Judge: Arab Bank Plc may be liable to terror victims

Imposing tough sanctions in a high-stakes terror-financing case, a federal judge in Brooklyn ruled Tuesday that Arab Bank Plc may be found liable to victims of international terrorism based on its refusal to turn over documents on its dealings with groups accused of terrorism.

"I am satisfied that plaintiffs have shown the high likelihood that the withheld documents would show repeated transfers by the bank to terrorists, terrorist organizations, or their fronts, or on their behalf," wrote U.S. District Judge Nina Gershon.

The Jordan-based bank, with $50.6 billion in total assets and branches in 30 countries, including the United States, was sued in 2004 by hundreds of victims and families who say it provides financial services to sponsors of attacks in Israel, including Hamas, and helps distribute financial benefits to families of suicide attackers and other "martyrs."

The bank, citing foreign bank secrecy laws in Jordan and elsewhere, said it could not turn over documentation the plaintiffs needed to prove their case. Gershon's ruling means that, based on the refusal alone, a jury will be allowed to infer the bank did business with terrorist groups with intent to further terrorist activities, and find against them.

No trial is scheduled yet.

Victims' lawyers lauded the "landmark" decision. Arab Bank said it "has produced hundreds of thousands of documents and successfully sought waivers from bank secrecy laws. . . . We look forward to exercising all of our legal options regarding the ruling and proving the falsity of the plaintiffs' claims at trial."