[House Hearing, 113 Congress]
[From the U.S. Government Publishing Office]
THREATS TO ISRAEL: TERRORIST FUNDING AND TRADE BOYCOTTS
SUBCOMMITTEE ON TERRORISM, NONPROLIFERATION, AND TRADE
COMMITTEE ON FOREIGN AFFAIRS
HOUSE OF REPRESENTATIVES
ONE HUNDRED THIRTEENTH CONGRESS
MARCH 5, 2014
Serial No. 113-128
Printed for the use of the Committee on Foreign Affairs
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COMMITTEE ON FOREIGN AFFAIRS
EDWARD R. ROYCE, California, Chairman
CHRISTOPHER H. SMITH, New Jersey ELIOT L. ENGEL, New York
ILEANA ROS-LEHTINEN, Florida ENI F.H. FALEOMAVAEGA, American
DANA ROHRABACHER, California Samoa
STEVE CHABOT, Ohio BRAD SHERMAN, California
JOE WILSON, South Carolina GREGORY W. MEEKS, New York
MICHAEL T. McCAUL, Texas ALBIO SIRES, New Jersey
TED POE, Texas GERALD E. CONNOLLY, Virginia
MATT SALMON, Arizona THEODORE E. DEUTCH, Florida
TOM MARINO, Pennsylvania BRIAN HIGGINS, New York
JEFF DUNCAN, South Carolina KAREN BASS, California
ADAM KINZINGER, Illinois WILLIAM KEATING, Massachusetts
MO BROOKS, Alabama DAVID CICILLINE, Rhode Island
TOM COTTON, Arkansas ALAN GRAYSON, Florida
PAUL COOK, California JUAN VARGAS, California
GEORGE HOLDING, North Carolina BRADLEY S. SCHNEIDER, Illinois
RANDY K. WEBER SR., Texas JOSEPH P. KENNEDY III,
SCOTT PERRY, Pennsylvania Massachusetts
STEVE STOCKMAN, Texas AMI BERA, California
RON DeSANTIS, Florida ALAN S. LOWENTHAL, California
TREY RADEL, Florida--resigned 1/27/ GRACE MENG, New York
14 deg. LOIS FRANKEL, Florida
DOUG COLLINS, Georgia TULSI GABBARD, Hawaii
MARK MEADOWS, North Carolina JOAQUIN CASTRO, Texas
TED S. YOHO, Florida
LUKE MESSER, Indiana
Amy Porter, Chief of Staff Thomas Sheehy, Staff Director
Jason Steinbaum, Democratic Staff Director
Subcommittee on Terrorism, Nonproliferation, and Trade
TED POE, Texas, Chairman
JOE WILSON, South Carolina BRAD SHERMAN, California
ADAM KINZINGER, Illinois ALAN S. LOWENTHAL, California
MO BROOKS, Alabama JOAQUIN CASTRO, Texas
TOM COTTON, Arkansas JUAN VARGAS, California
PAUL COOK, California BRADLEY S. SCHNEIDER, Illinois
SCOTT PERRY, Pennsylvania JOSEPH P. KENNEDY III,
TED S. YOHO, Florida Massachusetts
C O N T E N T S
Mr. Edwin Black, author.......................................... 7
David Pollock, Ph.D., Kaufman fellow, The Washington Institute
for Near East Policy........................................... 39
Mr. Steven Perles, founder and senior partner, Perles Law Firm,
LETTERS, STATEMENTS, ETC., SUBMITTED FOR THE HEARING
Mr. Edwin Black: Prepared statement.............................. 9
David Pollock, Ph.D.: Prepared statement......................... 41
Mr. Steven Perles: Prepared statement............................ 48
Hearing notice................................................... 82
Hearing minutes.................................................. 83
THREATS TO ISRAEL: TERRORIST FUNDING AND TRADE BOYCOTTS
WEDNESDAY, MARCH 5, 2014
House of Representatives,
Subcommittee on Terrorism, Nonproliferation, and Trade,
Committee on Foreign Affairs,
The committee met, pursuant to notice, at 10 o'clock a.m.,
in room 2172 Rayburn House Office Building, Hon. Ted Poe
(chairman of the subcommittee) presiding.
Mr. Poe. This subcommittee will come to order. Without
objection, all members will have 5 days to submit statements,
questions, extraneous materials for the record subject to the
length limitation in the rules.
Israel is our great friend and ally. For over 50 years, the
United States and Israeli leaders have been close friends. Our
common values of democracy and liberty unite us, among other
This administration sometimes forgets this. Be it the
Iranian nuclear program or pressuring Israel over peace talks
with the Palestinians, our recent policies have damaged our
I was in Israel not too long ago when I met with Prime
Minister Netanyahu when Secretary Kerry came down with the
deal, the bad deal, as Prime Minister Netanyahu referred to. We
let Iran walk all over us. At the end of the day, we weakened
sanctions in exchange for allowing Iran to continue to develop
In my opinion, the United States gave away the farm and the
mineral rights in this bad deal. The threats against our good
friend Israel are growing. The point of this hearing is to
examine three issues.
First, the issue of European countries boycotting Israeli
businesses that are in the settlement areas. Make no mistake,
this is a political move, not an economic move.
Some European countries don't like Israeli settlements so
they are trying to shut them down by not buying any goods from
Israel. European Union is Israel's number-one trading partner
to the tune of about a third in total trade.
If EU countries turn the heat on boycotts it could have
dire consequences for the Israeli economy. In January, a $200-
billion Dutch pension firm divested from five top Israeli
In January, Germany announced that it would not renew
research grants to Israeli companies that do business over the
I fear this is an intentional move to pressure the Israelis
to give ground, literally give ground, in peace talks with the
Palestinians. But boycotting goods is the wrong way to get
peace. All issues, including the settlement issue, need to be
solved at the negotiating table with the Palestinians.
These boycotts will only strengthen the Palestinian hand
and make them less likely to agree to peace. The peace talks,
in my opinion, are useless unless the Palestinians agree at the
outset and say publicly and believe it that Israel has a right
to exist as a nation.
The second issue on this hearing is the Palestinian
Authority giving bags of money to convicted terrorists in
Israeli prisons. Right now, there are over 4,500 Palestinian
prisoners in Israeli jails, most of them serving time for
Many of these terrorists receive a salary directly from the
Palestinian Authority. Monthly salaries range from $500 to
$3,500. The more serious the crime, the more dead Israelis or
Americans, the more money the Palestinians in jail receive.
In Palestine, being a terrorist is one of the best paying
jobs. According to some estimates, the Palestinian Authority
spends $4 million to $7 million per month on this program,
which is about 6 percent of the budget.
One terrorist, Husni Najjar, explained to Israeli police
after his capture that he planned a terror attack in order to
be captured so he could receive money from the Palestinian
Authority. Now, isn't that lucky?
Here is the real problem. The United States gave $440
million in Fiscal Year 2013 to the Palestinian Authority. We
all know that money is fungible. The more money we give to help
them with these ``job'' programs, the more money the
Palestinian Authority has to pay terrorists.
U.S. taxpayer money should not be paying and rewarding
Palestinian terrorists for doing harm and killing Israelis and
Americans. I am also, finally, concerned about the lack of
justice for American victims in terrorist attacks that occur in
At least 54 Americans have been killed by Palestinian
terror attacks since 1993. Another 83 have been seriously
wounded. Some perpetrators of these attacks have never been
brought to justice. Some have served limited sentences and then
they were released.
The FBI could be doing more to track down these killers and
bring them to the United States to stand trial. I think the
United States Government owes that to the victims of these
Victims of these attacks are also seeking justice through
the U.S. courts. The defendants are the Palestinian Authority
and numerous foreign banks who are accused of funneling money
to Palestinian terrorists.
