Arab Bank should have known customers were terrorists, witness testifies

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Arab Bank should have known more than a dozen customers were "famous" Hamas terrorists, even though they didn't appear on international blacklists, an Israeli intelligence expert argued during a combative cross-examination Thursday in federal court in Brooklyn.

In one of several sharp exchanges on an issue at the heart of a landmark lawsuit by the victims of 24 Hamas attacks, former Israeli official Arieh Spitzen was challenged on why the bank's checks of watchlists from the United States, UN and European Union weren't enough.

"Who is entitled to decide who is a terrorist?" asked Arab Bank lawyer Shand Stephens. " . . . It's the government, isn't it?"

"In my opinion, I think a bank should get to know its clients," Spitzen answered. "If someone is a terrorist . . . whether they are on the list or not, the bank should know that."

Spitzen is a star witness for the plaintiffs, who say that the bank foreseeably enhanced the likelihood of terror attacks by processing dozens of transactions for Hamas operatives and charities and for a Saudi group that aided families of Palestinian "martyrs" during the 2000 to 2004 uprising against Israel.

Terrorists like the late leader Salah Shehadeh were so notorious, Spitzen insisted, that bank officials and local managers in the West Bank and Gaza had to know who he was.

"Why a state includes certain people on a list and doesn't include others, there are many reasons for that," testified Spitzen, who said plaintiffs' lawyers paid him $1.4 million to work on their case. "The fact that he wasn't on the list doesn't mean he wasn't famous."But Stephens, in a series of questions often laced with sarcasm, noted many of the "famous terrorists" cited by Spitzen had been imprisoned and then released by Israel, or allowed to remain free, and much of the information in Spitzen's dossiers postdated 2004.

The bank lawyer also questioned Spitzen about labeling one man a Hamas terrorist because he headed a committee to support prisoners, noting that at the time there were 28,000 to 30,000 Palestinian prisoners jailed for crimes ranging from throwing stones and breaking curfew to murder.

"Those who help terrorists in jail or their family members definitely help terrorism and in my opinion they are terrorists," Spitzen answered.

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The plaintiffs in the lawsuit include nearly 300 U.S. victims and their family members, including Eugene and Lorraine Goldstein of Plainview, who were wounded and lost their son in a 2003 attack.

Spitzen's cross-examination is scheduled to continue Friday. The trial began Aug. 11.

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