The Case for Civil Suits Against Terror Sponsors
Terrorism – “a crime that has no equal”
Terrorism differs from other threats – in its capacity to generate global conflict; in its propagation of criminal enterprise; in its ability to inflict damage at a level once reserved only for sovereign entities; and in its pursuit of WMD[ii].
Whereas the primary interest of most criminals is personal gain of some sort, and not the destruction of themselves or society as a whole, the objective of terrorism is to undermine – if not destroy – the societies or countries they target. While criminals for the most part avoid large-scale massacres of uninvolved persons, the primary purpose of terrorist activity is to create victims – the more the better. So, while crime can exist without mass murder and may in fact benefit from avoiding it – terrorism cannot. And even if criminals or other miscreants were to aspire for whatever reasons to destroy society as a whole, rarely do they have the tools to do so.
The terrorist threat has been magnified by globalization which has generated a new partnership between terrorist bodies and organized crime – a nexus described by the U.S. DEA’s Chief of Operations Michael Braun as “representing “the most significant security challenge facing governments around the world.… [It is] no longer about crime rates. It is about global instability.”[iii]
The scope, intent, method and impact of terrorism clearly set it apart as a distinct category of transnational threat. The “special danger”[iv] it poses has been recognized as such in multiple UN Resolutions and by the Canadian courts which have determined that terrorist offences are “abnormal crimes”[v] – and that terrorism as a phenomenon is a “crime unto itself” that “has no equal…. [N]ot limited to, the senseless destruction of people and property … [i]t attacks our very way of life and seeks to destroy the fundamental values to which we ascribe – values that form the essence of our constitutional democracy.”[vi]
Terrorists are aware of the shortcomings and limitations of our domestic legal systems, and proactively exploit these gaps to their advantage.[vii] It will be up to legislators to find more creative and effective tools for contending with this challenge. This responsibility cannot be ignored or deferred. In the words of UN Secretary-General Ban Ki-moon: “Whether we like it or not our generation will go down in history as the one that was challenged to protect the world from terrorism”.[viii]
The Terror Economy
Despite the controversies surrounding counterterrorism policies and practices, the centrality of finance to the terrorist enterprise has been widely acknowledged by the international community. As former Department of Justice attorney Joseph A. Morris stated before Congress: “International terrorism has become, in many respects, an industry. It rests on a foundation of money….”[x] Courts that have presided over terrorism-related cases have concurred, concluding that: “There would not be a trigger to pull or a bomb to blow up without the resources to acquire such tools of terrorism and to bankroll the persons who actually commit the violence.”[xi]
The “terror economy” underpinning and underwriting the terrorist agenda, is driven by a complex network of state sponsors, criminal enterprise and non-state support from institutions and private donors – that annually generates billions of dollars of financial support for terrorist organizations across the globe. While terrorist attacks can require relatively small sums of money to execute, those operations are only the last link in a long causal line of hundreds of millions of dollars of investment to recruit and train members; purchase arms; provide logistical support; and sustain organizational infrastructure.[xii]
Cut the Fuel
As the fuel of global terrorism, money is a key weapon in the terrorist arsenal. But it is also creates an exploitable vulnerability.[xv] The financial machinery required for terrorists to manage, transfer and raise funds, can leave money trails and assist in documenting, exposing and dismantling the financial generators of the terrorist enterprise. According to experts, “counterterrorism officials place a heavy premium on financial intelligence” in part because “unlike information derived from human spies or satellite intercepts, which require vetting to determine their authenticity, a financial transfer is a matter of fact”[xvi] – in other words “money trails don’t lie[xvii].” Targeting terrorists funding then, can be as important as targeting their operational cells[xviii] – and any campaign to combat terrorism must entail the pursuit of its financial patrons, and the disruption of the support they provide. Interdicting even smaller amounts of terror cash can have a dramatic impact if the right accounts, companies or front organizations are shut down.[xix]
The Limitations of Existing International Efforts Against Terror Financing
