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BOC Sued for Wiring Terrorist Funds

08-25 11:36 Caijing Magazine

Terror victims filed a class action suit against Bank of China, alleging that they have helped fund terrorist activities since 2003.

By staff reporter Wu Ying 

More than 100 terror victims filed a class action lawsuit August 21 against the Los Angeles branch of Bank of China (BOC) for allowing millions of dollars to be wired by Hamas and the Palestine Islamic Jihad (PIJ). Hamas and PIJ are designated terrorist organizations by the U.S. government, and such wire transfers are a crime under American law. 

“BOC knowingly assisted Hamas and the Islamic Jihad in carrying out terrorist attacks with the full approval of the Chinese government, and they rejected requests by the Israeli government to cease and desist,” said the attorney for the plaintiffs, Nitsana Darshan-Leitner. Her clients demand that BOC “pay very heavily for its support for terrorism.” 

The plaintiffs allege that beginning in 2003, BOC executed dozens of wire transfers for the Hamas and PIJ totaling several million dollars. These dollar transfers were initiated by PIJ and Hamas leadership in Iran and Syria, were processed through BOC’s branches in the United States, and were sent on to a BOC account operated by a senior operative of the Hamas and PIJ in southern China’s Guangzhou City. If the accusation is true, BOC would have facilitated the funding of terrorist activities. 

In 2005, Israel counter-terrorism officers met with officials from the Chinese Ministry of Public Security and BOC regarding these wire transfers. Despite Israeli warnings, BOC persisted in wiring funds for Hamas and PIJ. 

Bank of China responded that no summons has been received from Los Angeles courts, nor have they received any investigation notice from counter money laundry organizations. Wang Zhaowen, a spokesman for BOC, said that BOC has been consistent in complying with laws and regulators at home and abroad, and have implemented appropriate risk control. 

Tang Xun, chief counter money laundry officer with the central bank, said the central bank should be on top of supervising Chinese banks operating overseas. But in this case, the central bank was uninformed and did no know the details. Tang said that Chinese banks should abide by local laws regarding money laundering, provided that the local laws are more rigid than their Chinese counterparts.

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