Arab Bank’s Disputed Transfers Also Routed Through New York Banks

September 16, 2014
Dan Fisher

Many of the money transfers at the heart of a precedent-setting lawsuit against Arab Bank over terrorist financing also passed through banks like Citibank, Bank of New York and JP Morgan Chase, the deputy manager of Arab Bank’s New York bank has testified. The evidence wasn’t offered to show complicity by the larger banks in financing terrorism, but to show that the global banking system is complex and relies on automated systems to check against questionable transactions.

As the trial enters its sixth week, lawyers for the bank and plaintiffs accusing it of facilitating attacks in Israel and the Occupied Territories have repeatedly sparred over whether bank officials knowingly allowed money to flow to terrorist organizations. Arab Bank may rest its case as early as tomorrow, after cutting several witnesses whose testimony would have been severely limited under rules imposed against the bank as a penalty for failing to turn over customer banking records.

In testimony late last week, Brian Billard, a 15-year employee in the bank’s New York office, said all of the 969 transactions in the case that passed through New York were screened against the government’s Office of Foreign Asset Control list. In many cases, the money also flowed through other banks that also screened against the OFAC list, he said. And in both cases where the money slipped through the OFAC screen and landed in the account of designated terrorist organizations, other banks had also failed to catch the error.

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