by Paul Alster
Special to IPT News
March 5, 2013:
A leading European bank faces trial in New York later this year after a federal judge found there is sufficient evidence it knew the funds were being used to support a Palestinian terrorist group.
U.S. District Judge Dora Irizarry denied French banking giant Credit Lyonnais SA‘s motion for summary judgment last Thursday, saying “there is a genuine issue” about the bank’s behavior with the accounts in question.
The case has been brought by 200 plaintiffs killed or wounded in more than a dozen Hamas terrorist acts between 2002 and 2004. Credit Lyonnais allowed a Palestinian organization that claimed to be a charity to launder Hamas money used in attacks in Israel in which the plaintiffs and their relatives were victims.
Credit Lyonnais is the first of three major international banks facing similar lawsuits in American courts; the others are the Arab Bank, one of the leading banks in the Middle East, and the major British banking giant, NatWest. If a jury finds the bank liable, the case could have massive repercussions across the world.
“This is a ground breaking decision for a New York court because we had the UBS case and another case against Arab Bank when the court said ‘No. You still have to prove that the bank had the same goals as the terror organization,’” said Nitsana Darshan-Leitner, director of the Israel-based Shurat HaDin (Israel Law Center). The group represents hundreds of terror victims in lawsuits throughout the world.
“Now, here is a court that says it is enough to prove liability if [the banks] are giving money to a terror organization.”
As a result, banks will have to be more careful to ensure their accounts don’t wind up helping terrorist groups or charities that serve them, Darshan-Leitner said. “Credit Lyonnais facilitated an account to CBSP; not directly to Hamas, but to a charity that funds Hamas. [The summary judgment] says that CBSP is designated because they fund Hamas, therefore no bank operating in the U.S. is allowed to give financial services to CBSP or to any designated charity or terror organization. It is a kind of a shockwave to the international banking system.”
The U.S. Antiterrorism Act of 1992 opened the door for lawsuits by terror victims against foreign entities, and U.S. criminal code makes it illegal for anyone to “knowingly provide material support or resources to a foreign terrorist organization.”
- Credit Lyonnais Suit Over Middle East Attacks Nears Trial – Bloomberg (bloomberg.com)
- UBS can’t be sued for currency transfer to Iran (moneyjihad.com)