UK bank accused over cash for terror

Times Online ^ | December 12, 2004 | Nick Fielding

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HSBC, one of Britain’s biggest banks, has been accused of channelling tens of millions of pounds to suicide bombers. It will be alleged in a court action that an account at a subsidiary of the bank in Saudi Arabia was used to collect and pass funds to organisations which then used the money to help Palestinian suicide bombers and their families. A former Citibank subsidiary will also be accused.

Among the groups that received the funds is Hamas, whose supporters have carried out scores of suicide bombings against Israelis.

Money was raised through public appeals in Saudi Arabia with one stating: “Our Palestinian brothers are facing the Israeli war machine and they are defending the third sacred place in Islam — the blessed al-Aqsa mosque.

“They don’t have weapons. Only a few days passed since the al-Aqsa intifada began and already there are lots of martyrs, wounded and orphans.”

According to documents seen by The Sunday Times, the appeals directed donations to a special account, called Account No 98, in at least eight banks in Saudi Arabia including HSBC’s subsidiary.

These accounts were set up at the instigation of the Saudi authorities who required the banks to pass the money on to a fund administered by Saudis. From there it was distributed to organisations including Hamas, Palestinian Islamic Jihad and the al-Aqsa Martyrs Brigades, and also to designated international terrorist organisations.

The allegations will be made in a legal action to be launched in the United States by British, American and Israeli lawyers representing 500 victims of suicide bombings. The first writ, to be lodged this week, will name a Jordanian-owned bank; further writs are to be filed against at least seven other banks and their subsidiaries, including HSBC.

This weekend HSBC, which in an expensive television advertising campaign styles itself as the “world’s local bank” and prides itself on its local knowledge, indicated that it would be contesting the action.

A spokesman confirmed that HSBC had a 40% stake in its Saudi subsidiary, the Saudi-British Bank, but said the bank was managed locally. He declined to comment further until the bank had seen details of the writs. The legal action comes at a time when victims of terror are increasingly using the civil courts to take action against those they deem responsible for carrying out terrorist acts.

Civil lawsuits have already been issued against dozens of individuals and corporations after the September 11 attacks. Gavriel Mairone, one of the Israeli lawyers in the forthcoming legal action against HSBC and other banks, said this weekend: “In the past four years terrorist organisations have launched 339 attacks specifically targeting the Israeli civilian public, resulting in more than 8,000 casualties and with over 1,000 deaths.

“We believe these attacks were facilitated by a network of government-sponsored charities, international banks and ‘charity’ front organisations established in the UK, the USA, Israel, the Palestinian-administered territories and throughout Europe. For the first time victims of terrorism will assert in civil courts that the facilitation of financing terrorism and terrorist organisations is itself a crime against humanity.”

Citibank sold its Saudi subsidiary in the summer. Leah Johnson of Citigroup, its parent company, said: “Any assertion that Citigroup supports terrorism in any way is an outrage.”