US JUDGE REFUSES TO DISMISS TERRORIST FINANCING & MONEY LAUNDERING CHARGES AGAINST ARAB BANK >
DIFFERENT POINT OF VIEW by Monte Friesner >
Financial Crime Consultant for WANTED SA >
Sunday November 07, 2010 >
WANTED SA has just learned today that the an appeal has reportedly been filed, with the Second Circuit Court of Appeals of a trial court order directing the entry of sanctions against a foreign bank operating in the United States for failure to disclose account information in a series of cases pending against it under the Anti-Terrorism Act [ATA].
The District Court ruling barred the banks from "making any argument or offering any evidence regarding its state of mind or any other issue that would find proof or refutation in the withheld documents," which in essence precluded the bank from introducing what it considered to be favorable evidence.
The bank it is alleged by the plaintiffs, funded payments to the next of kin of deceased suicide bombers.
The bank declined to make a required production of documents, asserting that, under the bank secrecy laws of the Palestine National Authority and Lebanon; it faced criminal prosecution in those countries.
The District Court Order*, entered on 5 October held that Comity, the respect for foreign law, and foreign bank secrecy laws, did not trump anti-terrorism laws, and due to the failure to make production, that the Court would tell jurors at trial that they could infer that the bank provided services to organizations currently designated as terrorist groups. The Court, speaking through Judge Nina Gerson, held:
- * "...the interests of the foreign jurisdictions where the discovery is sought in this case 'must yield to the interests in combating terrorism and compensating its victims.' " (Order at 6)
- * "I am satisfied the plaintiffs have shown a high likelihood that the withheld documents would show repeated transfers by the bank to terrorists, terrorist organizations, or their fronts, or on their behalf." (Order at 3)
- * "The evidence set forth in the Sanctions Order (describing the nature of the documents and information withheld by the bank on foreign bank secrecy grounds) confirms that international comity issues continue to weigh in favor of disclosure, and of sanctions for failure to disclose." (Order at 8)
We shall be following the appeal closely, and will report back to our readers on its progress.
* Linde vs. Arab Bank Plc, Case No.: 04-cv-02799-NG-VVP (ED NY).
For further reading:
Court Sanctions Arab Bank in Terrorist Financing case, August, 2010.
The facts and opinions stated in this article are those of the author and not those of WANTED SA. WANTED SA does not warrant the accuracy of any facts and opinions stated in this article; does not endorse them, and accepts no responsibility for them.