In a landmark decision, a New York jury on Monday found the Jordan-based multinational Arab Bank liable on 24 counts of supporting terrorism by transferring funds to Hamas.
The verdict came after the jury deliberated for nearly two full days after a month-long trial at the eastern district court in Brooklyn.
“This is an enormous milestone,” said Gary Osen, a lawyer on the team representing around 300 American relatives and the victims of 24 attacks carried out in Israel and the Palestinian territories during the Second Intifada. The federal lawsuit was filed in 2004.
“For the first time a financial institution is liable for supporting terrorism. The question now is to see how other financial institutions, regulators will deal with their banks and this decision,” he added.
The American victims and their relatives said the bank violated the 2001 Anti-Terrorism Act when it served as a conduit for money from a Saudi Arabian fund to families of Palestinians who died, including suicide bombers.
A second trial would have to determine how much the Bank will be liable to pay in damages.
District Judge Brian Cogan indicated it would be a long road ahead. “This case is a long way from over,” he told the court.
The defense argued there was no evidence Arab Bank executives supported terrorism and disputed the allegation that the institution knowingly made payments to designated terrorists.
But the plaintiffs said the bank transferred more than $70 million to an alleged Saudi terror entity, charities they claim were a front for Hamas and 11 globally designated terrorist clients.
Shand Stephens, the lawyer for Arab Bank, poured scorn on the verdict, saying it should not have been found on “evidence that thin.”
Asked whether the Bank would appeal, he told reporters: “This verdict is going to be reversed.”
Rolodex full of Hamas customers
The bank had “a Rolodex full of Hamas customers,” and lied in its defense, the plaintiffs said in their concluding remarks.
“They’re guilty,” prosecution lawyer Mark Werbner said in his concluding arguments on Thursday.
He said the bank must have known that helping Hamas would mean “bad things were going to happen and that’s enough to make them responsible.”
The trial heard that the bank was able to transfer $60,000 to Hamas spiritual leader Sheikh Ahmed Yassin — who was assassinated by Israel in 2004 — due to a spelling mistake of his name, which was not detected by screening software.
Every bank that has operations in the United States — like Arab Bank — uses the same automated software to screen those on terror blacklists.
“There’s not one word of testimony in this case that would lead you to conclude that any one of those people deliberately supported terrorism,” Stephens told the court on Thursday.
The Arab Bank says it closed accounts after holders were designated terrorists.
The US plaintiffs claimed that Hamas, which the US officially designates as a terror group, directed the distribution of the money from the Saudi fund.
Stephens said Arab Bank provided routine banking services and that no charity — including the Saudi committee — to whom it transferred funds was on any US, UN or EU blacklist at the time.
He said that between 2000 and 2004 its Saudi fund payments to 15,000 people each month were public and approved by Israel.
Stephens said there was no evidence to prove that any money transferred by Arab Bank had been used to finance terror attacks and that the cycle of violence in the decades-old Israeli-Palestinian conflict had nothing to do with his client.
The Arab Bank Group has more than 600 branches in 30 countries, with assets last year worth $46.4 billion and a shareholders’ equity base of $7.8 billion.