Monday, July 14, 2008

AMEX Bank Sued by Terror Victims

85 Victims of Hizbollah Terrorist Rocket Attacks File Unprecedented Civil
Suit Against American Express Bank in New York Court

First American Correspondent Bank to be Sued for Aiding Terrorist Organization Facing $650 Million in Damages

Eighty five American, Israeli and Canadian victims of Hizbollah terror attacks have filed an historic civil action in the New York Supreme Court in Manhattan against American Express Bank Ltd. (“AMEX Bank”) and the Lebanese-Canadian Bank SAL (“LCB”). The suit, Licci v. American Express Bank, requests $650 million in compensatory damages and an unspecified sum of punitive damages.

Amex Bank, headquartered in New York, serves as one of LCB’s correspondent banks the United States, and in that capacity processes LCB’s dollar transactions. LCB’s main office is in Beirut, and it has branches throughout Lebanon and a branch in Canada.

The plaintiffs, whose family members were killed or who were themselves injured by rocket attacks fired at northern Israel by Hizbollah in the summer of 2006, allege that AMEX Bank and LCB unlawfully executed millions of dollars in wire transfers for Hizbollah between 2004 and 2006. The plaintiffs assert that Hizbollah used the funds transferred by Amex Bank and LCB to prepare and carry out the rocket attacks which the terrorist organization rained on Israeli cities between July 12 and August 14, 2006.

The plaintiffs rest their claims in part on written findings issued by the New York State Banking Department last year, which determined that AMEX Bank had failed to establish adequate procedures to prevent terrorism financing as demanded by state and federal law. This is the first lawsuit brought by terror victims against an U.S. financial institution that serves as a correspondent for a bank in Lebanon.

The plaintiffs are represented by attorneys Robert J. Tolchin Esq. of New York City, and Nitsana Darshan-Leitner, Esq. Director of the Shurat HaDin - Israel Law Center human rights organization of Israel.

Attorney Darshan-Leitner stated that: “Hizbollah is a financial giant which is deeply entrenched in the Lebanese banking system. Any U.S. bank that serves as correspondent for a Lebanese bank may well be aiding and abetting Hizbollah terrorism, and runs the risk of serious civil liability. U.S. correspondents for Lebanese banks owe it to themselves and to their shareholders to carefully examine and re-evaluate their relationships with banks in Lebanon.”

According to attorney Tolchin: “There will be more suits to come against Lebanese banks and their U.S. correspondents.”

A copy of the complaint is available here: