[Senate Hearing 111-858]
[From the U.S. Government Publishing Office]



 
                                                        S. Hrg. 111-858

   EVALUATING THE JUSTICE AGAINST SPONSORS OF TERRORISM ACT, S. 2930
=======================================================================

                                HEARING

                               before the

                    SUBCOMMITTEE ON CRIME AND DRUGS

                                 of the

                       COMMITTEE ON THE JUDICIARY
                          UNITED STATES SENATE

                     ONE HUNDRED ELEVENTH CONGRESS

                             SECOND SESSION

                               __________

                             JULY 14, 2010

                               __________

                          Serial No. J-111-100

                               __________

         Printed for the use of the Committee on the Judiciary


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                  PATRICK J. LEAHY, Vermont, Chairman
HERB KOHL, Wisconsin                 JEFF SESSIONS, Alabama
DIANNE FEINSTEIN, California         ORRIN G. HATCH, Utah
RUSSELL D. FEINGOLD, Wisconsin       CHARLES E. GRASSLEY, Iowa
CHARLES E. SCHUMER, New York         JON KYL, Arizona
RICHARD J. DURBIN, Illinois          LINDSEY GRAHAM, South Carolina
BENJAMIN L. CARDIN, Maryland         JOHN CORNYN, Texas
SHELDON WHITEHOUSE, Rhode Island     TOM COBURN, Oklahoma
AMY KLOBUCHAR, Minnesota
EDWARD E. KAUFMAN, Delaware
ARLEN SPECTER, Pennsylvania
AL FRANKEN, Minnesota
            Bruce A. Cohen, Chief Counsel and Staff Director
                  Matt Miner, Republican Chief Counsel
                                 ------                                

                    Subcommittee on Crime and Drugs

                 ARLEN SPECTER, Pennsylvania, Chairman
HERB KOHL, Wisconsin                 LINDSEY GRAHAM, South Carolina
DIANNE FEINSTEIN, California         ORRIN G. HATCH, Utah
RUSSELL D. FEINGOLD, Wisconsin       CHARLES E. GRASSLEY, Iowa
CHARLES E. SCHUMER, New York         JEFF SESSIONS, Alabama
RICHARD J. DURBIN, Illinois          TOM COBURN, Oklahoma
BENJAMIN L. CARDIN, Maryland
AMY KLOBUCHAR, Minnesota
EDWARD E. KAUFMAN, Delaware
               Hannibal Kemerer, Democratic Chief Counsel
                  Walt Kuhn, Republican Chief Counsel
                            C O N T E N T S

                              ----------                              

                    STATEMENTS OF COMMITTEE MEMBERS

                                                                   Page

Specter, Hon. Arlen, a U.S. Senator from the State of 
  Pennsylvania...................................................     1

                               WITNESSES

Bellinger, John B., III, Partner, Arnold & Porter LLP, 
  Washington, DC.................................................     8
Klingler, Richard D., Partner, Sidley Austin LLP, Washington, DC.     6
Kohlman, Evan F., Senior Partner, Flashpoint Global Partners, New 
  York, New York, and International Terrorism Consultant/Senior 
  Investigator, The NEFA Foundation..............................    17
Sofaer, Abraham D., George P. Shultz Senior Fellow, The Hoover 
  Institution, Stanford University, Stanford, California.........     2
Wolosky, Lee S., Partner, Boies, Schiller & Flexner LLP, New 
  York, New York.................................................    20

                       SUBMISSIONS FOR THE RECORD

Bill S. 2930.....................................................    25
Bellinger, John B., III, Partner, Arnold & Porter LLP, 
  Washington, DC, statement......................................    36
Burlingame, Debra, Washington, DC, letter........................    42
Klingler, Richard D., Partner, Sidley Austin LLP, Washington, DC, 
  statement......................................................    46
Kohlman, Evan F., Senior Partner, Flashpoint Global Partners, New 
  York, New York, and International Terrorism Consultant/Senior 
  Investigator, The NEFA Foundation, statement...................    65
Levitt, Matthew, Director, Stein Program on Counterterrorism and 
  Intelligence, Washington Institute for Near East Policy, 
  statement......................................................    76
Molinaro, Joan, Board Member of 9/11 Families for a Secure 
  America and Mother of New York City Firefighter Carl E. 
  Molinaro, New York, New York, statement........................    91
9/11 Families United to Bankrupt Terrorism, Washington, DC, joint 
  letter.........................................................    94
    Index of Exhibits 1-35.......................................    99
    Exhibits 1-35................................................   104
Sofaer, Abraham D., George P. Shultz Senior Fellow, The Hoover 
  Institution, Stanford University, Stanford, California, 
  statement......................................................   318
Voices of September 11th, New Canaan, Connecticut, letter........   336
Washington Post, Stuart Tayler Jr., July 14, 2010, article.......   338
Wolosky, Lee S., Partner, Boies, Schiller & Flexner LLP, New 
  York, New York.................................................   340


   EVALUATING THE JUSTICE AGAINST SPONSORS OF TERRORISM ACT, S. 2930

                              ----------                              

                   WEDNESDAY, JULY 14, 2010
                                       U.S. Senate,
                           Subcommittee on Crime and Drugs,
                                Committee on the Judiciary,
                                                    Washington, DC.
    The Subcommittee met, pursuant to notice, at 10:02 a.m., in 
room SD-226, Dirksen Senate Office Building, Hon. Arlen 
Specter, Chairman of the Subcommittee, presiding.
    Present: Senator Specter.

 OPENING STATEMENT OF HON. ARLEN SPECTER, A U.S. SENATOR FROM 
                   THE STATE OF PENNSYLVANIA

    Chairman Specter. Good morning, ladies and gentlemen. The 
Judiciary Committee hearing will now proceed on the Justice 
Against Sponsors of Terrorism proposed legislation. This is, I 
think, an unusual bill because it involves so many big issues. 
The first issue is the justice for victims and survivors of 
what is, arguably, the most barbaric act in human history. Hard 
to find something more astounding than the incident of 9/11. It 
has left the country scarred and really the world scarred, 
changed the face of America in many ways. One is the void in 
the Trade Towers, a historic site now; scarred my own State, 
Pennsylvania, in rural Somerset County; and has made this city 
into a virtual barricade and really much of the world.
    The second big issue which this legislation implicates is 
the use of a critical weapon to prevent a recurrence. The 
evidence is very, very forceful about the involvement of Saudi 
money in promoting terrorism. The 9/11 Commission Staff 
Monograph on Terrorist Financing said, ``Al Qaeda was funded to 
the tune of approximately $300 million per year by diversion of 
money from Islamic charities, confirmed that many of al Qaeda-
sponsored charities enjoyed significant Saudi Government 
sponsorship.'' So in a world where we are constantly threatened 
by al Qaeda and we have recurrent television appearances by bin 
Laden, we have really not taken a stand to stop that financing.
    A third very important issue--important in my mind--is to 
restore the balance on separation of powers. We have seen the 
Congress legislate on the Foreign Sovereign Immunities Act, and 
we have seen our legislation disregarded by the executive 
branch and then by the judicial branch. The Court of Appeals 
for the Second Circuit says that the act does not apply because 
the Saudis are not on the State Department list of state 
sponsors of terrorism. Well, as we all know, those of us who 
studied the bill, there are two ways: torts are excluded from 
sovereign immunity as well as those under state--on the list of 
those states who sponsor terrorism.
    The Solicitor General then opposes the grant of certiorari, 
disagreeing with the Second Circuit, but finding another 
reason, saying, well, the acts occurred--the alleged Saudi acts 
occurred outside the United States. Well, that is a curious 
rationale when you have the consequences in the United States.
    This is one of a long line of matters where the Supreme 
Court has refused to take up issues on the executive-
Congressional balance. Another notable one is the conflict 
between the President's assertion of Article II powers as 
commander in chief with the Terrorist Surveillance Program and 
the Foreign Intelligence Surveillance Act, which specifies the 
only way you can invade privacy on wiretaps is with a court 
order. That has come up in the Kagan hearings and is a matter 
of considerable concern as to what the Court will decide.
    I filed legislation to compel the Court to take the 
Terrorist Surveillance Program, and it is an issue in the 
confirmation proceedings as to the standards on taking those 
matters. Congress has the authority to mandate that the Court 
take certain cases, as we did with flag burning and McCain-
Feingold, and we can do that here as well.
    Well, that brings us to a very, very distinguished group of 
witnesses: Judge Abe Sofaer, Mr. Richard Klingler, Mr. John 
Bellinger. And I would ask you gentlemen at this time to stand 
for the traditional administration of the oath. Do you affirm 
that the testimony you are about to give before this Committee 
will be the truth, the whole truth, and nothing but the truth, 
so help you God?
    Judge Sofaer. I do.
    Mr. Klingler. I do.
    Mr. Bellinger. I do.
    Chairman Specter. Thank you.
    Our first witness is former Federal Judge Abraham D. 
Sofaer, now a fellow in foreign policy and national security 
affairs at the Hoover Institution on War, Revolution, and Peace 
at Stanford University; served as the distinguished legal 
adviser to the U.S. Department of State from 1985 until 1990 in 
the administrations of President Reagan and George H.W. Bush; 
for 6 years, from 1979 to 1985, he was a federal judge, 
Southern District of New York; author of a book, ``War, Foreign 
Affairs and Government''; bachelor's degree from Yeshiva 
University and law degree from New York University School of 
Law; clerked for Justice Skelly Wright on the D.C. Circuit and 
later Supreme Court Justice William Brennan.
    Thank you for coming in today, Judge Sofaer. We know you 
have a plane to catch, and we look forward to your testimony.