In one case, which we will hear more about today, a
Jordanian bank is accused of laundering $90 million to Hamas
through over 200,000 separate transactions. That is a lot of
money and it buys a lot of terror.
I look forward to hearing from our witnesses and what they
have to say today. I now move to our ranking member, Mr.
Sherman, from California for his remarks.
Mr. Sherman. First, as to the Iranian deal, it is, clearly,
But we should remember that from 1998 until 2010 three
administrations failed to enforce the sanctions laws we did
pass and, more importantly, used all their power to go over a
decade without us passing any additional significant sanctions.
When we woke up in October of last year, we were in an
incredibly weak bargaining position, strengthened only a bit by
the sanctions adopted in 2010.
So it is hard to say that the deal reached in Geneva is the
problem. The problem is that for over a decade we did nothing
and it is hard to win a football game--you can yell at the
coach as to what play he calls in the fourth quarter. If you
don't put a team on the field the first three quarters, you are
not going to find a great play for the fourth quarter.
Now, as to these hearings, the effort to boycott and
delegitimize Israel is anti-Semitism, plain and simple. When
the world's only Jewish state is held to standards no other
state is held to and then is subjected to punishments no other
state is subjected to, the motivation becomes clear.
If the worst human rights abuse in the world is building an
apartment building in the wrong place, so any mistake--
decisions made by my own city council may fit into that
category--we in this room have heard such incredible human
rights abuses that those who think that the only nation worthy
of sanctions is one that builds apartment buildings in the
wrong place is very--it is anti-Semitism, plain and simple.
In addition, there are those who focus on a particular
instance and say that a particular Israeli sergeant shouldn't
have fired his gun but should have waited longer for the
potentially hostile person to approach even closer, even while
Well, none of us are in that position. Who knows how much
we would risk our lives in order to determine whether the
person approaching and ignoring our demands to stop was a
civilian or a terrorist.
But the fault of any incident and hundreds like that take
place every year is not the sergeant who does or does not risk
his life to this or that degree.
The fault are those politicians who seek unreasonable aims
through violent means. War is not the fault of those who fight
it. It is the fault of those who wage it.
As to the particular efforts by some to halt economic
activity on the West Bank by boycotting products grown or made
there, this is more than absurd.
You are going to strangle companies that provide jobs to
Palestinians, then put on films about how the Palestinians
don't have jobs and then demand that the U.S. taxpayer give a
lot of money to the PA authority so they can employ people
without jobs and then, as the chairman points out, have the PA
authority give that money to terrorists.
I think the term is chutzpah. It is simply absurd for those
who claim to be concerned about the Palestinians to oppose
investment that creates Palestinian jobs and the only bad thing
about the location of SodaStream is that they are not located
in my district, the only place I would rather see jobs or one
of the places I would rather see jobs than anywhere in the
Finally, as to aid to terrorists, our efforts should begin
at home. There are those who provided--U.S. citizens who are
part of the flotilla that provided aid to Hamas, those folks
were violating U.S. terrorist law.
We did nothing. Then there is Viva Palestina, which is on
tape--we will show you the YouTube--giving assets to Hamas and
soliciting tax deductible contributions from American
Finally, after considerable prodding, the IRS has begun the
effort and it is not yet effective to make sure that a
particular organization doesn't advertise that you give money
to them and they will funnel the money to Viva Palestina which
will fund the money to Hamas and give you a tax deduction for
We have got to stop terrorist financing. It starts here. I
Mr. Poe. I thank the ranking member for his wise comments.
The Chair will recognize other members who want to be heard
for 1 minute. The Chair recognizes the other gentleman from
California, Mr. Rohrabacher, for 1 minute.
Mr. Rohrabacher. Thank you very much, Mr. Chairman.
I recently--well, it was recently I've been in Israel, it
seems to be someplace that all Members of Congress have to go
and I did speak to both sides.
I spoke to people in the Palestinian Authority as well as
the Israeli Government and I have come to the conclusion that
there is only one thing holding up peace right now--a peace
agreement between Israel and the Palestinian people--and that
is that the Palestinian people will not forcefully and
forthrightly announce that they do not have a right to return
to the pre-1967 borders of Israel.
And, of course, Israel won't agree to that because we are
talking about millions of people's right to inundate that
country, which would mean that country wouldn't exist anymore
as the country that it is.
And just like we, for example, couldn't sign a treaty with
Mexico saying that anybody who can trace their family roots
back to the Southwest has a right to emigrate into the United
States and then we would have 50 million to 75 million new
American citizens, all of whom are Mexican.
Now, I would hope that with all the other issues that we
are talking about that we put that in perspective. I think the
other issues, the settlements, all these other things are
But until the Palestinians step forward and make that
agreement, Israel will exist. It will exist and we don't have a
right to inundate it with millions of other people, there won't
be peace and there won't be agreements, and I would certainly
like the opinion of our panelists today as to whether or not my
perception of the real stumbling block is really what it is all
So thank you very much, Mr. Chairman, for holding the
hearing so that we can enlighten ourselves and get some good
information to see maybe we can bring peace if we understand
exactly what the problem is. Thank you.
Mr. Poe. I thank the gentleman.
The Chair will also recognize another member from
California, Mr. Vargas.
Mr. Vargas. Thank you very much, your Honor. I appreciate
it, and I thank you very much again, Mr. Sherman, for bringing
this issue forward so we can discuss it today.
I would associate myself with the comments that you made as
well as our ranking member and I would say this, that Israel is
our closest and faithful ally and we should act accordingly.
One of the things that is disturbing is to see some of
these European nations acting, as I would say the same as the
ranking member, in a very anti-Semitic way. You see all the
human rights abuses around the world and it is interesting, you
only pick on Israel.
Interestingly too I was in Israel recently and virtually
every Israeli that you talk to wants peace and in fact some of
the things that the government has been willing to do--release
murderers and terrorists--just to talk--just to talk about
peace, trying to get to a settlement.
And you go to the Palestinian areas as we did and they only
speak hate and how much they hate the Jews and how much they,
you know, blame everybody else except for themselves for the
situation they are in.
So, again, I thank you very much for bringing this forward
and I hope that we can act as a faithful ally as Israel has to
us in a very difficult part of the world.
Thank you, Mr. Chair.
Mr. Poe. I thank the gentleman.
The Chair will now recognize the gentleman from
Pennsylvania, Mr. Perry.
Mr. Perry. Thank you, Mr. Chairman.
It is an important hearing. You know, we tend to think of
the fight against terrorism as a burden that falls mainly on
the shoulders of government or military, diplomatic, homeland
security and law enforcement agencies.
Yet, there is one area where private citizens can play a
leading role and that is in stopping the flow of funds to
Beginning in the 1990s, Western countries and especially
the United States passed laws making it possible for victims of
terror to sue the regimes that sponsor terror, banks that
transfer funds to terror groups, front organizations that
pretend to serve charitable causes, and even the terrorists
It is with this in mind that I would like to show some
appreciation for the work of the Perles Law Firm and also the
Israel Law Center who work together with Western intelligence
agencies and volunteer lawyers around the world to file legal
actions on behalf of the victims of terror.
With that, I really look forward to your testimony here
today. Thank you, Mr. Chairman. I yield back.
Mr. Poe. The Chair will recognize the gentleman from
Massachusetts, Mr. Kennedy, for 1 minute.
Mr. Kennedy. Thank you, Mr. Chairman.
