Arab Bank accused of aiding Hamas in lawsuit from Mideast terror victims

Eugene and Lorraine Goldstein, two of the plaintiffs Eugene and Lorraine Goldstein, two of the plaintiffs that sued Arab Bank for allegedly providing financial services to terrorist groups in the West Bank, with a photograph of their son Howard Goldstein who died in a terrorist attack in Israel in 2003. Photo Credit: Newsday / Karen Wiles Stabile

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Nearly 300 victims of Mideast terrorism and their relatives could win hundreds of millions of dollars from Jordan's Arab Bank in a first-of-its-kind lawsuit set to go to trial this week in federal court in Brooklyn, but their lawyers say the case is about more than money.

"That's a distant second," said New Jersey lawyer Gary Osen, who helped begin the case in 2004. "These people have been identified as victims for the last decade. It's an opportunity to feel they are not entirely victims, they are doing their part to try to reduce the capacity of groups like Hamas."

The trial will focus on charges that the bank -- the largest in the region -- should be held responsible for 24 terrorist shootings and bombings in Israel and Palestinian lands during the intifada from 2000 to 2004 because it provided financial services that aided Hamas.

Several attacks considered

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The attacks at issue range from notorious suicide bombings, such as the 2001 explosion at a Sbarro's in Jerusalem that killed 15, to smaller attacks, such as a 2003 highway shooting near Ramallah that wounded two Long Islanders, Eugene and Lorraine Goldstein of Plainview, and killed their son, Zvi.

Brought under a law that lets U.S. citizens collect triple damages for acts of international terror, the suit alleges that the bank maintained accounts for Hamas leaders and affiliates and encouraged suicide bombings by transferring money for a Saudi charity that included some payments to the families of dead bombers.

But the bank has fought the charges fiercely. It contends that it did no more than provide financial services in a conflict-torn region, never knowingly aided terror groups or did anything that was directly linked to a particular terrorist act, and has been targeted only because it has deep pockets.

"Arab Bank has great sympathy for all victims of terrorism but is not liable for the tragic acts described by plaintiffs," bank spokesman Bob Chlopak said. "The facts show that Arab Bank provided routine banking services in compliance with applicable counterterrorism laws . . . and had no intention of providing support to Hamas or any other known terrorist organization."

The case will be the first to go to a jury against a financial business under the federal Anti-Terrorism Act, and is believed to be the largest ever tried in number of plaintiffs and potential damages. It is expected to involve testimony from only a few victims and eyewitnesses, and focus heavily on experts, bank employees and documents.

The plaintiffs will have to convince the jury that the different attacks were Hamas operations, that the bank knew it was handling accounts linked to Hamas and transactions supporting terrorists or turned a blind eye, and that it was foreseeable that its services would enhance the likelihood of terror attacks.

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Case viewed as a challenge

Despite jurors' natural sympathy for terror victims and the impact of recent violence in the Mideast, the plaintiffs' lawyers view it as a challenge.

"Terrorism is not product liability," Osen said. "You're not bringing in experts to talk about the maximum tolerance of a bridge or the side effects of a drug. This is fairly unusual. It's a different animal from other cases and that produces challenges."

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Arab Bank, however, contends that its defense has been hamstrung by incorrect court rulings, which don't require proof that the bank intended to aid terrorism or that its behavior was the direct "but for" cause of any terror act, and have restricted evidence of its compliance with foreign laws.

Also, because the bank refused to turn over some account records, citing Jordanian bank secrecy laws, jurors will be allowed to infer that it knowingly provided services to terror groups, and the bank's ability to dispute that has been limited.

Combined with the emotional appeal of U.S. victims suing in a Brooklyn courtroom, the bank has warned, those rulings may create a "virtual show trial." Chlopak says an adverse verdict would set a bad precedent and "create vast uncertainty" in international finance.

But Osen says a precedent is what many victims are looking for, to get banks to pay attention and choke off the money terror groups such as Hamas need to function. "It's the deterrent value," he said.

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