Terror Lawsuit Against French Bank Not Thrown Out

The International Herald Tribune reports:
U.S. judge refuses to dismiss terror finance suit vs French bank

NEW YORK For the second time in a week, a U.S. judge has refused to throw out a lawsuit accusing a European bank of knowingly providing financial services to charities allegedly controlled by a terrorist organization.

The ruling on Thursday by U.S. District Judge Charles P. Sifton in Brooklyn denied a defense motion by a French bank, Credit Lyonnais, to dismiss the suit brought by families of Americans who were victims of terrorist bombings and shootings in Israel between 2001 and 2003. Nine of the victims were killed in the attacks, which included suicide bombings linked to Hamas.

Last week, Sifton denied a motion to dismiss a similar suit against a British bank, National Westminster Bank.

The French bank "should be put on notice by this decision, which again affirms the civil remedies available to American victims of terrorism," said Gary M. Osen, a lead attorney for the plaintiffs.

A call to the New York attorney for Credit Lyonnais, a subsidiary of Credit Agricole, was not immediately returned.

The suit — which was filed in February under the Anti-Terrorism Act and seeks unspecified damages — accuses Credit Lyonnais of improperly doing business with a French-based charity that has been designated a terrorist organization by the Israeli and U.S. governments. The plaintiffs allege the bank knew the charity was funneling millions of dollars to Hamas to finance terrorism.

In court papers, the bank claimed it suspected the charity, CBSP, might be involved in money laundering, but not terrorism. It cited investigations in France that cleared the group of any wrongdoing.

Here seems to be the basis underlying the judge's ruling:

The judge said in his ruling that "it is reasonable to believe that when the bank noticed 'unusual activity' on CBSP's accounts in 2000, in the form of large transfers of money to the West Bank and Gaza strip during a highly publicized intifada, the bank would have investigated the organizations receiving the large transfers, including designations of terrorist organizations made by the government whose country was experiencing the terrorism."

Score 1 for common sense. On the other hand, the judge did make a distinction between providing material support to terrorists versus aiding and abetting them:

The ruling, while preserving a claim that the bank knowingly provided material support to a foreign terrorist organization, dismissed another claim that it aided and abetted the murder and wounding of U.S. citizens. On the latter claim, the judge found that "maintenance of a bank account and the receipt of transfer of funds does not constitute substantial assistance."

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