 STATEMENT OF HON. ABRAHAM D. SOFAER, GEORGE P. SHULTZ SENIOR 
FELLOW, THE HOOVER INSTITUTION, STANFORD UNIVERSITY, STANFORD, 
                           CALIFORNIA

    Judge Sofaer. Chairman Specter, it is a particular pleasure 
to be here with you. It has been a privilege to work with you 
on many issues over the years, and this is no less important 
than any of the others we have looked at together. And if I can 
be of any help, I am glad to do so.
    Chairman Specter. Thank you.
    Judge Sofaer. I will go through my testimony very quickly 
so that I meet your time limit, and it can be read later on. 
This is a really important issue, and I commend you and the 
Committee for looking at it. Sponsoring killings of Americans 
on American soil should be taken extremely seriously, and we 
should do the best we can at holding people responsible who do 
that knowingly or recklessly.
    I agree with the premise of S. 2930 that civil actions for 
damages may deter some sponsors of acts of terrorism. But no 
one knows better than you, Senator, and the members of this 
Committee, that the effort to create viable, civil penalties 
against terrorists and their sponsors in the U.S. courts has 
been frustrating and largely ineffectual. The executive branch 
of our own Government, regardless of party, has opposed the 
effort and has sought largely successfully in the U.S. courts 
to limit the effectiveness of the laws Congress has adopted for 
this purpose.
    This difficulty in fashioning effective remedies that both 
compensate victims and deter people who support these acts 
stems not from any lack of ingenuity or resolve on the part of 
this Committee or the U.S. Congress--and, incidentally, I do 
not think it stems either from any sense of perversity or lack 
of sympathy by executive officials--but, rather, from the 
inherent difficulties and dangers that arise when one state 
unilaterally attempts to modify important aspects of the law 
relating to sovereign immunity.
    So with your permission, I will touch on some of the key 
aspects of the bill, but I would like to go on and suggest an 
alternative mechanism that might be a more satisfactory way to 
achieve these important objectives.
    The proposed bill deals with at least four major issues, 
and I think in large part very effectively. The Samantar 
decision has at least potentially taken care of the issue of 
whether the FSIA applies to officials, and it says no.
    Now, you, I am sure, will modify the legislation to 
accommodate that ruling of the Supreme Court, but there is a 
fundamental issue to be decided, and that is, do you want to 
have the State Department make all these decisions? I 
personally think they will fall victim to the same kind of 
political pressure that they fell victim to when they were 
making decisions about the immunity of states. And so Congress 
might consider creating special rules and laying out the 
standards that it thinks that the courts or, if you want the 
State Department to do it, the State Department should apply in 
deciding those very difficult questions. So I think there is 
really important work to do about what to do in dealing with 
claims by officials.
    Since I only have a minute here, Senator, let me say that 
in addition to my specific comments about the bill, I would 
recommend that this Committee consider creating a compensation 
program that does not turn on the type of terrorist action, the 
evidence of state involvement, and issues of that kind, and 
compensates all Americans injured in a certain set of actions, 
and then allows the Government to pay those claims, first of 
all, and then to take those claims and to seek that money from 
other governments. And, Senator, you will see at the end of my 
statement my plea for a strong diplomacy as opposed to the kind 
of diplomacy we so often see when it comes to dealing with 
people who sponsor terrorist acts in America.
    Once it is established that certain groups--or princes, for 
that matter--have knowingly funded the killing of Americans on 
American soil, we need to do more than just let people pursue 
them in the courts. That is what we did with Osama bin Laden, 
and he killed Americans five times over before we finally got 
around to going after him.
    We need to go after these people. We need to use preventive 
force. And in my paper I recommend, Senator, that any bill, in 
setting up this funding requirement, should include an 
authorization for the President under appropriate circumstances 
to use force against the sponsors of terrorism of this kind. 
And I refer you to Security Council Resolution 1373 that lays 
out the criteria which the Security Council has said justifies 
a criminalization of assistance to terrorist groups and those 
criteria would justify far more serious actions than simply 
civil actions against people who sponsor these acts.
    Senator, just for your information, I will send you a copy 
of a book on preventive force I published about a month ago. I 
will be happy to send that if it helps with the Committee's 
deliberations about actually fashioning something more muscular 
and more effective to deal with this unacceptable attitude that 
people who may happen to be princes, or whatever, can actually 
give money knowingly to a group that is devoted to the killing 
of Americans.
    Thank you.
    [The prepared statement of Judge Sofaer appears as a 
submission for the record.]
    Chairman Specter. Well, you raise some fascinating 
alternatives. When you mention criminalization after talking 
about using force, and you talk about the Saudi princes, are 
you suggesting that the United States ought to pursue 
criminally against those who are identifiable and seek their 
extradition?
    Judge Sofaer. Yes, I certainly am, Senator, because if you 
look at Resolution 1373, it says that state has the duty to 
prevent and repress the financing of terrorist acts. Section 
1(b) says that every state must criminalize the willful 
provision of collection by any means, directly or indirectly, 
of funds by their nationals or in their territories with the 
intention that the funds should be used, or in the knowledge 
that they are to be used in order to carry out terrorist acts. 
And this is just one of several provisions that I think would 
justify that.
    Chairman Specter. And when you talk about the use of force, 
are you suggesting that the United States take military action 
against the Saudi Government?
    Judge Sofaer. I do not think that would be necessary, 
Senator, for us to take action against the Saudi Government. 
But I think as a matter of principle it is perfectly 
appropriate for the Congress to indicate to the President that 
a government that either refuses to abide by the requirements 
of Resolution 1373 or just simply cannot do so, forfeits its 
right to maintain complete sovereign integrity of their 
territory.
    Chairman Specter. And if they do not extradite these Saudi 
princes, then what with respect to your suggestion of U.S. 
force?
    Judge Sofaer. Well, I mentioned, Mr. Chairman, in my 
written testimony that we should not be having more 
Afghanistans as a price for our self-defense. I do feel that we 
have the capacity now to go after individuals in countries that 
are killing Americans and to stop them.
    I am not talking about guessing about people that might 
kill Americans. As you know, Senator, there are people out 
there who have very deliberately killed Americans over and over 
again. And what the administration is doing today through the 
CIA by targeting individuals in various countries of the world 
is lawful and just, as far as I am concerned.
    Chairman Specter. Well, you have moved quite far afield on 
your testimony.
    Judge Sofaer. I am just trying to achieve the objectives of 
the Committee.
    Chairman Specter. When you talk about the executions which 
the United States has ordered, having identified terrorists who 
they conclude have killed Americans, it is extrajudicial, but 
depending upon the circumstances, I would agree with you that 
it is warranted. But that is pretty far afield. I do not think 
we are going to use drones against Saudi princes. Are you?
    Judge Sofaer. Well, I think it is a matter of principle, 
and if the Committee were to pass a comprehensive bill that, in 
addition to fixing these aspects of civil suits, set up a 
compensation fund and at the same time encourages the President 
to do something effective about deterring these attacks on 
Americans, and the funding of these attacks, I think that 
people around the world would take more seriously the fact that 
finally officials of the Government of the United States are 
fulfilling their oath, Senator, to protect and defend the 
people of the United States.
    Chairman Specter. Well, when you talk about the fund, that 
is really quite different from what you are suggesting with 
respect to criminalization and force. This reminds me of the 
debates we had when you were counsel to the State Department. 
It is surprising to note that we did not have extraterritorial 
jurisdiction when I was elected in the Senate, and it was only 
in 1984 as to kidnapping and hostage taking that we legislated 
extraterritorial jurisdiction, then the Terrorist Prosecution 
Act in 1986, following the strafing of the Rome and Vienna 
airports. Then at that time, the United States could not get 
other countries to turn over terrorist suspects. And we talked 
about a case in about 1870 where the Supreme Court upheld the 
prosecution of an Illinois matter where they had kidnapped 
somebody in Peru. The Supreme Court said it was okay. And we 
talked about using that as authority for taking people into 
custody.
    Your thinking has gone quite a bit farther in the 
intervening 25 years, Judge Sofaer.
    Judge Sofaer. I think you have been a leader, Mr. Chairman, 
at sensing that the world is moving in the direction of 
civilized order, and I think that your sense of it has been 
correct. And if we even live in a civilized world, it would be 
one in which no Saudi prince or any other prince could safely 
fund the killing of innocent civilians in any other country. I 
think you agree with that.
    Chairman Specter. Well, your testimony, Judge Sofaer, has 
gone quite a bit farther than the structure of this bill. You 
make this bill look very, very modest, perhaps even 
ineffective, the grand scope that you are proposing. But we 
will settle for a little less, at least so far as this hearing 
today is concerned.
    Judge Sofaer. Thank you.
    Chairman Specter. I have deviated from regular order in 
questioning Judge Sofaer beyond his time before the panel is 
finished because he has a plane to catch, as I mentioned 
earlier, and this is a very busy day with many, many hearings, 
so I do not know how many people will be present. We have two 
members of the Committee who are cosponsors--Senator Lindsey 
Graham and Senator Charles Schumer--and I know they want to be 
present. But until they arrive and we have more participants, 
we have the luxury of being a little more flexible than we 
customarily do.
    I will now turn to the testimony of Mr. Richard Klingler, 
partner at Sidley & Austin; from 2006 to 2007 was general 
counsel and legal adviser on the National Security Council 
staff. Two years earlier, he had been in the Office of Counsel 
to the President. A.B. from Stanford, a B.A. from Oxford, a law 
degree from Stanford, and clerked for Justice O'Connor.
    Thank you for joining us, Mr. Klingler, and the floor is 
yours.

