Report of $1 billion settlement 'inaccurate,' says Arab Bank

In response to the report, Arab Bank said in a statement, "The terms are confidential and we will not comment on them specifically beyond saying the report is inaccurate."

August 22, 2015 09:23
2 minute read.
Arab Bank logo

Arab Bank logo. (photo credit: Courtesy)

Jordan’s Arab Bank on Friday described as “inaccurate” a report that it would pay “slightly more” than $1 billion to settle a historic judgment against it for terrorism-financing related to Hamas attacks in Israel.

The settlement in favor of hundreds of Americans ended the most dramatic terrorism- finance case against a major bank in US history, and pre-settlement, the judgment against the $46 billion Arab Bank had been estimated to be worth as much as billions of dollars.

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A deal was reached nearly a year after a US federal jury in Brooklyn, New York, found the bank liable, four months after the bank lost a shot at a retrial, days before a damages trial was set to start and 14 years after some of the terrorist attacks in question took place.

The public trial lasted five weeks and revisited some of Hamas’s worst attacks, including the August 2001 Sbarro suicide bombing in Jerusalem that killed or wounded 130, and a range of 24 attacks during the second intifada.

A total of 297 plaintiffs who were injured or are family members of those murdered in the 24 attacks from 1998 to 2004, which were financed via Saudi Arabia and Hezbollah’s al-Shahid Foundation, sued the bank in 2004 for allowing itself to be used as a conduit for the terrorism funds.

The 10 years of intense legal battles included trying to obtain the bank’s “secret” client documents located in Jordan, Lebanon and the Palestinian areas.

The US Supreme Court had already weighed in once pretrial and could have been asked to weigh in again post-trial, while the US State, Justice and Treasury departments fought over whether the US government should accede to Jordan’s requests to intervene in the case.

Citing an unnamed lawyer with knowledge of the settlement, the trade magazine The American Lawyer reported that Arab Bank had agreed to pay “slightly more than $1b.” to settle the suit.

In response to the report, Arab Bank said, “The terms are confidential and we will not comment on them specifically beyond saying the report is inaccurate.”

Michael Elsner, a lawyer at Motley Rice representing the families, issued an identical statement.

Prior to the judgment, The Jerusalem Post had been told by sources that after a morethan- decade-long fight, the plaintiffs would not settle for anything less than a massive judgment.

In February, another New York jury slapped the Palestinian Authority with a judgment of around $650 million in a terrorism-related case with some parallels.

Commentators had written that if Arab Bank was held liable for being a conduit for funds that eventually reached terrorists, the precedent could shake the international banking system to its foundations as many major banks may have used their size and looking the other way to dabble in such transactions.

Approximately 500 US citizens had sued Arab Bank under the US Anti-Terrorism Act, which permits US citizens to pursue claims arising from international terrorism.

Around 200 had their cases dismissed before the court issued its verdict, but they will still receive compensation under the settlement.

Last year’s verdict marked the first time a bank was held liable in US court for violating that law.

Yonah Jeremy Bob contributed to this report.

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