While it has now become more difficult for terrorists to raise and transfer funds,[xx] experts have noted the limitations of the existing frameworks.[xxi] For Instance, the International Economic Sanctions Program, a central feature of the global effort to stem terror funding, has been plagued by inconsistencies in terrorist designations, listings, legal definitions, and the lack of cooperation and implementation in many countries – and has therefore met with only limited success.[xxii] There is no doubt that terrorist networks continue to retain their access to enormous financial resources, and have shown great dexterity in adapting to laws and policies aimed at curtailing their efforts.[xxiii]
In particular, the limitations of criminal prosecution have become abundantly clear. The complexity of terror finance cases, the high standard of proof required in criminal prosecutions and the cost and manpower expended in pursuing such cases[xxiv] has led to a dearth of prosecutions – and few convictions of real import.[xxv] Victor Comras, appointed by Kofi Anan to oversee Security Council measures against terror financing, outlined the difficulties encountered in the U.S. by prosecutors:
Since 9/11, the U.S. government has opened more than 108 material support prosecutions. We obtained jury convictions in only nine cases. We look pleas on lesser charges in another 42. We had to drop 46 cases for lack of sufficient evidence. Why? Because much of the evidence involved in these cases was highly classified and unusable in court. Eight defendants were acquitted and four cases were dismissed…. I do not cite these statistics as criticism but, rather, as an indication of the sheer difficulty… in establishing beyond a reasonable doubt the knowledge and subjective intent of those shielding their terrorism financing activities under the guise of charitable giving…. The message to the terrorists and to their funders is clear: The road is open and the risks are few.[xxvi]
Furthermore only a few of those who have been prosecuted are deep pocket donors[xxvii] while state sponsors of terror, shielded by sovereignty laws, have been completely beyond the reach of the law in almost all jurisdictions. The unfortunate result, as noted by Comras, is that: “Most major terrorism’s financial abettors and supporters…have successfully avoided criminal prosecution…. The record on closing down entities and institutions feeding terrorism is even more dismal.”[xxviii]
Harnessing Civil Suits Against Terror Sponsors
Criminal prosecution should remain an important tool in pursuing terrorists and their enablers. But given the inherent limitations and challenges in criminal prosecution and regulatory oversight, legislators should enact statutes allowing for the possibility of civil litigation against terror sponsors. Providing a civil option is consistent with the widely recognized principles and theories of tort law in providing a deterrent function against intentional attacks as well a corrective-justice function for the wrongs committed.[xxix]
The utilization of civil remedies in terrorism cases is also consistent with the formal declarations of the international community. Terrorism has been outlawed in every western legal system and has been criminalized in the major U.N. sponsored antiterrorism conventions, embodying the consensus of the international community against such acts.[xxx] Article 5 of the 1999 International Convention for the Suppression of the Financing of Terrorism stipulates that, “Each state party shall ensure … that legal entities liable in accordance with [provisions of the Convention] are subject to effective, proportionate and dissuasive criminal, civil, or administrative sanctions” – and Article 8 states that each signatory should consider establishing mechanisms whereby the funds from terrorism-related forfeitures are utilized to compensate the victims of terrorist offenses.
These suits have the potential to play a part in a comprehensive anti-terrorism strategy by providing an invaluable supplement and compliment to the criminal justice process[xxxi]– and can also fill a gap in anti-terrorism law and policy when military strikes or governmental sanctions are unfeasible; politically unpalatable, or lack multilateral support.[xxxii]
The Advantages of Civil Suits in Pursuing Terror Sponsors
Civil suits against terror sponsors have several advantages over criminal prosecutions:
- Holding wrongdoers responsible even where the criminal system has failed
- The criminal justice system requires an extraordinarily high burden of proof – the accused must be proven guilty beyond a reasonable doubt. However, the complexities of terror sponsorship – involving states, organized crime, front companies, charitable entities, and informal money transfer systems such as hawalas – often render this standard of proof difficult to attain.[xxxiii] In contrast, evidence in civil cases is weighed on “a balance of probabilities”. This standard is met if the proposition in question (whether the defendant is liable) is more likely to be true than not true. Therefore, credible evidence against a terror sponsor which may be insufficient for a criminal conviction, can be more than enough to establish liability in a civil proceeding.