 STATEMENT OF RICHARD D. KLINGLER, PARTNER, SIDLEY AUSTIN LLP, 
                         WASHINGTON, DC

    Mr. Klingler. Thank you, Mr. Chairman, and thank you for 
inviting me to present my views regarding the Justice Against 
Sponsors of Terrorism Act. My written testimony elaborates 
these comments.
    The Act is an important counterterrorism initiative and 
focuses on redressing injuries arising within our borders. The 
Act is required in large part due to the Second Circuit's 
unfortunate and clearly erroneous construction of the Foreign 
Sovereign Immunities Act and application of the Due Process 
Clause. The Act is also required by the administration's recent 
narrow construction of the Immunity Act's exception for suits 
addressing tortious acts, including acts of terrorism.
    The administration put forward its position in a brief 
filed by the Solicitor General that advised the U.S. Supreme 
Court not to review the Second Circuit's decision or consider 
the September 11th victims' arguments, even as the Government 
disagreed with each of the key aspects of the Second Circuit's 
reasoning.
    The Second Circuit's approach would bar suits against 
foreign sovereigns for acts of terrorism unless the sovereign 
was among the handful of formally designated state sponsors of 
terror, and it would require courts to decline jurisdiction 
over claims against non-state actors abroad who support 
terrorist organizations hostile to the United States. The 
administration's interpretation of the current statute would 
bar suits against nearly all foreign states for supporting an 
act of terror against and within the United States whenever a 
portion of that state support took place outside our borders. 
Both approaches would bar suits against foreign governments 
related to attacks such as those completed by the September 
11th hijackers or attempted by the Christmas Day bomber or the 
Times Square bomber.
    The Second Circuit's approach would also bar a range of 
claims by terrorism victims against nongovernmental supporters 
of terrorist organizations.
    The principal provisions of the Act are designed to remedy 
these gaps in our counterterrorism capabilities. The Act would 
ensure that suits could proceed against a foreign state when it 
acted abroad to support acts of terrorism directed toward the 
United States and causing injury within our borders. It would 
express Congress' understanding that supporters of terrorist 
organizations directing their actions against the United States 
should expect to be pursued in U.S. courts, and it would 
confirm that civil suits can be pursued against those who 
support terrorist organizations as well as those who commit the 
terrorist act.
    The enhancements of our counterterrorism capabilities in 
the Act would advance a range of interests. The Act would 
increase the ability of victims of acts of terrorism committed 
on U.S. soil to secure redress and hold terrorist supporters 
accountable. There is value in permitting the victims of such 
acts to have their day in court, to prove the facts of the 
violence done to them and us, and to bring public scrutiny upon 
those who harmed them. This applies not only to the victims of 
past acts of terror, but also those who are, unfortunately, 
likely to join their ranks. It applies to those who would 
foster and support terrorist organizations, even if they are 
associated with a foreign government, as well as those who more 
directly commit acts of terror. To the victims of terrorism 
harmed in the United States, it does not matter whether the 
person who writes the check that funds the attack does so in 
Miami or in the Middle East, and it should not matter to our 
courts.
    The Act would also increase the Nation's ability to deter 
and prevent further attacks of terrorism. Although civil 
litigation plays a relative small part in countering terrorism, 
its role is not unimportant. The Act would increase the scope 
of civil litigation directed against those who support 
terrorism. This may prove especially effective when directed 
against financiers of terror, conscious of their reputations, 
and by providing incentives to foreign states to ensure that 
those closely affiliated with them neither seek to harm 
expatriate communities within the United States nor further the 
effort of terrorist organizations.
    There are always risks to our Nation's foreign relations 
and potential conflict with international legal principles when 
civil liability is expanded against foreign sovereigns and for 
acts undertaken abroad. But those risks must be set against the 
benefits of the Act and set in context. Here those risks are 
lessened because the Act is focused on injury occurring within 
this Nation's borders where our sovereign interests are 
greatest and the tension with international legal principles 
reduced. Indeed, Section 1605(a)(5) supported certain 
terrorism-based claims against sovereigns in the decades prior 
to the Second Circuit's narrow construction without undue 
harmful effects. Those risks are further reduced by additional 
provisions of the Act, by legal principles available to the 
judiciary to accommodate the interests of sovereigns, and by 
measures the executive branch may take to manage risks to 
foreign relations in particular cases.
    There are, in addition, clarifications of the Act's 
sovereign immunity exception that may further reduce these 
risks, especially in relation to limiting recovery for injuries 
unrelated to acts of violence and terrorism occurring directly 
in the United States. Permitting recovery for that unrelated 
injury could indeed bring unintended consequences or increased 
risks to foreign relations. Even so, that concern presents 
little difficulty for the important provisions of the Act 
addressing Federal courts' jurisdiction over non-state actors 
or for the provisions confirming that suits can be predicated 
on allegations of secondary liability. And even for the Act's 
revisions of sovereign immunity, that concern should not cause 
hesitancy but, rather, prompt clarification and confirmation of 
the Act's core, important purpose of extending the scope of 
remedies for victims of international terrorism directed 
against and causing injury in the United States.
    Thank you for the opportunity to present the views.
    [The prepared statement of Mr. Klingler appears as a 
submission for the record.]
    Chairman Specter. Thank you, Mr. Klingler.
    Our third witness, the final witness on this panel, is John 
Bellinger, a partner in Arnold & Porter; served as legal 
adviser to the Department of State from 2005 to 2009; had also 
served as legal adviser to the National Security Council 2001 
to 2005; and represented the White House in dealings with the 
9/11 Commission. He served as counsel for national security 
matters in the Criminal Division of the Department of Justice, 
was counsel to the Select Committee on Intelligence in 1996, 
the year that I chaired that Committee; and was special 
assistant to CIA Director William Webster; AB from Princeton, a 
law degree from Harvard, and a master's in foreign affairs from 
UVA.
    Thank you for coming in, Mr. Bellinger, and we look forward 
to your testimony.

