Allegations that Saudi Royal Family‑controlled National Commercial Bank (NCB) and BCCI funneled funds to al‑Qaeda and 9/11 hijackers

IN RE TERRORIST ATTACKS ON SEPTEMBER 11, 2001 787 Cite as 349 F.Supp.2d 765 (S.D.N.Y. 2005) make no claim that these individuals were acting on behalf of or at the behest of the Kingdom. See, eg. id. 1420 (claiming that in January 1999 Princess Haifa made payments to Al-Bayoumi, a Defendant al- leged to have paid rent on behalf of two of the hijackers). Finally, Plaintiffs allege that members of the Saudi Royal family provided support to al Qaeda in their offi- cial capacities as members of the Supreme Council of Islamic Affairs. Federal Com- plaint 19 426464. 4. National Commercial Bank NCB was established in 1950 by Salim bin Mahfouz, the father of Defendant Khalid bin Mahfouz, as the first commer- cial bank of Saudi Arabia. Ashton Com- plaint 1563; Burnett Complaint 188. The Ashton Plaintiffs allege that the bin Mah- fouz family controlled NCB until 1999 when the Saudi government bought a ma- jority of its shares. Ashton Complaint 1573.21 The Ashton and Burnett Plaintiffs claim that NCB has a wholly-owned sub- sidiary in New York, SNCB Securities, Ltd., through which it operates an interna- tional banking business. Ashton Com- plaint 1563; Burnett Complaint 1 88. Plaintiffs claim Osama bin Laden and al Qaeda used NCB as “a financial arm, oper- ating as a financial conduit for [their] oper- ations.” Ashton Complaint 1564; Burnett Complaint 189. In 1986, Khalid bin Mah- fouz became NCB’s President and CEO and remained so until 1999. Ashton Com- plaint 1563; Burnett Complaint 188. Also in 1986, Khalid bin Mahfouz became the Chief Operating Officer and a major shareholder of the Bank of Credit and Commerce International ““BCCI’). Ash- ton Complaint 11564, 566; Burnett Com- 21. The Ashton Plaintiffs moved to amend this allegation to claim that the Public Investment Fund (“PIF”), not the Saudi government, pur- chased a majority of NCB shares in 1999. Ashton Docket ## 137, 138. plaint 11.89, 91. He was subsequently in- dicted in New York state in connection with his involvement in BCCI’s fraudulent practices, which also implicated NCB. Ash- ton Complaint 11564, 566; Burnett Com- plaint 1189, 91. Plaintiffs claim both NCB and BCCI supported international terrorism. Ashton Complaint 19 564-68; Burnett Complaint 1791-93. Specifically, a “1999 United States Senate Report on the BCCI scheme detailed the role of [NCB] in hiding assets, money laundering, the cover-up and ob- struction of a Senate investigation, and sponsoring international terrorism.” Bur- nett Complaint 189. Additionally, a 1998 NCB bank audit revealed irregularities in- volving direct donations to several chari- ties and that $74 million had been funneled by the bank’s Zakat Committee to IIRO.” Ashton Complaint 9569-71; Burnett 19 94, 95. NCB also allegedly made loans to charitable organizations without the knowledge of the Zakat Committee. Jd. Plaintiffs allege “direct donations were re- ceived through NCB facilities to the Red Crescent Committee, [IIRO], and the Mu- waffaq Foundation,” all Defendants in these actions. Ashton Complaint 4570; Burnett Complaint 195. Muwaffaq alleg- edly provided Osama bin Laden with $3 million in 1998. Ashton Complaint 1573. Plaintiffs claim NCB knew or should have known it was materially supporting al Qae- da, Osama bin Laden, and international terrorism. Ashton Complaint 1570; Bur- nett Complaint 1 95. C. Defendants’ Status as States for FSIA Purposes The Court must first determine if the moving Defendants are “foreign states” for Foreign 22. Zakat is required almsgiving by all Mus- lims. See, e.g., Burnett Complaint at 275; id. 140. HOUSE_OVERSIGHT_017852