I want to thank the ranking member as well for calling this
important hearing and the witnesses today for making themselves
I very much look forward to your testimony and what you
could do to educate this subcommittee on the threats that an
extremely important friend and ally to the United States and
the state of Israel is facing.
And not just Israel but, really, the--from my vantage
point, as a pillar of democracy and stability in the Middle
East what their reach of those that wish to do those forces of
democracy and stability harm.
I, along with Mr. Vargas, had a chance to visit Israel a
couple of months ago and I was just recently in Asia with Mr.
Sherman as well, as we explored some of the threats and the
complexities confronting some of these forces literally around
And so I want to thank the chairman for calling this
hearing and look forward to your testimony today.
Mr. Poe. I thank the gentleman.
The Chair will now recognize Mr. Lowenthal, also from
California, for 1 minute.
Mr. Lowenthal. Thank you, Mr. Chair and Ranking Member
Sherman. I want to thank you for putting this hearing together
in order for our committee to examine some of the strategic
issues of interest to the United States and to the U.S.-Israel
partnership and Israel's relation with the European Union and
some of the critical issues around that.
I just want to say, while I proudly consider myself pro-
Israel, which I am, and certainly anti-terrorist and I am very
glad for this hearing, I also believe as we listen and we
understand that we take an unbiased and objective point of view
that if we are ever going to have peace between the Israelis
and the Palestinians that we also hear and try to understand as
much as possible the Palestinian point of view.
We may not always agree with it but we have to hear it and
understand it and I think that is very important as we move
forward. Thank you.
Mr. Poe. I thank the gentleman.
Without objection, all of the witnesses' prepared
statements will be made a part of the record. I ask that after
I introduce each witness that they keep their presentation to
no more than 5 minutes and I will introduce each witness now
and then give them time for their statements.
Mr. Edwin Black is an award-winning New York Times best-
selling author with more than 1 million copies in print. His
work focuses on genocide and hate, corporate criminality,
corruption and historical investigation.
Mr. Black has been interviewed on hundreds of network
broadcasts from the ``Today Show,'' CNN and NBC as well as
leading networks in Europe and in Latin America.
Dr. David Pollock is the Kaufman fellow at the Washington
Institute where he focuses on the political dynamics of the
He previously served as senior advisor for the Broader
Middle East at the State Department and in several other
advisory positions there, including 4 years as regional expert
on the Secretary of State's policy planning staff.
Previously, he was also chief of Near East, South Asia,
Africa Research at the U.S. Information Agency.
Mr. Steven Perles is the senior attorney and founder of the
Perles Law Firm. He has litigated matters before the Supreme
Court, courts of appeal, and district courts throughout the
His litigation practice's focus is primarily on cases
involving the immunity of foreign sovereigns and has included
several groundbreaking cases against foreign states for their
complicity in acts of international terrorism.
Notable recent decisions include a successful turnover
action against a $1.9 billion Iranian Central Bank funds in
which money had been laundered into the United States.
I thank all three of you for being here. We will start with
STATEMENT OF MR. EDWIN BLACK, AUTHOR
Mr. Black. I thank this committee for inviting me. I am
Edwin Black and before I testify before any Parliament I always
say I come not as a Republican or a Democrat, a conservative or
a liberal. I am here for my information.
I did hear the remarks of Chairman Poe and Member Sherman
and I found them to be factually accurate and historically
So I am here to talk about the Palestinian terrorists'
salaries, which I broke in my book on November 1st of last year
in canon. My book is ``Financing the Flames'' and it is an
inescapable reality that American taxpayers are directly
funding individual named terrorists for individual named
terrorist acts, just as Chairman Poe said. Here is how it
An individual in the Palestinian Authority can go from
being a nobody to a somebody, from rags to riches, just by
committing an act of terrorism, perhaps blowing up a bus or
invading a home and slicing the throats of children.
At that point, he will go on an immediate official
Palestinian Authority salary. The more people you kill, the
higher is your salary. It can range, as you said, from a few
hundred dollars a month for maybe a 5-year sentence and it
actually can go up to $10,000 a month for a 25-year sentence.
The actual law itself which governs this is published in my
book on Page 184 and this is the actual law and you can see the
sliding scale. This money also includes a rank in the
government. You become a manager, a director, a supervisor.
You can even become an Assistant Deputy Minister and so you
have a civil rank as well. This money constitutes about $5
million to $7 million a month of PA resources.
It is prioritized, which means if they only have a million
bucks in the bank and there is no food or they are lacking
medicines and they need to pay these salaries, they pay the
The money goes directly to the prisoner by means of a POA--
that is a power of attorney--and he can then turn it over to
his girlfriend, to his mother, to his family, to his soccer
club, to al Fatah, whatever it is. It does amount to
approximately 6 percent of the PA budget.
If there is any lack of alacrity in prioritizing these
funds, there is an NGO called the Prisoners Club that makes
public agitation to make sure that these moneys are paid. If
you add in the additional emoluments--wedding benefits,
scholarships, soccer teams, special celebrations--it comes to
16 percent of the Palestinian Authority budget.
All of this money comes from donor countries such as the
United States, and in the United States it is strictly against
the law. The individual that Chairman Poe identified, Husni
Najjar, who deliberately committed--initiated a terrorist plot
was seeking money for wedding expenses.
So while Americans are choosing between food and fuel,
Palestinians have an understanding that there is a bottomless
pit of salaries for terrorists.
Now, there is never going to be peace in the Middle East
between the parties because the chief export is confrontation,
terrorism. This is a--this is a business. It is kind of like
asking the Saudis to stop drilling for oil. This is what they
And the idea that this is not known is incorrect. It is
true that I broke this in my book here but everybody in this
room knows about this. Everybody in the Palestinian Authority
knows about this. The entire Western media knows about this.
The State Department has always known about this. The
Foreign Office, the foreign ministries overseas have always
known about this. The only one who has not been informed about
this are the members in this institution and the constituents
who vote the money.
Now, I have only got 6 seconds left so I won't go on. But
if you also wish to ask me any questions about this, the
international law, SodaStream or any of the--or who is
financing among our taxpayers BDS, I will be happy to answer
those questions too.
And thank you very much for having me.
[The prepared statement of Mr. Black follows:]
Mr. Poe. Thank you, Mr. Black. You got a lot in in 5
STATEMENT OF DAVID POLLOCK, PH.D., KAUFMAN FELLOW, THE
WASHINGTON INSTITUTE FOR NEAR EAST POLICY
Mr. Pollock. Thank you very much, Mr. Chairman, honorable
members, for inviting me to testify to you today. It is an
honor for me to be here and I think important to discuss the
timely and important topic of European attempts to boycott
Prime Minister Netanyahu spoke just yesterday at AIPAC at
length about the BDS movement and I would like to begin with
some facts and figures.
The boycott threat against Israel right now is much more
potential than real. Israel's economy continues to thrive,
estimated to be growing in the range of 3 percent annually, in
large part because of its continuing ability to export and to
attract foreign investment.
This includes trade and investment to and from the European
Union, which remains Israel's single largest trading partner,
with the U.S. close behind.
Just to put this Israeli economy in global and U.S.
perspective, it is worth noting that despite its relatively
small size the health of Israel's economy is also in our own
The high-tech partnerships between Israel and the United
States are well known. But it may surprise you to hear that
over the last decade Israel has been a larger market for U.S.
exports than oil-rich Saudi Arabia.
Or that at times during this past decade Israel was one of
the top 20 foreign direct investors in the American economy or
that Israeli companies, products and licensed technologies are
directly responsible for tens of thousands of decent jobs for
American workers right here at home.
As for current European policies, it is important to note
that no European government supports any type of boycott
against Israel today. When it comes to Israeli settlements or
economic or other institutions beyond Israel's 1967 de facto
borders, however, official European practice diverges.