 STATEMENT OF JOHN B. BELLINGER III, PARTNER, ARNOLD & PORTER 
                      LLP, WASHINGTON, DC

    Mr. Bellinger. Mr. Chairman, thank you very much for having 
me today. I had the privilege, as you mentioned, of serving as 
counsel to the Senate Intelligence Committee in 1996 when you 
were the Chairman, so it is a particular honor for me to appear 
before you after the year of having served behind you. It is 
nice to be back.
    As you noted, I have served in the Justice Department, at 
the National Security Council, and most recently as the Legal 
Adviser at the State Department. It is nice to be here with my 
distinguished predecessor Abe Sofaer and my successor at the 
White House, Richard Klingler.
    I have spent a considerable amount of time working on the 
issues that today's hearing is considering. I agree 
wholeheartedly with the goal of the proposed legislation, which 
is to hold accountable countries and certain individuals and 
entities who sponsor acts of terrorism. I was in the Situation 
Room on 9/11, and I spent much of my time at the White House 
and the State Department after 9/11 on issues relating to the 
9/11 attacks. I have met with many of the families of the 9/11 
attacks as well as of other terrorist attacks, so I share your 
goal of seeking justice for these atrocities.
    I have a longer statement for the record. I am just going 
to make a few comments right now. I am not going to take a 
position for or against the amendments, but what I would like 
to do is highlight a few factors for the Committee's 
consideration, focusing in particular on the amendments to the 
Foreign Sovereign Immunities Act.
    In general, I would urge Congress to be very careful in 
proposing new exceptions to the Foreign Sovereign Immunities 
Act. The FSIA codifies very important principles of 
international law that protect not only foreign governments 
but, more importantly, the United States itself. Long before 
the FSIA was enacted, our courts recognized that under 
international law, sovereign governments are immune from suit 
in each other's courts. When the terrorism exception was added 
to the FSIA in 1996, it reflected a very delicate compromise 
between the Congress and the executive branch limiting suits 
against foreign governments only to the seven, now four, state 
sponsors of terrorism designated by the executive branch. And 
even the terrorism exception is not consistent with generally 
accepted principles of international law. Because it is 
included in U.S. law, the U.S. is unable to become party to an 
important multilateral treaty, the U.N. Convention on State 
Immunities, which the U.S. itself was instrumental in having 
adopted and which protects the United States from suits around 
the world.
    The Committee needs to be very careful about unintended 
consequences of this legislation. In particular, the provision 
expanding the tort exception, drafted with specific countries 
in mind--and we have mentioned Saudi Arabia--could potentially 
be used against other nations, including U.S. allies, like 
Israel, if the tort results in personal injury or loss of 
property in the United States. Lawsuits have already been 
brought against Israeli officials in U.S. courts for alleged 
extrajudicial killings in Gaza, and this bill could potentially 
remove the immunity of the state of Israel itself, as well as 
of all other nations. Expanding the tort exception could open a 
Pandora's box of litigation against foreign governments in U.S. 
courts. But even if some of these frivolous lawsuits are 
dismissed, allowing them to be brought in the first place could 
result in protracted litigation against our allies.
    Congress should also consider the possible reciprocal 
consequences for the United States itself. When the terrorism 
exception was added to the FSIA in 1996, Iran and Cuba removed 
U.S. sovereign immunity and allowed the U.S. to be sued in 
their courts for terrorism resulting in billions of dollars in 
default judgments against the United States. And U.S. officials 
have already been subject to legal actions in other countries 
for their official actions to combat terrorism. At a time that 
the United States is necessarily taking important but 
controversial actions around the world to fight terrorism--and 
Judge Sofaer has mentioned some of those earlier--Congress 
should be extremely cautious about lifting the immunity of 
foreign governments lest foreign governments remove the 
immunity of the United States in their own courts.
    Finally, Congress should also consider the possible foreign 
policy friction that would result from allowing more foreign 
governments to be sued in the United States. This might require 
the executive branch to intervene to prevent our Federal courts 
from becoming embroiled in delicate foreign policy and 
political questions. These kinds of interventions by the 
executive branch are exactly the kinds of actions that the FSIA 
was enacted to avoid.
    Mr. Chairman, I appreciate the chance to appear to discuss 
these concerns. I commend the Committee for its efforts to seek 
justice for victims of international terrorism. I look forward 
to discussing some of the alternative proposals that Judge 
Sofaer has suggested and that I have worked on when I was The 
Legal Adviser sitting in his chair, as well as the Committee's 
efforts to consider these important principles of international 
law and foreign policy.
    Thank you.
    [The prepared statement of Mr. Bellinger appears as a 
submission for the record.]
    Chairman Specter. Well, thank you, Mr. Bellinger. There 
certainly are a great many issues on the floor. I begin with 
the proposition that this legislation does not seek to add any 
additional exceptions. We are simply dealing with the ones at 
hand.
    And, Mr. Klingler, you testified at some length in your 
written statement--and all the written statements will be made 
a part of the record, without objection--about specifying that 
there are alternative remedies. The countries listed on the 
nations which sponsor terrorism is separate from the tortious 
conduct. And you believe, as I understand it, that the 
legislation is correct in seeking to overturn both the Second 
Circuit decision and the position taken by the State Department 
and urging the denial of cert.?
    Mr. Klingler. Yes on both points. The Second Circuit was 
clearly wrong in indicating that the existing statutory 
provision for suits and torts against sovereign was incapable 
of supporting a terrorism-related suit, and the proposed 
legislation would confirm and clarify that that position is 
wrong and would confirm that terrorism-related suits can be 
brought within the tort exception to the Foreign Sovereign 
Immunities Act. Even the administration disagreed with the 
Second Circuit's reasoning on that point.
    Chairman Specter. Mr. Bellinger, you raise a concern about 
having litigation like allegations of criminal conduct against 
the Israeli Army in Gaza. We do not really get anywhere near 
that kind of a problem with what we are proposing to do in this 
legislation, do we?
    Mr. Bellinger. I am not saying, Senator, that such a suit 
would have merit, but I am afraid that by expanding the tort 
exception to apply it clearly to extraterritorial acts outside 
the United States, contrary to what the Second Circuit had 
said, and specifically stating that it applies to something 
like extrajudicial killings, that would allow at least a suit 
to be brought against Israeli, or other countries like 
Afghanistan or even Britain. Admittedly, the effect has to be 
felt inside the United States, but there are a lot of creative 
lawyers who I think could plead that sort of effect.
    Right now, Israel and other countries are immune from those 
kinds of suits as sovereign governments in the United States. 
There has been litigation against Israel and against its 
intelligence services for directing, in fact, air attacks in 
Gaza because it had effects inside the United States. Those 
officials were ultimately held to be immune under principles of 
common law immunity.
    Chairman Specter. Isn't it pretty far-fetched to analogize 
an attack in Gaza as having an effect in the United States 
contrasted with what we are dealing with here?
    Mr. Bellinger. Ultimately, that case was dismissed in the 
U.S. courts against Israeli officials, but it took Israel a 
very long time to have to defend it, many, many years up 
through the circuit courts. Israel had to defend its officials 
previously for actions taken solely in Gaza that were alleged 
to have effects here in the United States. So I would be very 
concerned about lifting the immunity not only of officials but 
of whole states potentially to be sued here in the United 
States for their extraterritorial actions.
    Chairman Specter. When you talk about foreign policy 
functions and the Government would have to intervene in a lot 
of lawsuits, that is exactly what the Government has done here 
in a way which is really not known to the public. There is very 
little awareness as to what goes on in a case like this or most 
of the cases in the Supreme Court of the United States. It has 
to be a case like Bush v. Gore or a case like Citizens United 
before there is any public understanding.
    One of the collateral issues that I have been working on 
