Kenneth Rijock

Kenneth Rijock

Wednesday, September 24, 2014

VERDICT IN ARAB BANK FOUND DEFENDANT LIABLE FOR ALL TERRORIST ACTS


If you had any doubts about the significance of the Arab Bank case, take a look at the Verdict Form*; it found the bank liable for all twenty four of  the specific terrorist acts listed by the Plaintiffs. This is not an inconclusive finding of fact; it directly links the banks to the deaths and injuries perpetrated by Hamas, after which the bank paid rewards to the next of kin of the suicide bombers and terrorists imprisoned for their acts.

The verdict will, of course be appealed, but since jury verdicts are generally regarded as sacrosanct by appellate judges, absent any fundamental errors, you must assume that it will be affirmed on appeal. This could open the floodgates to a huge number of new civil suits against banks that have failed to interdict terrorist financing operations which pass money through their accounts, to designated terrorist organizations.  Traditional AML compliance programs will require specific CFT strengthening, for risk management purposes, lest a bank be sued, for failing to identify, in real-time, terrorist financing.  

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