By Alison Frankel
Arab Bank was aware that it was processing wire transfers from a Saudi Arabian charity to the families of “martyrs” of the second Palestinian Intifada against Israel, according to deposition testimony from the bank’s global head of operations, played Thursday for jurors in a terrorism finance trial against the bank in federal district court in Brooklyn. Lawyers for nearly 300 American victims of Hamas attacks on Israel between 2000 and 2004 also aired deposition testimony in which they confronted three executives from Arab Bank’s Palestinian operations with evidence the bank was apprised that at least three of those “martyrs” killed themselves in civilian bombings.
The three officials said that they always followed the bank’s policies and procedures for transferring money from correspondent banks. But a former Arab Bank compliance executive from the London branch said in a deposition also played Thursday for the jury in Brooklyn that if he had seen the materials sent to those officials – including charts listing the cause of death of three of the men whose families were slated to receive wire transfers as “martyr operations” – he would not have processed the transfers.
“If this had arrived in London, which one never did in my experience, we would have immediately commissioned probably a multiple suspicious activity report, because this is something which we were most unused to dealing with,” testified former Arab Bank compliance official David Blackmore.
Blackmore’s testimony seemed designed to undercut Arab Bank’s primary defense, which is that its Palestinian branches engaged in nothing more than routine banking operations when they paid out about $100 million – about $40 million of it in cash over the counter – from the Saudi Committee for the Support of Intifada Al Quds, in money transfers via the Saudi-based Arab National Bank. Arab Bank’s lawyer, Shand Stephens of DLA Piper, told jurors in opening arguments earlier this month that the bank used standard banking compliance software to make sure that it was not processing payments to globally designated terrorists. (Four transactions in which Arab Bank did put funds in the hands of identified terrorists were “by mistake,” Stephens said in opening arguments.)
In the deposition testimony aired Thursday, Arab Bank officials from its Palestinian operations downplayed any suggestion that the wire transfers from the Saudi Committee were out of the ordinary. “We carried out the instructions of the correspondent bank,” said regional manager Assad Saleh, who audited operations in Ramallah. The Saudi Committee transfers, he said, were “just like any other.”
Both Saleh and Mohammed Al-Tahan, Arab Bank’s director of operations for the Palestinian Territories, said they did not regard as suspicious a document sent to Al-Tahan by Arab National Bank in April 2001, in which the Saudi bank clarified the intended beneficiaries of certain Saudi Committee wire transfers. The notice included “lists of martyrs’ names” in the West Bank and Gaza as well as causes of death for those killed in the West Bank. One recipient was specifically identified as having died in a “martyr operation,” or, in transliterated Arabic, “amaliya ishtishadiya.” A follow-up fax sent on the same day, after a purported phone conversation between officials at Arab Bank and those at Arab National Bank, identified the families of two others who died in “martyr operations” as Saudi Committee wire transfer beneficiaries.
Saleh said he never saw the charts sent by the Saudi bank, although their recipient, Al-Tahan, directed that they be forwarded to Saleh. Al-Tahan said he didn’t recall whether he had reviewed the charts, but that he had sent the Arab National Bank letters to the wire transfer department “as a matter of routine.” Even looking back at the lists, he said, the only suspicious thing about them was that they mentioned people who were dead. “The bank does not pay persons who are deceased,” he said.
Al-Tahan also said – in a theme the bank will doubtless emphasize when it makes its case to the jury – that the charts specify payments to “martyrs,” not to suicide bombers. Only a handful of the hundreds of Palestinians identified as martyrs by the Arab National Bank died in “martyr operations.”
“For the bank, the family of a martyr is like the family of a deceased person,” Al-Tahan said.
Lawyers for the American terror victims, including Gary Osen, Mark Werbner of Sayles Werbner and Michael Elsner of Motley Rice, sought to show the jury that some of the Saudi Committee transfers were highly unusual. In addition to the two martyr charts that Arab National Bank sent to Arab Bank, they asked bank officials about a January 2001 memo from Arab Bank’s legal division describing a “fatwa,” or Islamic legal pronouncement, issued after consulting Sharia law. (The memo outlined how Arab Bank branches in the Palestinian Territories should identify recipients of “transfers made in the name of martyrs.”) Though Al-Tahan and Saleh said the memo was not significant, the bank’s officially designated witness on the Saudi Committee transactions, global operations head Fazwan Shukri, said Arab Bank does not consult religious authorities and such consultation was “inconsistent with the bank’s practices.”
Shukri and Al-Tahan also acknowledged in their depositions that the Saudi Committee ran advertisements in newspapers in the Palestinian Territories, advising family members of those killed in the Intifada to come to Arab Bank branches to receive payments. Shukri said he found three or four ads in the files of Arab Bank branches when he conducted an internal investigation in 2007. The only possible reason why the ads would appear in bank files, he said, was because occasionally recipients of Saudi Committee wire transfers found out they were due money from the newspaper before payments were actually transferred to Arab Bank.
Lawyers for the victims showed Arab Bank witnesses several other documents that implied bank officials either made unusual efforts to identify beneficiaries of Saudi Committee payments or made unusual attempts to investigate how the Saudi group determined who should receive wire transfers. In addition, they asked the witnesses about two instances in which supposed charities other than the Saudi Committee attempted to direct payments to family members of those jailed, injured or killed in the Intifada. Al-Tahan, Saleh and Mazen Abu Hamdan, the general manager of Arab Bank branches in the Palestinian Territories, all insisted that the documents did not show that the bank took extraordinary actions. The third-party request to direct payments, for instance, would have been ignored and stuck in a file, according to Saleh.
The 11 jurors and alternates hearing the case seemed to be paying close attention, even though they heard only videotaped deposition testimony through the lunch break. If the American terror victims are going to convince them that Arab Bank encouraged Hamas attacks by facilitating payments to the families of suicide bombers, this was the testimony that will do it.
The bank will begin to present its case next week, after the conclusion of live testimony by the victims’ final expert witness.
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