for a couple of decades has been the issue of televising the 
Supreme Court so that people will understand the far-reaching 
impact, but what you warn against is Government intervening in 
litigation. That is exactly what happened in this case. And how 
do you effectively deal with that?
    Mr. Bellinger. Well, I think it depends on what side of the 
issue you are, whether you think it is a proper or improper 
intervention. For example, in the Israeli case that I mentioned 
against the Israeli intelligence chief. The Legal Adviser--and 
the United States, in fact, intervened in that case. We filed a 
brief, which I signed, stating that the case should not be 
heard in the United States because it was an improper political 
question to be heard inside the United States. And certainly 
the victims in that case felt that the United States was 
improperly intervening against them. So it depends what side of 
the issue you are on to determine whether it is an improper 
intervention.
    In something like this, if more cases were allowed to be 
brought against foreign governments in the United States, there 
would be pressure from both sides--both the victims, 
understandably, but also the representatives of the foreign 
government--saying that whatever the case happens to be is a 
delicate political question that should not be left to the 
judiciary to consider. And I am not saying that any future 
government would file a brief, but there would be tremendous 
pressure upon them----
    Chairman Specter. What happened in that case? The court 
made a decision?
    Mr. Bellinger. This was called the Dichter case, which was 
brought against the Israeli intelligence chief----
    Chairman Specter. The one you are describing. Which court 
were you in?
    Mr. Bellinger. This was in New York, the New York district 
and then the court of appeals, and there was another case, I 
think, that was also in D.C.
    Chairman Specter. And the court decided those cases. Was 
there----
    Mr. Bellinger. The court decided those cases and found that 
the officials were not immune under the Foreign Sovereign 
Immunities Act because the courts held that officials are not 
protected under the Foreign Sovereign Immunities Act which they 
said protects governments.
    Chairman Specter. Was there a cert. application?
    Mr. Bellinger. I believe there was. I would have to check 
on that. The courts, though, held that the officials were 
immune under common law principles of immunity that protect 
officials in their official acts, which is just what the United 
States would expect overseas. If the Secretary of Defense right 
now were sued in a foreign country for a drone attack that 
killed civilians, we would assert very strongly that our 
Secretary of Defense was absolutely immune from those actions 
because he took them in his official capacity, even though the 
civilians in, for example, Afghanistan or Pakistan or Yemen 
would believe that that was actually an illegal extrajudicial 
killing.
    Chairman Specter. Well, coming back to this legislation and 
the case which has provided the basis for the legislation, the 
cases you cite are interesting, but the serious question as to 
whether they are really relevant here on the facts being so 
vastly different and what might be postulated with a lot of 
imagination could be handled in some other court at some other 
time. But it is different to say the court is going to decide 
whether the Foreign Sovereign Immunities Act applies in this 
case or the Court saying, ``We will not take the case.''
    You have not taken a position on the legislation. Would you 
take a position that at least the Supreme Court should have 
granted cert. and decided whether the Second Circuit was right, 
whether the Solicitor General was right, and reached an 
interpretation of the statute?
    Mr. Bellinger. I would have liked to have seen the Supreme 
Court take the case. It was an important case involving the 
interpretation of the Foreign Sovereign Immunities Act, and I 
would have liked to have seen the Supreme Court's views on the 
subject. I do not know how they would have come out.
    Chairman Specter. Well, nobody knows how they would come 
out, but if we at least take Mr. Klingler's recommendation to 
take care of the loose ends on the Second Circuit decision and 
on the Solicitor General's argument, then we would know.
    Judge Sofaer, how do we deal with this issue of lack of 
public understanding as to what is involved here and the 
extraordinary weight given to the Solicitor General's view? The 
Supreme Court always asks for it, and the way that 
Congressional power has been so drastically curtailed by the 
Court, there are many other issues which are raised on fact 
finding and on other cases where the Court declines to 
intervene or overrules the Congressional action for what 
Justice Scalia called ``the flabby test'' on congruence and 
proportionality, giving up the rational basis standard. But all 
of this is so far removed from the public view. How would you 
deal with that?
    Judge Sofaer. I think you are doing an admirable job, 
Senator. I was stunned when I saw what the Second Circuit held 
and what the Solicitor General said about the standard of proof 
that would be required to find that a tort had occurred in the 
United States that satisfied the requirement of the statute. 
The notion that you can have a separate tort that occurs, let 
us say, in Saudi Arabia of knowingly funding an attack in the 
United States and thereby evade the statute that governs the--
--
    Chairman Specter. Come to the core, Judge Sofaer. In your 
judgment, is there any conceivable basis for that conclusion?
    Judge Sofaer. No, sir. I think it is a completely naive----
    Chairman Specter. Mr. Klingler and Mr. Bellinger, I am 
going to ask you the same question. Any conceivable 
justification for that?
    Judge Sofaer. I think it is a completely naive view and a 
terrible thing to attribute to the Senate and the Congress. The 
notion that our Congress would support a law that would allow 
people to sue for killings in the United States but that would 
not include allowing them to sue for paying for those 
killings----
    Chairman Specter. Well, Judge Sofaer, aside----
    Judge Sofaer.--in Saudi Arabia----
    Chairman Specter. Aside from what the Congress would 
intend, what does the statute say? Is there any basis for 
taking the language of that statute and saying it does not 
apply when some acts are outside the United States?
    Judge Sofaer. Well, I think they were both wrong, the 
Second Circuit and the Solicitor General. I think the Supreme 
Court would have corrected them. And I applaud the fact that 
your bill would correct that by making it clear that if it 
happened, if the planning happened in Saudi Arabia, there would 
still be jurisdiction to deal with it in the United States.
    Chairman Specter. Mr. Klingler, any basis for that 
conclusion, aside from providing cover for asking the Supreme 
Court not to grant cert.?
    Mr. Klingler. I do not think it was a reasonable view in 
the context of this case. You could imagine certain 
circumstances where there are extremely indirect effects in the 
United States, where it may be relevant that the acts took 
place abroad and the harm was abroad. But that was not this 
case, and that was not the type of injury that your bill 
focuses on.
    Chairman Specter. What do you think, Mr. Bellinger?
    Mr. Bellinger. Well, I am afraid I am going to have to 
disagree with my distinguished colleagues. I think the Second 
Circuit did have a reasonable interpretation of the law here. 
It was, in fact, what others----
    Chairman Specter. I am not asking about the Second Circuit 
on asking that they be on the terrorist list. I am asking about 
the Solicitor General's conclusion that when acts occur outside 
the United States and have a direct impact, causality in the 
United States, if there is any basis for saying that that is 
not what the statute covers as an exception.
    Mr. Bellinger. Senator, I think the longstanding view of 
the U.S. Government--I know you would like to have witnesses 
from them and they will tell you--is that the tort exception 
was intended to be limited to torts inside the United States 
like traffic accidents and so forth. The concept of the Foreign 
Sovereign Immunities Act was to provide very limited 
jurisdiction against foreign sovereigns, just as we ourselves 
do not want to allow the United States to be opened to suits 
all around the United States.
    Chairman Specter. Any legislative history to support what 
you just said?
    Mr. Bellinger. I believe there is, Senator. I think that 
the suggestion was that the tort exception was intended really 
to cover traffic accidents and other minor torts by a foreign 
government that occur inside the United States. I agree that it 
is not crystal clear. That is why I say I think the Second 
Circuit's decision, which joined a number of other circuit 
courts, was a reasonable interpretation that the tort exception 
was limited to acts inside the United States.
    Judge Sofaer. But if I might intervene, Senator, the 
Solicitor General did not rest her position on that rationale. 
The Government disagreed with the Second Circuit that the tort 
