U.S. judge rules Bank of China can be sued in terrorism case

Judge Royce Lamberth of the U.S. District Court for the District of Columbia has allowed a lawsuit to proceed against one of China’s largest banks for allegedly helping finance the terrorist group Islamic Jihad.
 
The case was brought by the parents of Daniel Wultz, a 16-year-old from South Florida who was killed as the result of a terrorist attack while visiting Israel in 2006. Islamic Jihad claimed responsibility for the April 17 assault on a Tel Aviv restaurant—an attack that was financed through a Bank of China account in the United States, claim Yekutiel (Tuly) and Sheryl Wultz. David died in an Israeli hospital on May 16, 2006.

The unusual 118-page ruling came as Chief Judge Royce C. Lamberth of the U.S. District Court for the District of Columbia denied a request by attorneys for the state-controlled bank, one of China’s largest, to have it dropped from the case.

Victims of overseas terrorist attacks are increasingly turning to U.S. courts for restitution. Many are pursuing claims not only against shadowy groups or rogue nations but also against financial institutions with substantial economic interests to defend.

In the suit, Wultz’s parents, Yekutiel and Sheryl Wultz, are seeking $300 million in damages from Iran and Syria, as well as from the Bank of China (BOC), under legislation that allows victims to sue terrorist-sponsoring states in U.S. court.

The 2008 lawsuit alleges that officials at the Bank of China ignored warnings by senior Israeli officials that Islamic Jihad was financing deadly bombings through a Bank of China account in the United States maintained by a purported senior officer of the militant group, Said al-Shurafa.

Specifically, the lawsuit claims that in an April 2005 meeting, counterterrorism officials with Israel’s prime minister’s office demanded that China’s central bank and Ministry of Public Security stop the Bank of China from assisting Shurafa, but China “demurred.”

In weighing whether the claims against the bank can go forward, Lamberth wrote: “The Court must assume the truth of this allegation, which is plausible because it is reasonable to assume that, although BOC is not directly owned by China . . . China does exert a measure of control over the BOC through China’s central bank, the People’s Bank of China.”

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