For example, the Horizon 2020 agreement between the EU and
Israel signed late last year predicates that the EU will not
fund research or related activities in Israeli settlements, and
at the level of EU governments the EU has advised its members
that they may require, and several of the major European
countries do require, special labels for Israeli products
manufactured in the settlements across the 1967 de facto
At the level of the private sector or quasi government
economic entities, some European institutions have announced
divestment or selective boycotts of Israel and some of those
were mentioned by some of you in your remarks just a few
But on closer examination, most of these moves turn out to
be either restatements of previous positions or very minor in
economic impact. Moreover, these steps have been offset by
other more positive new decisions by European governments and
by European companies.
A few weeks ago, I had the privilege of testifying about
this issue in Europe to the Senate Foreign Relations and
National Defense Committee of the French Parliament and I would
like very briefly to mention a few points that came up in that
First of all, I noted that the Palestinian President
himself, Mahmoud Abbas, when asked recently about boycotts
against Israel, said publicly in Arabic that the PA opposes
boycotts against Israel.
Unfortunately, however, as is the case with many issues,
other official Palestinian spokesmen have refuted that very
statement. For example, Hanan Ashrawi, recently in an op-ed in
an Israeli newspaper, wrote that boycotts against Israel are,
as she put it, ``the Palestinian nonviolent resistance.''
But when I told the French Senate that President Abbas of
Palestine opposes boycotts against Israel and I asked him why
then do you in Europe in some cases support boycotts against
Israel, they had no good answer.
I believe that this is the kind of approach that the United
States can also take, raising this issue very publicly as you
are doing today, considering whether there might be legislative
or other legal remedies against boycotts against Israel, as we
do, for example, in refusing to allow American companies to
enforce the Arab boycott against Israel. These are measures
that could very well we considered and that could nip this
problem in the bud.
Thank you again for the opportunity to address you and I
look forward to your questions and discussion.
[The prepared statement of Mr. Pollock follows:]
Mr. Poe. Thank you, Dr. Pollock.
STATEMENT OF MR. STEVEN PERLES, FOUNDER AND SENIOR PARTNER,
PERLES LAW FIRM, P.C.
Mr. Perles. Thank you, Mr. Chairman, Mr. Sherman. You know,
before I begin my comments this morning, I will say that I do
think senior members of the Bar have an obligation to help
launch the careers of younger generation of lawyers.
It is why I teach, and in that spirit I would like to
introduce Ms. Kristin Stitchers to the committee. Ms. Stitchers
is my clerk and she is a law student at the George Mason
University in northern Virginia. Thank you.
We have been studying the material support of terrorist
attacks around the globe, particularly Palestinian terrorist
attacks that result in the death or personal injury of United
States nationals since 1995.
And I would break that material support into two tiers
because it has been our observation over the last almost 20
years that there really are two tiers of Palestinian
At the--you have an upper level, terrorists like Hassan
Salameh whose activities killed Matthew Eisenfeld and Sara
Duker. Matthew was from Connecticut. Sara was from New Jersey.
Now, Hassan Salameh was recruited by Iran in Gaza. He was
smuggled through Egypt into the Sudan, flown on an Iranian
military aircraft to Iran. He was trained in Iran and then he
was returned through the Sudan and Egypt back into Gaza.
One of the more perplexing things about that attack is when
we looked at the forensics of the bomb, the energetic was a
plastic explosive that had been made in the United States for
which there is only one customer and that is the United States
Department of Defense.
And, candidly, I could not figure out how a plastic
explosive made for the Defense Department wound up in a Hamas
terrorist's gym bag.
As it turned out, Hassan Salameh was trained--and we
learned a great deal about his training curriculum in Iran--he
was trained by the Iranians not only to recruit suicide bombers
but to recruit suicide land mine defusers and he was taught how
to defuse U.S.-manufactured land mines.
In fact, we determined that the land mine--that what had
happened was when Hassan Salameh was coming back through Egypt
he recruited suicide land mine defusers, went into mine fields
that the Egyptian Government had set up under the provisions of
the Camp David Peace Accords--and, of course, mine fields are
not guarded, they are simply posted--and they went in until
they were able to salvage an American-made mine that was
designed to destroy a Soviet T-54 tank, and I believe Hassan--I
believe that energetic killed two U.S. nationals and 25 or 27
Israelis inside a bus.
The terrorist, and that is the suicide bomber, essentially
was vaporized by the energetic inside of the bus. The lower-
level terrorists are people like the suicide bomber on the bus.
Those are the kinds of people that are getting martyr support.
Now, we have what I consider to be probably the most
important case in the country right now on martyr payments and
that is what is referred to as Litle versus the Arab Bank or
the Arab Bank series of cases.
Abigail Litle was the daughter of a professional
administrator in the Baptist Church. He was posted in Haifa. He
took his daughter--he took his family with him to Israel. She
did what all 13-, 14-year-old girls do.
She made friends with all the 13-, 14-year-old girls in her
neighborhood. They all got on a bus together one morning to go
to school. They all died together on that bus. That terrorist
receives martyr payments that were--and this currency is not
This currency is Saudi, and it was funneled through the
Arab Bank's branch in Brooklyn, New York, which is why we
brought the action in New York. The Eisenfeld and Duker action
was brought under the Foreign Sovereign Immunities Act against
That was successfully prosecuted. This action was brought
under the Anti-Terror Act because the Arab Bank of Jordan is a
private actor. The remedy against private actors is under the
ATA rather than the Foreign Sovereign Immunities Act.
I am running out of time but I will say and I would
emphasize that to the best of our knowledge this is private
Saudi money. There is no Saudi Government involvement in that
In my written statement, which has been filed for the
record, we do describe the fact that we are at something of a
critical juncture in that case now.
We are getting a great deal of push back from the
Department of State. That case is scheduled to go to trial in
August. We hope to keep it on schedule and we hope the
committee will assist us in doing that.
[The prepared statement of Mr. Perles follows:]
Mr. Poe. I want to thank all three of you for your superb
I will now recognize myself for some questions. Mr. Black,
I want you to be a little more specific, and I know that is
hard for you to do because you were very blunt and candid and
Is U.S. money going to pay prisoners in Israeli jails that
we would consider terrorists?
Mr. Black. The answer is yes. It is illegal. Our
Government, at the highest level, knows it is illegal. Every
hour of every day that this money continues to go to the PA you
risk the chance that another bus of more Americans will be
blown up, and they will receive an official salary from the PA.
The PA is continually in debt and it relies upon donor
countries for this money. Now, when you ask the PA are you
going to stop using our money to pay these terrorists'
salaries, they have a term for this and the term is called
It is all over the media. It is all over the newspapers. It
is in public remarks, and approximately 40 percent of the
entire PA budget comes from donor countries and much of the
rest comes from remittances.
There is no question that this country is supporting
terrorism. Not because somebody is publishing a Web site but
because somebody committed a specific act of terrorism and was
paid on a sliding scale for the number of people that he
killed. You are doing this now.
Mr. Poe. I am going to ask some more questions. Try to be a
little shorter, if you can. Briefer, I guess, is the answer--a
little more specific. You know, I was a former judge and so I
sent--I mean, people went to prison because they should have
But the idea that we pay people to go to prison and the
more serious the crime against society they get more money,
that is ludicrous. It would be ludicrous in this country but
now we are paying people overseas.
The prisoners that are in these Palestinian jails, have
they committed crimes against American citizens that are
directly or indirectly receiving money from American taxpayers?
Mr. Black. Short answer, absolutely yes.
Mr. Poe. How many people are in Israeli jails?