provision was limited to minor torts, and they agreed with the 
plaintiffs that terrorist actions were included in the tort 
provision.
    So the issue is, where a terrorist action which is included 
in the tort provision occurs within the United States, can you 
rationally say that paying for that terrorist action in a 
separate tort in Saudi Arabia is something that Congress would 
not have intended to include? And I think you cannot.
    Chairman Specter. Well, Mr. Klingler, are you prepared to 
go as far as Judge Sofaer in criminalizing this conduct and 
using force against Federal Government nations?
    Mr. Klingler. I am not sure quite what the proposal on the 
table is, but I would certainly----
    Chairman Specter. Well, the proposal on the table is to go 
after those Saudi princes and bring them back for criminal 
prosecution.
    Mr. Klingler. As to the Saudi princes, the proceedings 
before the Supreme Court and the state of the litigation is a 
set of allegations at this point. So I do not think anything 
has been established by a court regarding what the nexus is, 
and I am not familiar with the factual record enough to have 
confidence that the allegations are true or false.
    Chairman Specter. Enough to support an investigation by the 
Department of Justice?
    Mr. Klingler. I do think, though----
    Chairman Specter. With a view to a criminal prosecution if 
those facts are found?
    Mr. Klingler. I do think that the powers that Judge Sofaer 
addressed are important and legitimate and largely encompassed 
today in statutes that do criminalize a range of terrorism-
related and support of terrorism measures. I also think that 
there is a range of use of force that both this administration 
and the prior administration have directed that are important 
and grounded in law.
    Chairman Specter. Mr. Bellinger, would you go along with 
any of Judge Sofaer's suggestions about criminalizing this 
conduct?
    Mr. Bellinger. Well, there are two questions. I think it is 
a good idea to have a broader reach of U.S. criminal laws. One 
of the things that we found after 9/11 when many of our critics 
said, ``Why don't you criminally prosecute these people who did 
these things instead of putting them in military commissions? 
'' was that our criminal laws had very limited reach and did 
not actually cover a lot of activities that occur solely 
outside the United States.
    And so, on the one hand, I agree wholeheartedly that we 
should expand the reach of our criminal laws to cover certain 
terrorist acts that occur wholly outside the United States. But 
that is a different question from the immunities of either the 
governments or of the officials, and so I would not necessarily 
suggest that we should strip senior officials in foreign 
governments of immunities. Those immunities protect the United 
States itself. It is a difficult two-edged sword with which I 
sympathize completely that we would like to hold senior 
officials accountable in foreign governments. But if we strip 
them of their immunities, then we will be risking stripping the 
immunities of our own senior officials, of our Secretary of 
Defense, of our Director of Central Intelligence. It would be 
very easy to accuse Leon Panetta or Bob Gates of directing an 
extrajudicial killing, and if we strip their immunities, I 
think that would be a dangerous thing for all of us.
    I agree that the force that the United States has been 
using is lawful around the world, but I would be worried about 
stripping the immunities of our officials to allow them to be 
sued in other countries.
    Chairman Specter. Well, you have made that clear. You would 
say there is an appropriate role for criminalization or use of 
force, but not something lesser like limiting immunity, which 
might boomerang.
    Mr. Bellinger. You have summarized my position very well. 
Thank you.
    Chairman Specter. Another comment, Judge Sofaer?
    Judge Sofaer. I just wanted to add, Senator, that this is 
not just about our criminalizing the conduct of foreign 
officials for sponsoring or paying for terrorist acts. The 
resolution of the Security Council, 1373--incidentally passed 
under Chapter 7, which relates to the use of force--calls on 
all states themselves to criminalize this conduct. So the Saudi 
Government has a duty under this resolution to criminalize the 
willful provision of funds, and also as subsection (d) says, to 
prohibit their nationals from engaging in the financial support 
of terrorist groups, directly or indirectly. The language is 
very comprehensive.
    So, you see, the system is there. The rules are there. And 
I would urge the Senate, Mr. Chairman, to take those 
international rules that are authoritative and make them a 
reality by putting them into U.S. law and reminding the world 
of their duties, duly adopted in the Security Council of the 
United Nations, to criminalize this conduct. That would be a 
step in the right direction to give us the justification, if 
they do not do it, for following up appropriately.
    Chairman Specter. Well, that would take a lot more far-
reaching action than this legislation urges.
    I want to come back for just a minute, before moving on to 
the next panel, to the issue which I had raised, and I have 
just sent for the article which I read in the Post this 
morning, and it touches on this issue directly and on many 
others. It is Stuart Taylor's commentary about judicial 
usurpation contrasted with judicial review. And he says that 
the Court would be wise to leave decision to the elected 
branches as opposed to giving their own views. And why does the 
Court get away with it? Because they stop short of infuriating 
the public.
    And I think, if the public understood what was happening 
with the Saudi princes and with the various charitable fronts, 
that the public would be infuriated. I think if the public 
understood what happened with the warrantless wiretapping 
contrasted with the statute, the Foreign Intelligence 
Surveillance Act, infuriated; that the Court declared 
unconstitutional the Americans With Disabilities Act or the law 
protecting women against violence, infuriated; or understood 
the campaign finance--they do understand a little of that. The 
polls are very strong there. Eighty-five percent of the public 
dislikes that.
    So the answer might be a lot simpler than legislation or 
Judge Sofaer's fancy international law postulates, but find a 
way to infuriate the public or let the public decide whether 
they are infuriated or not.
    Any ideas of how to do that besides taking at least a 
modest step of televising Supreme Court open arguments?
    Judge Sofaer. I try not to infuriate anyone, Senator.
    Chairman Specter. I should have taken your advice.
    Any comment, Mr. Klingler or Mr. Bellinger.
    Mr. Klingler. My only comment would go back to the prior 
discussion about the value or not of the executive branch 
expressing its views to the courts. I do not want to leave the 
impression that the fact that the Solicitor General filed a 
brief with the U.S. Supreme Court in the 9/11 case was 
improper. I do not think it was. The Court invited the views of 
the Solicitor General. That is a very traditional practice. It 
is a very valuable role that the Solicitor General's office 
serves in advising the Court. I think in general they have done 
an exceptionally good job of that. I think they did not do an 
exceptionally good job in this particular brief.
    I also think that the role of the executive branch in 
intervening in suits where there may be a foreign sovereign 
interest or a terrorism-related interest is also very valuable, 
that it can dissuade the Court from adopting erroneous views--
or at least present to the Court a set of executive branch 
issues and interests related to the potential effects on 
foreign affairs or the construction of the statutes before the 
Court. It can characterize the record, and the Department of 
Justice and the Department of State have often served 
incredibly valuable roles in buttressing our counterterrorism 
capabilities by intervening and filing briefs in just that 
fashion.
    Chairman Specter. Thank you very much, gentlemen. I 
appreciate your being here.
    Chairman Specter. We will turn now to panel two, so if our 
witnesses will step forward: Mr. Evan Kohlmann, Mr. Matthew 
Levitt--OK, so how many witnesses do we have? And Mr. Wolosky. 
Would you gentlemen stand, please, for the administration of 
the oath? Do you solemnly swear that the testimony you are 
about to give before this Committee will be the truth, the 
whole truth, and nothing but the truth, so help you God?
    Mr. Kohlmann. I do.
    Mr. Wolosky. I do.
    Chairman Specter. Thank you.
    Our first witness on this panel is Mr. Evan Kohlmann, 
terrorism consultant to NEFA Foundation, a nonprofit 
organization to help expose those who plan, fund, and execute 
terrorism, particularly Islamic militant organizations. The 
research has produced one of the world's largest and most 
extensive open-source databases of original documents, 
communiques, and multimedia information concerning terrorism. 
Mr. Kohlmann is a graduate of the Georgetown University Edmund 
Walsh School of Foreign Service and the University of 
Pennsylvania Law School. Thank you for joining us, Mr. 
Kohlmann, and the floor is yours.

