Habib Bank Limited will fight allegations of the terror-financing case in the US.

According to Bloomberg on Thursday, Habib Bank Limited (HBL) is facing secondary liability in a case in the US after failing to refute allegations that it participated in a plot to launch assaults that killed or injured 370 plaintiffs or their family members and supported al-Qaeda terrorism.

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  • According to the Justice Against Sponsors of Terrorism Act, the biggest commercial bank in Pakistan might also be held accountable for supporting terrorism.
  • PSX’s stock price plunges.

According to Judge Lorna G. Schofield, who was quoted by Bloomberg, HBL, the largest commercial bank in Pakistan, is subject to secondary liability under the Justice Against Sponsors of Terrorism Act because it “aids and abets, by knowingly providing substantial assistance, or who conspires with the person who committed such an act of international terrorism.”

Al-Qaeda or one of the “syndicate FTOs,” which include Lashkar-e-Taiba, Jaish-e-Mohammed and its alter ego AlRehmat Trust, the Afghan Taliban, including the Haqqani Network, and the Pakistani Taliba, are among the organisations listed as foreign terrorist organisations under the Immigration and Nationality Act, according to the report, which quoted Judge Schofield.

According to the report, the plaintiffs also sufficiently establish that the bank was aware that its clients were “integral to al-overarching Qaeda’s campaign of terrorism, carried out directly and by proxy.” This proves that the bank had a widespread understanding of this fact.

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According to Schofield of the US District Court for the Southern District of New York, the allegations further demonstrate that the bank “knowingly and materially” assisted “al-Qaeda and its proxies dodge sanctions” and commit terrorist actions, satisfying the “knowing aid” criteria.

It is sufficient to demonstrate that Habib participated in a plot to carry out the attacks, Schofield said, to show that the bank “took deliberate steps to help customers evade international sanctions regimes, and in doing so incurred business risk that ultimately led to defendant’s expulsion from the U.S.”

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The report said that Schofield rejected the plaintiffs’ claims of primary culpability since none of the claimed banking services offered by Habib “were themselves acts of international terrorism.”

Habib Bank Limited Reply:

HBL responded to the development by stating that it is aware of the news story that Bloomberg has published.

On Thursday, its share price dropped by a maximum of Rs6.11 to settle at Rs75.36.

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In a message issued to Business Recorder after the market closed on Thursday, HBL stated that “the charges in the complaints are meritless, and HBL is defending them fully and forcefully.”

“It is abundantly clear from the public record that HBL is unwavering in its commitment to counteracting the financing of terrorism, and—as has been well documented—its extensive global implementation of anti-money laundering compliance controls has been highly successful and praised by regulators around the world.”

HBL claimed that the Court’s decision to dismiss the main liability claim and significantly restrict the case demonstrated the effectiveness of its motion in two different ways.

The court further indicated that secondary responsibilities will be assessed following proper legal proceedings and that no ruling had been made in this regard.

According to HBL, it proactively started a business transformation initiative around its control and compliance processes and systems in early 2018 to comply with international requirements.

“HBL has committed management time and resources to bolster its AML and CFT protocols by cooperating with worldwide specialists in this field.

The Bank aspires to adhere to the highest standards of Compliance with international and national laws and regulations.”

 

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