Mr. Black. Under this law, which only covers to terrorists
and does not cover shoplifters or burglars or any other types
of prisoners that are not national security offenses, it is
about 4,000. You said about 4,500.
That would cover everybody. It is about 4,000 and none of
them think they are going to serve the sentence that they are
given--5, 10, 20 years--because they all believe they are going
to get out in the next prisoner swap or the next prisoner swap
to discuss the next prisoner swap.
Mr. Poe. All right. There was a prisoner swap in October
where 1,000 or so got out of Israeli jails. How many of those
Mr. Black. They were all terrorists and----
Mr. Poe. Okay. Thank you. Are any of those--are any of
those people that are in Israeli jails--you know, terrorist
means different things to different folks. But are they members
of foreign terrorist organizations like Hamas?
Mr. Black. Many are not. Many are individual Palestinians
who have been impoverished by their own lack of enterprise in
the Palestinian Authority and see American and EU tax money as
a way to become wealthy in their own land, and they are just
individualized and incentivized by taxpayer money.
Mr. Poe. Dr. Pollock, Mr. Black testified earlier that some
of these prisoners are getting up to $10,000 a month. So what
is--you know, as we now understand, these are killers who
The more serious the crime, the more you get from the
Palestinian Authority. So what does a Palestinian that is not a
criminal making out there a month in--somewhere in Israel? Just
the average salary--monthly salary. Are they getting $10,000 a
Mr. Pollock. No, sir.
Mr. Poe. What are they making? Do you know?
Mr. Pollock. The per capita income in the West Bank is--
which is under Palestinian Authority rule, is estimated right
now to be approximately $4,000.
Mr. Poe. A month?
Mr. Pollock. No.
Mr. Poe. A year?
Mr. Pollock. A year, yes.
Mr. Poe. So you get $4,000 a year per----
Mr. Pollock. Per capita income. Right. Right.
Mr. Poe. Per capita.
Mr. Pollock. So, clearly, this----
Mr. Poe. Crime pays. Pays very well. The more serious you
commit the crime against Israelis, Americans, Western
Europeans, whoever, the more they are paid.
Mr. Pollock. Yes, sir.
Mr. Poe. And they can give this--understand, Mr. Black,
they control--the prisoner controls where the money goes. They
can give it back to a terrorist organization. They can give it
to their mother-in-law, their girlfriend.
Mr. Black. That is right. It is the POA and the POA changes
anytime they want it to change, and when I was in the British
Parliament a couple of weeks ago I--one of the parliamentarians
said this is welfare to the families. It is not welfare to the
families. It can go to anyone the guy designates, including his
own terror cell.
Mr. Poe. Two quick questions. Explain what the Prisoners
Club is and explain what happens when these terrorists who are
getting money to go to prison to kill people get out. What
happens when they get out? Quickly, briefly.
Mr. Black. When they get out they get a pension and the
pension--this is money for life. So while we don't have any
money here to pay our own pensions they are getting the pension
and the Prisoners Club----
Mr. Poe. Because they went to prison as a terrorist act
they are getting a pension.
Mr. Black. That is right.
Mr. Poe. Because they are part of the government now.
Mr. Black. And the Prisoners Club advocates to make sure
they get more money, more benefits, more bonuses, more
prioritization and job training.
Mr. Poe. Thank you.
I will yield to the ranking member from California, Mr.
Mr. Sherman. Thank you.
Dr. Pollock, thank you for your focus on the economic
vibrancy in Israel, and the judge and I have a bill to make
Israel a visa waiver country.
If that bill succeeds, we will see a lot more investment in
the United States because business people can't wait 3 or 4
weeks to go make a business decision. I have never seen a deal
that was worth doing that would wait 3 weeks.
And it would also be the answer to those who try to make
Israelis feel like pariahs we ought to put out the welcome mat
in the most important country in the world.
You have described enterprises on the West Bank. Do these
provide jobs for Palestinians?
Mr. Pollock. Yes, sir. They do. Most of Israel's economic
activity on the West Bank including settlement construction
provides jobs for Palestinians.
It is actually mostly Palestinian workers who are
physically building the new housing that the Israelis are
constructing in some of these settlements and being paid decent
salaries for that work.
Mr. Sherman. And the most recent controversies involved
Oxfam, an organization funded in part by the work of this
committee, criticizing one of its board members for being a
spokesperson for SodaStream.
Doesn't SodaStream--great soda, I might add--aren't most of
the employees Arab Palestinians?
Mr. Pollock. Yes, sir. Most of them are. It is a mix of
employees. You have Palestinians and Israelis working together
in the SodaStream manufacturing facility in the West Bank.
I might just add parenthetically that Prime Minister
Netanyahu, in his speech to AIPAC yesterday, specifically
referred to this issue and had what I guess you would call
colloquially a shout out to Scarlett Johansson and ended his
speech by saying, ``Frankly, my dear Scarlett, I do give a
Mr. Sherman. Mr. Black, among those getting these payments
from the PA for their terrorism, are there those who have
killed or injured American citizens?
Mr. Black. Yes. There are scores of American citizens who
have been killed or injured and many of the Palestinians who
are receiving these American-funded salaries are perpetrators
of those acts.
Mr. Sherman. I want to comment on some of the comments made
by my fellow Californians. I was with President Clinton when we
saw the PA charter changed and supposedly that was the
recognition of the Palestinians that Israel had a right to
They then retreated through an artifice to well, Israel has
a right to exist but only as a second Palestinian state, by
declaring that any Arab person who claims that any member of
their extended family ever lived in Israel, and just this is a
claim because there are no records from the Ottoman Empire.
It is not like you carried around a little ID from 1898. So
any Arabic-speaking person who makes that claim has a right to
go and live in Israel with their entire extended family. So we
saw that position.
Now, my colleague from southern California also points out
we have got to listen to the Palestinians and their leaders. He
is absolutely right. I have done a lot of that over the last 18
Privately, they know that Israel--that peace is--with
Israel as a homeland for the Jewish people, that the right of
return unless it is symbolic and of no practical importance has
to be swept away if there is peace.
The problem is they enjoy the political advantages of
fanning the flames loudly and then quietly tell Members of
Congress they know they have got to go in the other direction.
The problem is that they have boxed themselves in. I am
going to astound my colleagues and yield back with 24 seconds.
Mr. Poe. I thank the ranking member.
Before I yield to the other--one gentleman from California
I want to put in the record that while the EU boycotts Israel,
Iran is shipping arms to terrorists in Gaza. Earlier today, the
Israeli navy raided a ship in the Red Sea and seized dozens of
advanced rockets from Iran for the Palestinian terrorists in
These rockets had a range that could hit anywhere in
Israel. So we can't forget about the Iranians in all of this.
I will yield 5 minutes to the gentleman from California,
the ranking member of Europe, Eurasia and Emerging Threats--Mr.
Mr. Rohrabacher. Thank you very much, Mr. Chairman.
I guess what I am getting out of this is that the old
expression ``follow the money'' is very applicable here, and I
thank you, Mr. Chairman, and I thank the panelists today for
shining some light on where the money is coming from and
surprise, surprise, it is coming from us.
I mean, holy cow. So, I mean, one would think that you
follow the money you are going to end up in, you know, some
Damascus or Tehran and instead it is right here in Washington,
DC, and right here in some of the money that we are allocating.
That needs to be corrected and thank you for pointing that
out to us. Over the years, I have been in many hearings like
this where we discuss terrorism and we discuss attacks, and
terrorism is an attack on a civilian and the Palestinians in
this case have targeted civilians in order to terrorize a
population to achieve an objective.