   STATEMENT OF EVAN F. KOHLMANN, SENIOR PARTNER, FLASHPOINT 
    GLOBAL PARTNERS, NEW YORK, NEW YORK, AND INTERNATIONAL 
 TERRORISM CONSULTANT/SENIOR INVESTIGATOR, THE NEFA FOUNDATION

    Mr. Kohlmann. Thank you very much, Senator. Thank you to 
you and your staff for extending me the invitation to testify 
today.
    So far today we have talked about legal approaches with 
regards to foreign sovereign immunity, and I would like to 
address the factual side of this issue, particularly the role 
of state-sponsored or really state-directed Saudi Arabian 
charitable organizations in funding paramilitary and terrorist 
organizations. And I take your point that we need to get the 
public infuriated about this, and I think one of the ways to 
get the public infuriated about this is to present the facts to 
them.
    Last October, in the midst of a business trip to Bosnia, I 
passed the imposing King Fahd mosque in central Sarajevo. The 
mosque is, arguably, the major center of pro-Wahabi activism in 
the region, and it also serves as the headquarters for the 
official state-sponsored Saudi High Commission for Relief in 
Bosnia-Herzegovina. In fact, the impact of the Saudi High 
Commission can be felt within only steps of its front door.
    In October of 2009, when I was there, the items for sale at 
the vendor stall outside the mosque entrance included a crudely 
made DVD labeled on one side, ``Microsoft Flight Simulator: 
World Trade Center Edition,'' and on the other, emblazoned with 
images of Osama bin Laden and the World Trade Center, along 
with the title (in Bosnian), ``The Truth about September 11.'' 
This is right outside the front door of the Saudi High 
Commission.
    Indeed, though it was apparently established for 
humanitarian purposes, the Saudi High Commission and its staff 
in the Balkans have routinely engaged in behavior which goes 
far beyond any definition of religious missionary or relief 
work. This is particularly vexing because the Kingdom of Saudi 
Arabia has freely acknowledged that the Saudi High Commission 
is ``an arm of the Saudi Government.'' The evidence of Saudi 
High Commission complicity in providing financing, weapons, and 
other forms of logistical support to paramilitary and terrorist 
groups is quite literally overwhelming.
    An internal classified memorandum for the Muslim Army of 
Bosnia-Herzegovina Security Service in September 1994 
acknowledged that, ``What is interesting regarding the 
humanitarian organization, the Saudi High Commission, in Zenica 
is that they actually employ members of the El-Mujahideen Unit, 
the holy warriors, foreign fighters sent to Bosnia.
    The ARBiH report added that, ``the director of the High 
Saudi Commission has well-established cooperation with El-
Mujahidin units in Middle Bosnia.'' Upon arresting a Saudi High 
Commission staff member in January 1994 in connection with the 
brutal murder of a British aid worker, Asim Fazlic, the then-
chief of police in Zenica, commented, ``One of the strangest 
elements is that we still do not know the exact identity of 
[those] we hold in Zenica. They are very uncooperative and so 
far still insist, in spite of their car, their uniforms, and 
their weapons, that they are humanitarian aid workers.''
    The U.S. Department of Defense, the Pentagon, has concluded 
that ``The Saudi High Commission for Relief has provided 
financial support to former Arab mujahidin in Bosnia, the types 
of financial support included travel to Chechnya and to 
Afghanistan. At least one high-profile Saudi High Commission 
staff member in Bosnia-Herzegovina, an Algerian national by the 
name of Saber Lahmar, has been convicted in Bosnia-Herzegovina 
for the armed robbery of an American national for bombings 
there, was rearrested in October of 2001, and was sent to U.S. 
military custody in Guantanamo Bay, Cuba.
    Much as the Saudi High Commission was formed by the kingdom 
in order to organize NGO and humanitarian fundraising efforts 
for Bosnia, the Saudi royal family adopted a similar approach 
when confronted with the crisis in Kosovo in 1999. Under the 
chairmanship of Saudi Interior Minister Prince Naif bin 
Abdulaziz al-Saud, the kingdom formed the Saudi Joint Relief 
Committee for Kosovo and Chechnya.
    One of the first decisions by the Kingdom of Saudi Arabia 
that drew international scrutiny to the activities of the SJRC 
was the curious appointment of its initial director, Saudi 
national Wael Jalaidan. Jalaidan, also known as Abul-Hassan al-
Madani, was one of the first Arab mujahideen to join the anti-
Soviet jihad in Afghanistan during the 1980's. In an interview 
aired on the Al-Jazeerah satellite television network in June 
1999, bin Laden reminisced about the early days of the jihad in 
Afghanistan, recalling, ``We and the shaykh [Abdullah Azzam] 
were in one boat, as is known to you, together with our brother 
Wa'il Jalidan.''
    In the spring of 2000, U.S. officials sent a confidential 
memorandum to U.N. police forces in Southeastern Europe titled 
``Secret: U.S. office only Release to [the U.N. administration 
in Kosovo].'' According to that report, Wael Jalaidan is an 
associate of Osama Bin Laden and had directly assisted bin 
Laden ``moving money and men to and from the Balkans.'' As a 
result, on September 6, 2002, the U.S. and Saudi Governments 
announced an unprecedented joint action to freeze Jalaidan's 
assets and to specially designate him as a supporter of 
international terrorism. In other words, even the Saudi 
Government recognized that the director of their own state-
sponsored charity is an international terrorist.
    One of the biggest problems with this is that there are 
actual terrorists now, accused terrorists who are attempting to 
use the state sovereign immunity exception that appears to 
apply to Saudi High Commission and the SJRC in order to serve 
as a legal shelter for their own involvement in terrorist 
activities. One Algerian national in Guantanamo Bay told the 
U.S. military interrogators that ``the Saudi High Commission 
could not be bad because it was run by the Saudi Royal 
Family.''
    Even former staff members of quasi-private NGO's operating 
under the umbrella of the SJRC in Kosovo--such as the Al-
Haramain Islamic Foundation--have attempted to use the SJRC's 
official status with the Saudi Government to provide sovereign 
immunity.
    Guantanamo Bay detainee Yemeni national Jamal Mohammed 
Alawi Mar'i complained during a Pentagon ARB hearing, ``The Al 
Haramayn organization is a governmental agency. How [can] it 
[be] classified as nongovernmental and the person in charge is 
the Minister of the [Islamic Affairs]? ''
    Another Guantanamo detainee--an unnamed Jordanian who has 
lived in Pakistan since 1985--was also indignant when it came 
to charges that the Al-Haramain Foundation was involved in 
supporting terrorist activities: ``If you consider al-Haramayn 
as a terrorist organization you should talk to Saudi Arabia, 
because Saudi Arabia was the country that established al-
Haramayn. Its president is the royal prince there. Why don't 
you go over there and ask him? This is something you need to 
take up with Saudi Arabia.''
    These are the words of a Guantanamo Bay detainee, and these 
statements raise serious questions about the wisdom of allowing 
any form of sovereign legal immunity for employees or officials 
representing the Saudi High Commission, the Saudi Joint Relief 
Committee, or the various charitable organizations working 
under their diplomatic umbrella. This is especially the case 
when said class of employees and officials is known to include 
a variety of accused international terrorists, uncontested 
paramilitary combatants, Guantanamo Bay detainees, and, in the 
case of Wael Jalaidan, even a close friend of Osama bin Laden.
    Thank you very much, Senator.
    [The prepared statement of Mr. Kohlmann appears as a 
submission for the record.]
    Chairman Specter. Thank you, Mr. Kohlmann.
    We had planned to have Mr. Matthew Levitt present today. He 
is a senior fellow at the Washington Institute for Near East 
Policy, and he is testifying in New York. The trial started on 
Monday and had been expected to conclude so that he could have 
been here, but it has been carried over. But his full testimony 
will be made a part of the record.
    [The prepared statement of Mr. Levitt appears as a 
submission for the record.]
    Chairman Specter. We turn now to Mr. Lee Wolosky, partner 
in the law firm of Boies, Schiller & Flexner; had been director 
for transnational threats on the National Security Council 
staff during the administration of both President Clinton and 
President George W. Bush; served as co-director of the Council 
on Foreign Relations Task Force on Terrorism Financing; a 
bachelor and law degree from Harvard.
    Thank you for joining us, Mr. Wolosky, and we look forward 
to your testimony.