- Civil proceedings are also governed by other procedural mechanisms (depending on jurisdiction) that would enhance the possibilities of successful judgments against terror sponsors. For example, the accused in a civil case can be compelled to testify and to turn over information – and the rules of discovery and hearsay in civil litigation cases are considerably broader.[xxxiv]Furthermore, the mens rea elements, proving a defendant knowingly contributed to the support of terrorist activity, may be more difficult to prove in a criminal trial. But proving this type of mental state under the broader standards of civil liability can be more practicable.[xxxv]
- Impairing the terrorist infrastructure and deterring future sponsorship through exposure
- These more flexible procedural standards increase the likelihood of successful judgments that can hold terror sponsors accountable, by seizing their assets; preventing their access to western markets; and exposing them to public scrutiny. Unlike many terrorist perpetrators who seek publicity and notoriety, the sponsors of terror tend to seek anonymity. These facilitators of terrorism fear transparency and exposure, and would be rendered vulnerable to both through civil suits. This potential for public exposure, combined with successful court judgments have the ability to bankrupt or financially impair the terrorist infrastructure, and effectively preempt and deter future acts of violence. For this reason experts like David Aufhauser[xxxvi] have endorsed the civil suit approach: “Private actions can be of material assistance to the government…. The bankers of terror are cowards. They have too much to lose by transparency. Name, reputation, affluence, freedom, status. They’re the weak link in the chain of violence. They are not beyond deterrence.”[xxxvii]
- Acting as a catalyst for government-led investigations and prosecutions.
- Civil suits can alert officials to illegal conduct that had not been previously detected. The Arab Bank case is such an example. Lawsuits seeking hundreds of millions of dollars in damages were filed in New York in 2004 against the Jordan-based Arab Bank for allegedly distributing compensation money to families of suicide bombers. These suits triggered a probe by U.S. regulators, and a Justice Department criminal investigation. The Arab Bank was then charged with failing to implement an adequate anti-money laundering program and failing to report suspicious activities.[xxxviii] Similarly, the successful suit against the Real IRA (RIRA) launched in 2001, also generated government action. Until the suit, RIRA had successfully eluded accountability for the 1998 bombing in Omagh Ireland, that took the lives of 29 people and injuring 220 others. After the civil action commenced, every named defendant was subsequently charged or taken into police custody.[xxxix] The suit also elicited the cooperation of witnesses who were unwilling to speak out during the criminal investigation.
- Setting the Record Straight – “an antidote to the obfuscation and political warfare accompanying the terrorist operations is perhaps half of the battle required in winning the war against terrorism.”[xl]
- A central feature of the civil justice system is the detailed determination of facts and a permanent record of these facts.[xli] And as noted by some scholars, civil suits may be more effective than criminal prosecution in establishing the full factual context in which the perpetrators committed their crimes.[xlii] The potential contribution of establishing the facts in cases related to terrorisms can be invaluable to the broader efforts against terrorism:
- [T]he experience in the United States, where we have had a lot of litigation against those who fund terrorism, is that in non‑frivolous cases there are committed public groups willing to get involved and that includes a broad spectrums of experts ‑‑ even beyond what often is available for the governments – from think tanks in the United States and overseas, and from academic institutions. Such cases bring together some of the best expertise, and some of the most valuable insights we have today on terrorism – particularly on financing of terrorism – this comes from the briefs that have been filed in these cases, some of which are phenomenal and the information incredibly detailed and valuable.[xliii]
- These suits therefore can also serve as a foil to the misinformation and political machinations surrounding the public debate on terrorism, and contribute to more substantive and accurate media coverage of these issues. The importance of the media arena for the terrorist agenda was pointed out by al-Qaeda leader Ayman al Zawahiri: “More than half of this battle is taking place in the media. And we are in a media battle for the hearts and minds of our Ummah.”[xliv] British attorney Jason McCue, the lawyer for the Omagh family members in their civil action against members of the Real IRA concurs. He notes that terrorists are adept at using the media for their own purposes: to intimidate the public, recruit new members, and to justify their actions. McCue correctly concludes that we “have no choice but to wage a public-relations war against the culture that sustains terrorism. That means inverting many of the images that the terrorist seeks to propagate and from which they gain benefit.”[xlv] Civil suits can make a valuable contribution in this effort.
