Bank of China to Stand Trial for Abetting Terrorists

Bank transferred money despite warnings funds were sent to terrorists
September 18, 2013 Updated: September 19, 2013

Bank of China is being sued by 50 people in New York Supreme Court on charges the bank knowingly transferred funds to terrorist organizations, which led to deadly terrorist attacks in Israel between 2004 and 2007.

Bank of China moved to dismiss the complaint on July 8, 2011, but the New York Appellate Court ruled on Sept. 17 that the trial will proceed.

The People Republic of China’s state-owned Bank of China is one of China’s four major banks. It allegedly transferred millions of dollars to two terrorist organizations: Hamas and the Palestine Islamic Jihad. The funding was then allegedly used to help pay for Palestinian rocket attacks and suicide bombings.

The plaintiffs include victims of the attacks, and families of victims. They are seeking both compensatory and punitive damages.

They allege that starting in 2003, the Bank of China executed dozens of wire transfers of several million dollars for Hamas and the Palestine Islamic Jihad.

The money was allegedly transferred from terrorist leaders in Iran and Syria, and sent to a Bank of China account in Beijing run by senior operatives of the terrorist groups. From there it was transferred to leaders of the terrorist groups in the Gaza Strip and West Bank where the cash was allegedly used to carry out attacks.

The plaintiffs said that in April 2005, Israeli counterterrorism officers met with officials from the Chinese Ministry of Public Security and China’s Central Bank about the wire transfers, and demanded Chinese officials take action and prevent the Bank of China from making further transfers of funds to terrorist groups.

“Despite the Israeli warnings, the [Bank of China]–with the Chinese government’s approval–continued to wire terrorist funds for the Hamas and [Palestine Islamic Jihad],” according to a press release sent on behalf of the plaintiffs.

The ruling from the New York State Appellate Division court holds that in the upcoming trial, the New York court should apply Israeli law.

Defendants from the Bank of China moved that Chinese law should apply in this case, since the bank is headquartered in Beijing, but the request was denied.

The court’s decision said, “We find that there is nothing repugnant to New York public policy in holding that Israeli law applies to this action.”

The court said the plaintiffs’ expert had explained that Bank of China’s “alleged transmission of funds is sufficient to bring it under the enactment forbidding the ‘giving’ or ‘payment’ of funds to terrorist groups” in Israeli law.

The Appellate Court’s decision now assures the suit against Bank of China will return to the Supreme Court for discovery and trial.

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