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HBL faces liability in terror financing case in US

Habib Bank Limited (HBL), the largest bank in Pakistan, is facing secondary liabilities in a terror financing activities in the United States where the plaintiffs claimed the bank participated in a plot to launch assaults that left 370 people dead or injured and helped fund al-Qaeda terrorism.

As a party that “aids and abets, by knowingly providing substantial assistance, or who conspires with the individual who committed such an act of international terrorism,” according to Judge Lorna G. Schofield, the bank is subject to liability under the Justice Against Sponsors of Terrorism Act.

In three consolidated cases, the plaintiffs “sufficiently” claimed that the attacks were planned or authorised by a “Foreign Terrorist Organization,” such as al-Qaeda or syndicates Lashkar-e-Taiba, Jaish-e-Mohammed, the Afghan Taliban, including the Haqqani Network, and the Tehreek-i-Taliban Pakistan, according to a judge,

“The plaintiffs sufficiently establish that the bank was aware of the direct and indirect contributions made by its customers to the broader terrorism campaign of al-Qaeda.

In three consolidated cases, the plaintiffs “sufficiently” claimed that the attacks were planned or authorised by a “Foreign Terrorist Organization,” such as al-Qaeda or syndicates Lashkar-e-Taiba, Jaish-e-Mohammed, the Afghan Taliban, including the Haqqani Network, and the Tehreek-i-Taliban Pakistan, according to a judge.

“The plaintiffs sufficiently establish that the bank was aware of the direct and indirect contributions made by its customers to the broader terrorism campaign of al-Qaeda.

The judge added, “The charges also allege that the bank intentionally and significantly assisted al-Qaeda and its proxies dodge sanctions and engage in terrorist acts, which meets the ‘knowing assistance’ threshold.”

The claims, according to Judge Schofield, are sufficient to demonstrate that HBL “engaged in a conspiracy to commit the attacks.” Although none of the claimed banking services offered by HBL “were themselves acts of international terrorism,” she rejected the plaintiffs’ claims of primary liability, the newspaper continued.

Prior to this, HBL had agreed to pay a $225 million fine in 2017 for a variety of regulatory rules infractions, the highest fine ever levied against a Pakistani bank by regulatory authorities.

Additionally, the bank had agreed to cease operations in New York and give up its permit to have a branch there. Since 1978, the branch has been open for business.

The Department of Financial Services (DFS) of New York State severely criticised the bank at the time in a strongly worded press release, adding that “DFS will not stand by and let Habib Bank sneak out of the United States without holding it accountable for putting the integrity of the financial services industry and the safety of our nation at risk.”

Prior to this, HBL had agreed to pay a $225 million fine in 2017 for a variety of regulatory rules infractions, the highest fine ever levied against a Pakistani bank by regulatory authorities.

Additionally, the bank had agreed to cease operations in New York and give up its permit to have a branch there. Since 1978, the branch has been open for business.

The Department of Financial Services (DFS) of New York State severely criticized the bank at the time in a strongly worded press release, adding that “DFS will not stand by and let Habib Bank sneak out of the United States without holding it accountable for putting the integrity of the financial services industry and the safety of our nation at risk.”

HBL had become the target of an enforcement action by DFS for 53 separate violations allegedly committed between 2007 and 2017.

Neha Ayub
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