- Beyond Compensation: Civil remedies as a “legislator’s form of a truth commission”[xlvi]– offering victims a measure of control.
- As noted above, civil suits may be more effective than criminal prosecution in establishing the full factual context of terrorist crimes. This enhances the prospects that victims will have their suffering brought to the attention of the wider community and that an accurate account of the atrocities will be provided:
- [C]ivil suits, controlled by plaintiff/victims and their chosen attorneys and not prosecutors responsive to other agendas, may also be more effective in preserving a collective memory that is more sensitive to victims than some judicial accounts rendered in the course of criminal trials….[xlvii]
- These suits also provide victims with a measure of control. Criminal proceedings are brought by the state or Crown, not by the victim, as criminal offenses are seen as offenses against society as a whole. Consequently, victims and their families have little or no control over how criminal proceedings are managed. They may be called as witnesses at trial and allowed to submit victim impact statements, but they are not a party to the proceedings. In contrast, the victims are a key party in civil proceedings, initiating the suits themselves. As plaintiffs, they choose whether to bring a claim forward, who their legal representation will be, and whether they wish to settle in advance or see the case through.[xlviii]
- Ending impunity for state sponsors of terror.
- In the case of state sponsors of terror, criminal prosecution will generally be impossible or impractical, making civil suits potentially the only viable remedy. As noted by Victor Comras: “Civil liability cases… associated with terrorism may constitute the best constraints we have against their activities and our best chances to hold them accountable.”[xlix]
- Summary: Civil suits can augment, or provide a meaningful alternative to, the criminal law process by:
- preempting attacks and impairing terrorist infrastructure through successful court judgments;
- deterring terrorism by causing terror sponsors to refrain from future sponsorship out of fear of the publicity and exposure that would result from a civil suit;
- holding wrongdoers responsible even where the criminal system has failed;
- compensating victims;
- acting as a catalyst for further investigation and prosecution of terror sponsors;
- enabling terrorist assets to be located and seized; and following judgment, prevent terror sponsors from accessing the banking and financial system.
[i] Plenary of MONEYVAL and Financial Action Task Force, Feb. 21, 2007
[ii] Rolf Mowatt-Larssen, director of intelligence for the Department of Energy, has contended that focusing on the WMD interests of al Qaeda alone would be a mistake, from the perspectiveof stopping a nuclear attack. “The sober reality,” Mowatt-Larssen cautioned, “is that the threat posed by nuclear terrorism is much broader than the aspirations of any single terrorist group.” Rolf Mowatt-Larssen, director, Department of Energy, Office of Intelligence and Counterintelligence, “The Strategic Threat of Nuclear Terrorism”(paper presented at a policy forum sponsored by the Washington Institute for Near East Policy, Washington, D.C., June 16, 2008). Available online(www.washingtoninstitute.org/templateC07.php?CID=404).
[iii] Michael Braun, “Drug Trafficking and Middle Eastern Terrorist Groups: A Growing Nexus?” (lecture sponsored by the Washington Institute for Near East Policy, Washington, D.C., July 18, 2008). www.washingtoninstitute.org/templateC05.php?CID=2914).
[iv] R v. Khawaja
[ix] Sept. 24, 2001
[xi] Boim v. Quranic Literacy Institute (7th Cir. 2002)
[xii] Unfunding Terror, Jimmy Gurule, Edward Elgar Publishing, 2008, P. 25-40
[xiii] The Middle East Forum. “Shutting Down Terrorist Financing” by David Aufhauser. Dec. 11, 2003. http://www.meforum.org/article/588
[xiv] Former General Counsel of the U.S. Department of the Treasury and Chair of the National Security Council’s Committee on Terrorist Financing
[xvii] Statement of Under Secretary Stuart Levey on the Terrorist Finance Tracking Program,” press release, June 23, 2006. Available online (www.treas.gov/press/releases/js4334.htm).