And I--it seems to me that we have been listening to the
Palestinians and before, 20 years ago when I first came here it
seemed to me that Israel wasn't listening. It seemed to me that
Israel did not have a plan of how to deal with the Palestinians
and they weren't willing to.
They thought they should just disappear, become part of
some other country. Well, since that time I think Israel has
made tremendous concessions to the Palestinians.
They have given them territory and land and a sample
government that they could have once a full agreement is
reached and they have also recognized that the Palestinians
will have a right to a country as well.
And it seems to me we have seen lots of concessions from
the Israelis but I--as time has gone on, I haven't seen the
concessions from the Palestinians.
And as I say, I think all the Israelis that I have talked
to and all the Palestinians I have talked to have led me to
conclude that the only thing the Israelis really are looking
for is an actual guarantee that the Palestinians believe they
have a right to exist as a country.
One of these things that separated us, as I say, is the
right of return that the Palestinians keep claiming, which is
really a right to eliminate Israel as a country because it
would inundate what is Israel with a foreign population.
Is there a possibility that we could change this to a right
of compensation? Because the Palestinian argument is that in
1948 so much land was confiscated from Palestinians and these
people have not been compensated for that land, thus they own
it and thus they should have a right to return.
I will get to my point and that is should we, number one,
accept right of compensation as something that perhaps could be
an alternative to the right of return, and number two, where
would you get that money and just--I want to throw this out to
the panel as well--when people talk about compensating people
for those--that property that they lost--the Palestinians lost,
at the same time, in the 1940s Jews left lots of land behind
and lots of property behind in countries--Middle East
Whether it was Egypt or whether it was Syria or whether it
was Iraq or whether it was Iran, there were many Jews that were
forced out of their homes and property and I don't believe they
were ever compensated either.
Perhaps we could tell the governments that now have that
valuable property that the Jews left in 1948 that that property
should be used as a means of compensating the Palestinians for
the property that they lost. What do you think about that idea?
Mr. Black. Well, I wrote a book about that called ``The
Farhud'' about that very point. Approximately 790,000 Jews were
expelled from Arab countries. Shortly after the state of Israel
began they were made stateless. All of their property had been
They had dwelled in peace in the Middle East for 1,000
years before Mohammed. They were sent to expulsion camps. The
earrings were pulled from their lobes.
The bracelets were yanked from their wrists and they were
forced into Israel by these Arab countries to create a
demographic time bomb. There was a small airline that was
Mr. Rohrabacher. To get right to the point is that was a
lot of valuable property.
Mr. Black. That was millions.
Mr. Rohrabacher. And so that valuable property, just a
thought, Mr. Chairman, that----
Mr. Black. And it was registered, by the way.
Mr. Rohrabacher. That could be--that might be able to be
used as a source of money by those countries to compensate the
Palestinians for the property they lost when Israel became a
country. Just a thought.
Thank you very much, Mr. Chairman.
Mr. Poe. Thank you, Mr. Rohrabacher.
I do want to correct something for the record. I called you
the ranking member of your subcommittee, much to the delight of
my friends to the left. But you are the chairman and you will
stay the chairman, I suspect, a long time.
But anyway, I now recognize the gentleman from California,
Mr. Vargas, for 5 minutes.
Mr. Vargas. Thank you very much, your Honor. I do call you
your Honor because I know you were a judge, too.
Mr. Poe. And you need to call me that.
Mr. Vargas. Yes, sir, and I always do.
First of all, I have to say it almost seems impossible to
believe that our Government is indirectly funding terrorists in
prisons in Israel and--I mean, we certainly have the witnesses
I think we need to bring the--some representative from the
government forward, Mr. Chairman, at some point to either
refute it or to say that is the case because this is outrageous
if it is the case.
Again, I had not heard about it previously. It hasn't been
reported on any of the news stations that I watch. But it is
outrageous and not a penny should go, of course, to any
terrorist and we need to get to the bottom of this. That is why
I thank you for bringing this forward.
I do want to ask some questions. The question was asked of
us and we could ask you by yourselves about BDS--boycott,
divest and sanctions--where the money is coming from. So I
would ask you where is this money coming from.
It seems, unfortunately, that they are picking up some
steam throughout the world and it is very unfortunate because I
don't see it anything less than just anti-Semitism--a little
bit shielded but not much.
Could you tell us where the money is coming from for this
movement? Dr. Pollock, you look like you are able to answer
Mr. Pollock. Thank you. Thank you for the question.
You mean money to fund the BDS movement?
Mr. Vargas. Yes. Yes, sir.
Mr. Pollock. Yes. Well, I think not enough--at least to my
knowledge, not enough solid research has been done on exactly
that question so far and my--so I am going to give you my
judgement and impression.
And that is that the money comes from a variety of sources
all over the world and there are some governments including,
for example, the South African Government that is----
Mr. Vargas. Not our Government, though. Please tell me it
is not our Government at least.
Mr. Pollock. Not to my knowledge.
Mr. Vargas. Okay. Good.
Mr. Pollock. That are active in funding chapters that are--
of different organizations that are engaged in promoting
boycotts against Israel.
There are some academic institutions and societies, student
organizations, for example, on various universities including
some here in the United States, that are very active in
I think their funding comes from a variety of individual
donations and foundations. I am not personally aware of any
government money that supports it.
Mr. Vargas. Okay. Mr. Black, I saw that you were anxious to
answer the question. Do you know, sir?
Mr. Black. Yes. The number-one source of BDS funding is
taxpayers. Here is how it works. 501(c)(3) organizations--you
all remember the investigation I did on the Ford Foundation in
which they were funding all these anti-Semitic groups--
501(c)(3) groups raise money and donate it to organizations
involved in the BDS.
For each million dollars of tax exempt money, American
taxpayers have to pony up $440,000. The number-one organization
which has been associated with this process has been the New
Israel Fund which gave hundreds of thousands of dollars to the
Coalition of Women for Peace so that they could create a global
infrastructure of boycotts including a database called Who
They stopped giving this money in 2011 but now they
continue to give hundreds of thousands of dollars to
organizations like Breaking the Silence, Adalah and Bisallam,
which are absolutely essential to keep the BDS alive. New
Mr. Vargas. Thank you.
Mr. Perles, do you have an answer to that, too?
Mr. Perles. I do not, sir.
Mr. Vargas. Okay. I think that that is something that we
need to act on also then. I see this movement. Of course, it
has become somewhat worldwide now and it seems to have a lot of
money and it seems that someone is orchestrating.
Again, it is nothing less than veiled anti-Semitism. I
guess my last question would be, you know, how do we then--how
do we move forward then to make sure that these groups don't
get the money--that our Government is not involved or
What would you do, Dr. Pollock? What would your solution
Mr. Pollock. Thank you, again, for the question.
I think there could be, as my fellow witness just noted,
there could be an opportunity to investigate the tax exempt
status of organizations that might be knowingly or unknowingly
funding activities that are either illegal or improper or not
eligible for tax exempt status because they are political
That is one possibility. But I do think that the most
significant way of addressing this issue is by raising public
awareness about it and I don't think that this is a lost cause
even in Europe, if I may say so with all due respect, to any
Europeans who might be here.
I do think that there are organizations in Europe who are
certainly advocating BDS but there are also organizations, very
good ones, in Europe that are actively opposing it and fighting
against it and they deserve----
Mr. Vargas. My time has expired so I am going to thank you.
Mr. Pollock. Thank you.
Mr. Vargas. Thank you, Mr. Chairman.
Mr. Poe. I thank the gentleman.
The Chair will recognize the gentleman from Pennsylvania,
Mr. Perry, for 5 minutes.
