broadcast journalism.


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6 Responses to “Jordan’s Arab Bank Goes on Trial in NY for Terror Financing”

  1. Hamas are millionaires from UN funds

  2. Hamas terrorists must be estimated from the face of this earth

  3. Terror is all over the world, it is suprising that many people hate Israel and USA when fighting against terrorism,it seems they don’t recognise danger ahead of them.

  4. Terror is all over the world, it is suprising that many people hate Israel and USA when fighting against terrorism,it seems they don’t recognise danger ahead of them.

  5. no surprise, but thank goodness we’re on top of it. Where are you, Standwithus, in organizing a rally around this event? It’s important.

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