[xviii] Unfunding Terror, P.22
[xx] John A. Cassara, Former Intelligence Officer and Treasury Special Agent Before the House Homeland Subcommittee on Counterterrorism and Intelligence: “Terrorist Financing since 9/11: Assessing the Evolution of al Qaeda and State Sponsors of Terror”, May 18, 2012.
http://www.johncassara.com/index.php?option=com_content&view=article&id=36:testimony-house-homeland-subcommittee-on-counter-terrorism-and-intelligence-&catid=2:articles&Itemid=8; also see Terror Financing and State Responses, Stanford University Press 2007, P.293
[xxi] See Unfunding Terror P.381ff.: “While freezing of assets of suspected terrorists has been a central component of the global counterterrorism strategy since 9/11, each year fewer and fewer names are being submitted by States for inclusion on the U.N. Consolidated List…. The U.N. Sanctions Monitoring Team correctly notes that the ‘inconsistent relevance’ of the Consolidated List to the current terrorist threat is undermining the effectiveness of the sanctions regime…. …The U.N. sanctions program suffers from another serious deficiency. Even when names are submitted for designation, States are not freezing terror related assets. In fact the cumulative amount of frozen assets has been declining over the last few years. Thus according to every objective measurement, the international economic sanctions program is failing…..
Also see Mathew Levitt’s evaluation of international regimes against terror finance in:
Also see https://blogs.law.harvard.edu/mesh/2008/01/financial_war_on_terrorism/
for an evaluation of US and UN counter-terror-finance measures by Victor Comras, who served, under appointment by Secretary General Kofi Annan, as one of five international monitors to oversee the implementation of Security Council measures against terrorism financing
Also see Mathew Levitt inhttp://www.foreignpolicy.com/articles/2010/06/21/bank_shot?page=0,1:
“Like so many other aspects of the fight against terrorism, however, it’s extremely hard to objectively measure the extent to which this work has borne fruit. Matthew Levitt, a veteran of the U.S. Treasury who now works for the Washington Institute for Near East Policy, points out that there are virtually no reliable standards for gauging the success of efforts to counter terrorist finance. He says that the two “metrics” used most often in press coverage — the amount of money seized and the number of organizations officially designated as sources of funding — just don’t provide an accurate picture. In the years after 9/11, he notes, many of the Islamic charities that sponsored various Middle East terrorist organizations were shut down under U.S. pressure — only to reopen under new names within a matter of months or days.”
[xxii] Unfunding Terror , P. 273 ff; also see “Countering the Financing of Terrorism”, edited by Thomas Biersteker and Sue Eckerty, Routledge, 2008. P.12: “ Since 11 September 2001 … Treasury officials claim that $147 million worth of terrorist assets have been blocked or frozen worldwide…. [T]his might be viewed as an impressive achievement.… There are questions however about the reliability and significance of these figures. It is not clear whether they include funds frozen prior to 11 September 2001, particularly those funds of al Qaeda and of the Taliban frozen under UNSCR 1267 dating from October 1999, some of which have been release. If they do the $147 million figure is a somewhat more modest achievements. The figure also seems to be a cumulative amount, rather than the current amount of funds frozen.”
[xxiii] Civil Litigation Against Terrorism, Edited by John Norton Moore, Carolina Academic Press, 2004 P.140
[xxv] http://www.osen.us/index.php?id=58#_ftnref1; also see Unfunding Terror p.385
[xxvi] Testimony before the Senate on Bill S-225, June 19, 2008
[xxvii] Unfunding Terror, P.385
[xxviii]Counterterrorism Blog. “Civil Liability is Crucial in the War on Terrorism: A Response to the Wall Street Journal” by Victor Comras. October 30, 2006. http://counterterrorismblog.org/2006/10/civil_liability_is_crucial_in.php
[xxx] Civil Litigation Against Terrorism P. 5ff
[xxxi] Unfunding Terror, P. 324
[xxxii] Finding the Tort of Terrorism in International Law, Beth Van Schaack, Santa Clara University School of Law, http://digitalcommons.law.scu.edu/cgi/viewcontent.cgi?article=1409&context=facpubs
[xxxiii] Sheryl Saperia, “The Justice for Victims of Terrorism Act: A New Weapon in Canada’s Counterterrorism Arsenal”, Terror in the Peaceable Kingdom, Understanding and Addressing Violent Extremism in Canada, edited by Daveed Gartenstein-Ross & Senator Linda Frum, FDD Press, Washington D.C. 2012, P.121.