Mr. Perry. Thank you, Mr. Chairman, and thank you,
So this policy, this official policy, how long--how long
has this been in force? Mr. Black, anybody?
Mr. Black. Are you talking about the Law of the Prisoner?
Mr. Perry. Yes.
Mr. Black. The Law of the Prisoner goes back years. It was
an unofficial policy before it was regularized into Palestinian
law. The actual law itself was--and its qualifications were
read to me over the phone by the Minister of the Ministry of
They have an entire ministry devoted to this. So it is
years. And may I also say that while----
Mr. Perry. Ten years or more?
Mr. Black. Or at least 10 to----
Mr. Perry. Okay. So it is nothing new, and to be clear,
just to make sure I understand this, there is no direct State
Department money that we can tell going to the--going to this
program or is----
Mr. Black. I didn't say that.
Mr. Perry. Okay. You suggest----
Mr. Black. I believe the money is going directly. Of course
it is. It is fungible. You can't give money to an al-Qaeda soup
kitchen and then say oh, and but this soup kitchen money is not
going to go to feed the troops.
Mr. Perry. So if I can just give you a scenario and you can
validate it for me. So State Department funds some USAID
project in the--in the area and then that money is
misappropriated and--at least portions of, and then put toward
Mr. Black. The money goes into the PA. The PA doesn't have
its own currency. We are now investigating the routes by and
the foreign accounts that the PA uses and then the PA divvies
up the money and they borrow from various accounts including
the army account, the military account, the police account
Mr. Perry. Okay. So does the--does the State Department
just wholesale give an appropriation to the PA?
Mr. Black. In some cases, yes.
Mr. Perry. What is the level of funding, do you know? Do
you have any idea what kind of money?
Mr. Black. Well, I know what it is in England and hear a
number of $440 million. I am not sure if it is block grants or
if it is targeted money. But all of this money goes into one
pot, fungible. It comes from the--a Latin word that means
Mr. Perry. Is there no--is there no accounting on the--on
State Department's side for exactly how each dime is spent?
Mr. Black. They don't want to account for it.
Mr. Perry. Okay. So who would be--is there--is there a
person at State? Is there an agency--is there a person at State
that we can turn to, bring in here and have a discussion with
that would be responsible for the accounting?
Mr. Black. He is currently in Europe.
Mr. Perry. Who is that person?
Mr. Black. Secretary Kerry.
Mr. Perry. Thank you.
So there has been a law on the books, in my understanding,
since 1990 regarding victims of terrorism that has been where
the United States could extradite these individuals that have
perpetrated the alleged crime.
To your knowledge, how many--how many folks since that
time--I think there have been, according to what I am reading
54 U.S. citizens killed in Palestine terror attacks.
How many of those perpetrators that are alive--not,
obviously, the ones that have blown themselves up, you can't do
much with them--but the ones that have lived through their
attacks have been extradited back to the United States for
Mr. Black. That is a legitimate question. I am going to
pass it to this gentleman here.
Mr. Perles. Mr. Perry, first, let me thank you for the
compliment in your opening remarks. It is very much
appreciated. I think you need to divide the world of
Palestinian terrorist attacks into two different categories.
If you are talking about Palestinian terrorist attacks that
occur outside of Israel such as aircraft hijackers--for
example, we represented three U.S. nationals who were shot in
the head execution style and tossed out of an aircraft in
Malta--the surviving Palestinian terrorist in that attack
served 6 years in Malta and then was freed without notice to
the United States.
The U.S.--the FBI chased that man to the end of the earth,
dragged him back out of Africa. He was prosecuted here in the
U.S. District Court for the District of Columbia and is
currently serving a life sentence.
We do a very good job--the Justice Department, we as a
nation, the Justice Department does a very good job for attacks
that occur outside of Israel. With respect to attacks that
occur inside of Israel, to the best of my knowledge no one has
Mr. Perry. Why is that?
Mr. Perles. I think that is a--that is a----
Mr. Perry. What is--what is your opinion?
Mr. Perles. My opinion?
Mr. Perry. Yes. This is what you do. This is what you
Mr. Perles. This is what I do. We have had a lot of
discussions with the Department of Justice over the years. One
of my clients, Steve Flatow, who lost a daughter, Lisa, in a
terrorist attack remains quite active in this area.
I think it is the view of the Department of State that were
the United States to prosecute a Palestinian terrorist for acts
of terror committed in Israel that it would somehow interfere
with the ability of the Department of State to stand as a
neutral or the onus----
Mr. Perry. So my time has expired. I appreciate your
Mr. Chairman, just let me--does that--does that policy cut
across the political grain in the United States, both
Republican and Democrat administrations, or is there a
difference? With your indulgence, Mr. Chairman.
Mr. Perles. No, no. There is no difference.
Mr. Perry. Okay. Thank you. I appreciate your input.
Mr. Poe. The Chair recognizes the gentleman from
California, Mr. Lowenthal, for 5 minutes.
Mr. Lowenthal. Thank you. I want to follow up with the same
line of questioning the first, I think, Congressman Vargas
raised and then Congressman Perry about. It is so shocking for
us to hear about how U.S. funds are directly or indirectly
supporting salaries for convicted terrorists.
I think our assumption has always been that much of those
funds really are--you know, we promote through USAID toward
local economic growth or the well being and creation of
stability which will lead--economic stability which will lead
toward political stability.
So the question I am raising is if these funds, as Mr.
Black has--are co-mingled, they are then--whatever funds go in
to this big pot and then out of that pot, what are you
suggesting that we do right now?
Mr. Black. Okay. Peace is possible in the Middle East. Some
35,000 Palestinians a day make a 1-hour to 2-hour ride to work
in equality in Israeli jobs.
But peace doesn't have a chance when you are paying people
to commit murder. What I would do if I were you, and I am not--
I have no standing here.
Mr. Lowenthal. Absolutely, but we are just asking what you
Mr. Black. I would immediately by sunset stop all money to
the PA until this one program, this one law, is rescinded, then
claw back all of these moneys that have been paid over the
years to kill innocent civilians, and then resume the process
along the lines that Kerry and others have suggested, which is
pay for peaceful coexistence and do not pay for murder. This
House must stop paying for murderers. Stop it today.
Mr. Lowenthal. Thank you.
Dr. Pollock, do you have any response to that? How are we--
where do we go from here?
Mr. Pollock. I do agree that this PA policy is abhorrent
and that the United States should play no part, if we are, in
At the same time, I think that the peace process as it is
currently underway, as I understand it from press reports
because many of the details are--have not been released
officially--as I understand it, the peace process that is
currently underway is indeed addressing many of these issues
about coexistence, about settlements, about refugees both
Jewish and Arab, about compensation for past losses, about all
of the other issues that are standing in the way of peace.
And so I think it is important whatever we do--in my own
personal view, whatever we do about terrorist funding or other
issues to maintain a peace process and peace negotiations
between Israel and the Palestinian Authority.
That is also an important and essential part of the way
forward, in my view. I would point out one other aspect of
this, which is very closely related to it, and that is
incitement to violence and to terrorism on the part of the PA--
officially Palestinian Authority in Ramallah.
I am not speaking here of Hamas, which we know incites to
terrorism and violence against Israelis and Jews. But the PA
itself under Mahmoud Abbas and sometimes, I am sorry to say,
Mahmoud Abbas himself are also guilty of incitement to violence
and terrorism by glorifying terrorists.
Not just paying salaries for them but by calling them
heroes and role models for future generations. This is
something that I personally have spent the last couple of years
analyzing and documenting and speaking to both Israelis and
Palestinians about in great detail.