STATEMENT OF LEE S. WOLOSKY, PARTNER, BOIES, SCHILLER & FLEXNER 
                    LLP, NEW YORK, NEW YORK

    Mr. Wolosky. Mr. Chairman, thank you for inviting me to 
testify today before you and also for your leadership on an 
issue of significant importance to our country: deterring 
financial to international terrorist organizations. I have had 
the opportunity to consider these issues both as a National 
Security Council official and now as a lawyer in private 
practice.
    Along with the threat of governmental fines and sanctions, 
the prospect of substantial civil damages can deter deep-
pocketed corporations or individuals from doing business with 
terrorist organizations. In this way, civil litigation against 
financiers of terrorism can advance important public policy 
interests of the United States.
    As discussed by other panel members, S. 2930 expands 
exceptions available to private plaintiffs under the Foreign 
Sovereign Immunities Act. It also amends the Antiterrorism Act 
of 1991 by, among other things, expressly imposing liability on 
those who aid and abet acts of international terrorism and by 
making defendants in such suits subject to the personal 
jurisdiction of Federal district courts to the maximum extent 
permitted by the Constitution. In these ways, it expands the 
remedies available to victims of international terrorism 
seeking redress in U.S. courts.
    To illustrate why and how civil litigation can supplement 
the tools available to U.S. policymakers and governmental 
enforcement efforts in particular in deterring the financing of 
terrorism, I will focus my remarks, at the staff's request, on 
two cases concerning with which I have had personal 
responsibility as a lawyer in private practice. The first cases 
involved Arab Bank, PLC, and the second involves Chiquita 
Brands International.
    Arab Bank is a large, international financial institution 
based in Amman, Jordan. In 2004, six families of Americans 
injured or killed in Palestinian terrorist attacks in the 
territories filed a lawsuit against Arab Bank in Federal court 
in New York, where Arab Bank has offices, seeking $875 million 
in damages. The suit alleged that Arab Bank had served as 
paymaster for a dedicated program providing financial support 
originating from a Saudi Arabian entity called the Saudi 
Committee in Support of the Intifadeh Al Quds to the families 
of Palestinian suicide bombers and other terrorists who 
committed or attempted to commit terrorist acts that killed 
American citizens (and others). Other lawsuits making similar 
allegations followed.
    According to these lawsuits, the funds were disbursed to 
Arab Bank accounts opened in the name of beneficiaries and 
available at local Arab Bank branches in the Palestinian 
territories. Such payments are alleged to have served as 
incentives to would-be terrorists who could take comfort in 
knowing that their families would receive financial support if 
they attempted to commit a terrorist act. Beneficiary families 
are alleged to have received over $5,000 each.
    The ongoing civil litigation against Arab Bank supplements 
actions taken by U.S. regulatory and enforcement authorities. 
In 2005, Federal agencies levied a $24 million fine against 
Arab Bank. This amount pales in comparison to the $32 billion 
in assets that Arab Bank possessed at the time.
    The $24 million U.S. Government fine against Arab Bank has 
proven to be inadequate, in my judgment. Just this week, on 
Monday, a Federal judge sanctioned Arab Bank for refusing to 
turn over relevant bank records. Significantly, Arab Bank 
continues to do lucrative business in New York through 
correspondent banking relationships with major U.S. financial 
institutions, while refusing to provide compensation to those 
harmed by its conduct and while continuing to defy U.S. courts.
    A trial date in the civil cases against Arab Bank will 
likely be set for 2011. The bank faces the prospect of civil 
damages that could be a large multiple of the amount of U.S. 
Government fines levied against it to date.
    The Chiquita case provides another example of how civil 
litigation may complement U.S. Government enforcement actions. 
Chiquita has admitted to providing financial support to the 
United Self-Defense Forces of Colombia, the AUC, which the 
State Department designated a foreign terrorist organization in 
2001. It specifically admitted to making payments of $1.7 
million from 1997 to 2004. Chiquita has also admitted providing 
payments to the Revolutionary Armed Forces of Colombia, the 
FARC, which, like the AUC, is on the State Department's list of 
foreign terrorist organizations.
    In 2007, Chiquita pleaded guilty to engaging in 
transactions with a specially designated global terrorist and 
agreed to pay $25 million in fines to the U.S. Government. That 
year, Chiquita had annual revenues of $4.5 billion. Soon after 
the guilty plea, families of hundreds of Colombian and American 
victims killed by the AUC and the FARC filed lawsuits against 
Chiquita in U.S. courts. These suits demonstrate the deterrent 
role that civil litigation can play against the financing of 
terrorism: Chiquita faces potentially significant civil damages 
as a result of the civil litigation--far in excess of the $25 
million it agreed to pay as the result of U.S. Government 
enforcement actions.
    In sum, financial institutions, corporations, charitable 
organizations, and other large entities may continue to provide 
material support for terrorist organizations until it is 
financially unpalatable for them to do so. Although Government 
fines and sanctions are clearly an integral part of the effort 
to stem the flow of funds to terrorist groups, civil litigation 
can substantially enhance the financial consequences that such 
entities face. This proposed bill will make it easier for 
litigants to sue those who provide support to terrorists who 
kill or injure Americans. It will thereby help to deter future 
such conduct.
    Thank you very much.
    [The prepared statement of Mr. Wolosky appears as a 
submission for the record.]
    Chairman Specter. Thank you, Mr. Wolosky.
    You say the litigation against Chiquita was an effective 
deterrent. Why do you think that?
    Mr. Wolosky. Mr. Chairman, we do not yet know whether the 
litigation against Chiquita will prove to be an additional 
deterrent to the Government fines imposed against Chiquita 
for----
    Chairman Specter. Well, is Chiquita in a situation where 
they were likely to repeat that conduct?
    Mr. Wolosky. I do not believe so.
    Chairman Specter. Very different from al Qaeda rummaging 
out there, threatening to do more and doing more.
    Mr. Wolosky. I think that is a fair statement. Mr. 
Chairman, if I may, I think that the deterrent effects relates 
not only to specific conduct in specific countries around the 
world with respect to specific terrorists, but also to the 
system of internal controls that a corporation does or does not 
put in place.
    Chairman Specter. Mr. Kohlmann, you commented about a $24 
million fine, and you talk about other litigation pending 
against Arab Bank. How many fines or judgments have there been, 
to your knowledge, against terrorists linked with al Qaeda?
    Mr. Kohlmann. Excuse me, Senator. I think that was actually 
Mr. Wolosky who said that. Am I correct?
    Mr. Wolosky. Yes, I described the AB, both enforcement 
actions and the civil litigation against Arab Bank. Arab Bank 
is alleged to have provided support principally to Palestinian 
terrorist organizations, specifically Hamas.
    Chairman Specter. Well, how about as to al Qaeda? Any 
litigation, fines, or judgments as to al Qaeda?
    Mr. Wolosky. If you are asking with respect to the formal 
financial system, of which Arab Bank obviously is a part, al 
Qaeda presents a very different case. Unlike Palestinian groups 
which have raised money openly and notoriously in certain parts 
of the Muslim world, the financing for al Qaeda has been more 
indirect, and it frequently has not involved, or at least 
clearly involved, the flow of funds through the formal 
financial system in a way that funds would be clearly 
designated or earmarked for al Qaeda or, to draw a parallel to 
the Arab Bank case, to the beneficiaries, to family members of 
terrorist operatives.
    Chairman Specter. The 9/11 Commission Staff Monograph on 
Terrorist Financing found al Qaeda was funded to the tune of 
approximately $30 million per year by divisions of money from 
Islamic charities. What can be done to communicate that import 
with the imprimatur of the 9/11 Commission to the American 
public to understand what is happening? Mr. Kohlmann, any 
ideas?
    Mr. Kohlmann. Senator, I think one of the ways is showing 
what this money is actually paying for. At my company up in New 
York, we have been doing research recently about how the 
banking system continues to be used by al Qaeda to fund 
training camps, and, unfortunately, the evidence is out there. 
We have the actual bank accounts in Pakistan that are being 
used by al Qaeda and its allies to fund the training camps. And 
if you show people the bank account numbers and you show video 
of the training camps, where you have people literally shooting 
at targets marked ``USA,'' you have little kids under the age 
of 5 years old getting dressed up in uniforms and being made 
into warriors, that has a tremendous impact on people.
    I think the point is when it is dollars and cents----
    Chairman Specter. Can you tell me how it is having a 
tremendous impact on people?
    Mr. Kohlmann. Well, if you can actually see the images of 
the people getting trained----
    Chairman Specter. Who can see the images?
    Mr. Kohlmann. Well, the evidence is out there, 
unfortunately. I just do not think that----
    Chairman Specter. Out there, but has it been displayed by 
the news media, which is the way people get information?
    Mr. Kohlmann. That is one way, Senator, but I think that 
the State Department and other branches of the U.S. Government 
also have a role here in terms of making sure that this 
information is not only available to the news media but it is 
directly available to the public. Unfortunately, this is not 
secret evidence.
    Chairman Specter. Well, directly available does not mean 
they get it.
    Mr. Kohlmann. No. But I think if you can present it to 
their--a lot of people do not believe this because they cannot 
see it, and a lot of this evidence that is out there is 
actually open-source information. It is not secret. It is not 
classified. There is no reason why the U.S. Government should 
not be putting money and effort into broadcasting those kind of 
facts to the public.
    I think ultimately if you are talking about bank account 
numbers alone, you are not going to get a lot of excitement 
from the U.S. public. You are not going to get a great degree 
of understanding. If you show people what this money is paying 
for, the murder of innocent people, training little kids to 
fight in combat, then all of a sudden I think it becomes much 
more clear, No. 1, why it is so important to crack down on 
charities or other institutions that misuse humanitarian 
fundraising.
    Chairman Specter. Let me move to some other factual 
findings here. The Saudi High Commission, according to U.S. 
Government sources, was involved in financing al Qaeda members 
to attack the U.S. embassies in Bosnia in 1997. To what extent 
was that publicized?
    Mr. Kohlmann. As far as I know, Senator, it has not been 
publicized at all, nor has the fact that the SJRC was raided in 
1999 and 2000 for its role in attempting to assassinate--or the 
role of its staff attempting to assassinate Western diplomats.
    Chairman Specter. Well, you took my question and added 
another illustration. Has that been publicized?
    Mr. Kohlmann. To my knowledge, Senator, it has not been 
publicized--not well publicized, certainly. It is available if 
you know where to look, but, you know, that would take some 
digging.
    Chairman Specter. It is available if you know where to go 
to look. People do not go to look.
    Mr. Kohlmann. I agree, Senator.
    Chairman Specter. Unless it is spoon-fed on MSNBC.
    Mr. Kohlmann. I agree, Senator. That is one of the issues 
and that is one of the reasons why I think the U.S. Government 
in its own interests should be out there publicizing this 
information. If we simply say that an organization is a 
terrorist group or if we simply say it is a front for 
terrorism, that is not the same thing as saying this group 
provided the money and means for individuals to attempt to blow 
up the U.S. embassy in Sarajevo.
    Chairman Specter. OK. Let me move to another factual matter 
which is of concern. Wiretap summaries obtained from the 
International Criminal Tribunal for Former Yugoslavia revealed 
that members of al Qaeda mujahideen in Bosnia were directed to 
pick up funds for the Saudi High Commission. A UN-sponsored 
resolution further determined that the Saudi High Commission 
transferred in excess of $120 million to the Third World Relief 
Agency between 1992 and 1995.
    Any publicity on that, Mr. Wolosky, that you know about?
    Mr. Wolosky. Not that I am aware of, Mr. Chairman. I would 
point out that the sort of framework of financing that you have 
described and that Mr. Kohlmann has described with respect to 
so-called Saudi charities is one that has been employed in many 
parts of the world to provide support to Islamic extremist 
movements. And, in fact, as I described in my testimony, there 
was and may still be a similar Saudi entity that provided 
support to Palestinian terrorist organizations such as Hamas. 
In that case, unlike perhaps in some of these other cases, they 
used a bank that happened to have had offices in New York City 
and was, therefore, subject to the personal jurisdiction of 
Federal courts by civil litigants who chose to sue it in New 
York.
    One of the points that I would make about the proposed 
legislation is that it expands personal jurisdiction over 
individuals or organizations that are accused of financing 
terrorism to the maximum extent allowed by the Due Process 
Clause. So in that respect, it is doing a great service to the 
victims who in the future may not be so lucky as to find an 
entity doing business in New York.
    Chairman Specter. What publicity has been given, to your 
knowledge, to the International Islamic Relief Organization 
which has financed terrorist activities?
    Mr. Wolosky. In a narrow circle of people who follow these 
things closely, which includes me and Evan and a few others, a 
fair degree. But to your point, in the broader American public, 
not enough.
    Chairman Specter. So Evan and I are pretty much convinced.
    Mr. Wolosky. Yes. It is the rest of us that we need to----
    Chairman Specter. What is that?
    Mr. Wolosky. To your point, it is the rest of the country 
that needs to get educated.
    Chairman Specter. Well, that is a big part of the jobs that 
all of us have, and I think if the public was aware of what is 
going on, that would pass the infuriating test which I referred 
to earlier, adopting Stuart Taylor's approach to getting 
something done, getting judicial restraint, permit a case like 
this to go forward, and at least be heard extensively in a 
courtroom.
    Anything either of you gentlemen would like to add at this 
point?
    [No response.]
    Chairman Specter. Thank you very much. That concludes the 
hearing.
    Mr. Kohlmann. Thank you, Senator.
    Mr. Wolosky. Thank you.
    [Whereupon, at 11:31 a.m., the Subcommittee was adjourned.]
    [Submissions for the record follow.]
    
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