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

[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
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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

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Serial No. J-111-100

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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
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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

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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

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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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