[xxxiv] In some cases conventions on discovery can be used “to obtain documents and other forms of evidence unavailable in criminal proceedings”. The primary relevant convention is the Hague Convention on the Taking of Evidence Abroad in Civil or Commercial Matters, see Civil Litigation Against Terrorism P.44 and fn. 24; Additionally, in the U.S. “a criminal jury verdict also requires the jurors to unanimously agree on the defendant’s guilt. A civil judgment may be based on less than a unanimous verdict”, see Unfunding Terror P.325
[xxxv] Civil Litigation Against Terrorism, P.140
[xxxvi] Former General Counsel of the U.S. Department of the Treasury and Chair of the National Security Council’s Committee on Terrorist Financing
[xxxvii] Jennifer Senior, “A Nation Unto Himself,” New York Times Magazine, Mar. 14, 2004.
[xxxviii] Glenn R. Simpson, “Arab Bank’s Link to Terrorism Poses Dilemma for U.S. Policy,” Wall
Street Journal, Apr. 20, 2005; Steve Perles & Gabriel C. Lajeunesse, “Policy Options for
the Obama Administration: The Foreign Sovereign Immunities Act as a Tool Against State
Sponsors of Terrorism,” presented at the University of Virginia Law School, Apr. 2009, P. 8.
[xxxix] Saperia, The Justice for Victims of Terrorism Act, P.122
[xl] Civil Litigation Against Terrorism, P. 8.
[xlii] Ibid P.44
[xliii] Victor Comras, Testimony before the Senate on Bill S-225, June 18, 2008
[xliv] Abdel Bari Atwan, The Secret History of Al Qaeda, University of California Press, 2006 P.85, quoted in Unfunding Terror, P.25
[xlv] Sheryl Saperia, The Justice for Victims of Terrorism Act, P.123
[xlvi] Civil Litigation Against Terrorism P170; Victor Comras quotes quoting Jeffrey Breinholt from the U.S. Department of Justice who amd e a similar observation:” I … believe these cases [civil suits against terror sponsors] reflect American law at its best, and that we should do everything we can
to encourage them. ….The conclusion emerges when these lawyers work on behalf of victims of
atrocities… …the findings go……into the case books. Remember, American judges have to find
factual support for the allegations, even if the foreign defendants never show up, which means there will always be facts developed and publicized. This means that the U.S. right now is simultaneously taking it upon itself — through its private lawyers — to run not one but several Truth Commissions.… (Comras, Testimony before the Senate on Bill S-225, June 18, 2008)
[xlvii] Ibid. P. 35
[xlviii] Saperia, The Justice for Victims of Terrorism Act, P.123
[xlix] Informal Remarks by Victor Comras, Counterterrorism Foundation Panel Discussion, Boim Case Reversal Problematical For Victims-of-terrorism Plaintiffs, January 28, 2008. http://counterterrorismblog.org/Comras-boimspeakingpaper12808.doc
[xlx]Debra M. Strauss is Associate Professor of Business Law at Fairfield University, where she teaches courses International Law, and Business Law and Ethics. Professor Strauss is also a member of the International Law and Ethics Sections of the Academy of Legal Studies in Business and an Adjunct professor of Law at Pace University School of Law.
[xlxi] “Enlisting the U.S. Courts in a New Front: Dismantling the International Business Holdings of Terrorist Groups through Federal Statutory and Common-Law Suits”, Vanderbilt Journal of Transnational Law. Volume: 38. Issue: 3. Publication Year: 2005. Page Number: 679)