And I published on the Washington Institute Web site, if
you will permit me just sort of an unpaid commercial here, a
very long report about this called ``Beyond Words: Causes,
Consequences and Cures for Palestinian Authority Hate Speech''
where I document and analyze the reasons for and also the
remedies for this kind of rhetorical official glorification of
terrorism on the part of the Palestinian Authority. This too is
an issue that I think needs to be addressed in the context of
the current peace talks.
Just as seriously as we talk about Jerusalem or refugees or
Israeli security or any other issue, the issue of incitement
and hate speech needs to be part of these diplomatic----
Mr. Lowenthal. Thank you. Mr. Perles, do you have anything
Mr. Perles. I would. You know, I must say I apologize. I am
not as colorful as my colleagues are here. Maybe I am more of a
But speaking as the--speaking as the technocrat, what we
found in the Arab Bank case and in order to meet our burdens of
proof in this kind of litigation we really need to track this
money and tie particular payments to particular acts of
What we find is what I could best describe is an abuse of
bank secrecy--that is Palestinian bank--Palestinian Authority
bank secrecy laws, Jordanian bank secrecy laws, Lebanese bank
The problem really is very much akin to Credit Suisse using
Swiss bank secrecy laws to hide, if I read the newspapers
correctly recently, the economic accounts of some 22,000
Americans who were engaged in income tax evasion.
In the Arab bank case, I believe a total of five Federal
judges--two district court judges, three Federal appellate
judges--have now accrued discovery sanctions against the Arab
bank for its failure to turn over discovery. The bank is
relying inappropriately in the U.S. court system on
Palestinian, Jordanian and Lebanese bank secrecy laws. That, by
the way, is the nub of our current dispute with the Department
Mr. Lowenthal. Thank you, and I yield back.
Mr. Poe. The Chair recognizes the gentleman from Florida,
Mr. Yoho, for 5 minutes.
Mr. Yoho. Thank you, Mr. Chairman. I appreciate it.
Gentleman, I appreciate you being here and I find it
unacceptable that since mid-1990s we have given $5 billion to
the Palestinian Authority in aid is what I have come up with
and there is no accountability.
And I see it over and over again that we give foreign aid
for these countries and, like you said, it is under a mushroom
and we know what that means--the growing environment of a
mushroom--and that is what I feel like a lot of the time.
You said that you would cut it off by tonight. What would
be the ramifications if we were to do that, Mr. Black?
Mr. Black. You are being extorted right now. You are giving
in to it. Basically, the idea is if we stand up to terrorism
they are not going to sign a peace deal. They are never going
to sign a peace deal as long as they are being paid for
Mr. Yoho. Right.
Mr. Black. Stop this funding today, and if it is that
important to them as they say it is, that they would rather
starve than stop this program, then they have spoken for
I believe that people in this neck of the woods want peace,
Arab and Jew. But you must give peace a chance and you can't
keep rewarding this bad behavior.
If this--if this program is stopped forcibly by U.S.
cessation of funding, there will be a lot of noise and that
would just typify what the Arab street is like. But it will
We just can't put people on salary for killing Americans,
Israelis and Europeans----
Mr. Yoho. I agree.
Mr. Black [continuing]. In the most uncivilized fashion.
Stop it tonight if possible.
Mr. Yoho. Dr. Pollock, you were talking about the boycott.
If the PA and Israel, if an agreement does not work in the
peace process, do you see the boycott getting worse and
increasing or do you think it is going to be a nonissue?
Mr. Pollock. I think in Europe it will increase and I would
like to quote for the record a statement by the EU Ambassador
to Israel who said recently, and this is--this is a quote of
what he said, not my opinion.
``If the talks are wrecked as a result of an Israeli
settlement announcement then the blame will be put
squarely on Israel's doorstep. Israel will find itself
increasingly isolated not necessarily because of any
decisions taken at a government level but because of
decisions taken by a myriad of private economic actors,
be it companies, be it pension funds, be it
This is the EU Ambassador to Israel.
Mr. Yoho. Are you saying--are you finding that--is there
anti-Israeli sentiment about the acquisition of land over the
Mr. Pollock. Yes.
Mr. Yoho. Is that why they are doing this?
Mr. Pollock. Yes. Yes.
Mr. Yoho. They are just getting to a point to where they
are saying they are not going to tolerate this anymore? Is that
the sentiment you are seeing?
Mr. Pollock. Yes. That is correct.
Mr. Yoho. I guess I want to ask all of you this. Do you
feel the release of the PA prisoners in Israel was a wise move
with Secretary Kerry going over there and demanding that? Mr.
Perles, if you want to start.
Mr. Perles. I can answer in a very succinct fashion. No.
Mr. Yoho. Dr. Pollock.
Mr. Pollock. I think that this was an Israeli Government
decision, not an American demand, and the Israeli Government
had a choice of whether or not to prefer a settlement freeze or
a prisoner release and they chose a prisoner release.
Mr. Yoho. Mr. Black.
Mr. Black. Well, you have to ask yourself why was it so
imperative that the killers be released, and that is because
the PA places a high premium on those among its citizens that
Mr. Yoho. Okay. And then--let us see--would you say the
U.S. Government, particularly the State Department, is helpful
in assisting the victims in these cases, Mr. Perles, in your
Mr. Perles. You know, that is a--that is a difficult
question for me to ask in a--or a difficult question for me to
answer in a public forum.
Mr. Yoho. Do you want to submit your answer?
Mr. Perles. Let me--let me say that it takes a lot to get
the State Department motivated to help people. They are not
culturally, as an institution, helpful. When they decide that
they're going to help people, they are tremendously effective.
So that what I have could best be described as a
relationship in constant tension with the State Department.
Most of the time we are in an adversarial posture. In the Arab
bank case, for example, we are currently in an adversarial
When Libya claims the reconciliation process was going
forward, the Department of State determined that the interested
victims and the Department's interests were synonymous with one
another and the department was tremendously effective in
assisting victims and creating a settlement with the Libyan
In fact, at the request of the Department of State's legal
advisor's office I went with then legal advisor John Bellenger
to a DC bar lunch honoring him and spoke his praises through
the work his office had done in support of terror victims in
So the answer is we have a very complicated relationship
that is always a tension.
Mr. Yoho. Okay. I am out of time and I appreciate all three
of you. Thank you. Thank you, Mr. Chairman.
Mr. Poe. I thank the gentleman. The Chair will recognize
for 5 minutes the gentleman from Illinois, Mr. Kinzinger.
Mr. Kinzinger. Thank you, Mr. Chairman.
It is interesting. This is a very interesting subject and,
you know, if we look at the wider Middle East and we look at
what I would call negotiations in Iran, you know, I think it is
Even though that is not the actual issue we are here to
talk about it is important to stress that I don't see any way
that with the interim agreement with Iran that we end up seeing
an Iran without the capability to enrich Uranium.
And so you see what is happening in those negotiations. You
see what is happening with the issues we talk about and there
is a lot to be very concerned with. And so I appreciate the
three of you coming here.
I am probably not going to take all 5 minutes and as--I had
another hearing and so I came a little late so if these
questions have been asked I apologize.
But Mr. Pollock, what can Israel do to diversify its trade
beyond Europe so that this doesn't have quite the impact and
Israel can be strong without these boycotts?
Mr. Pollock. Yes, that is an excellent question. Thank you.
I think that the Israelis, both the private sector and the
Israeli Government, are already trying to move in that
direction as a kind of fail safe, just in case.
But the reality is that for the foreseeable future it is my
professional judgment that the EU and other European countries
who may not be in the EU will remain very, very important trade
and investment partners for the Israeli economy.
And so the Israeli Government is currently engaged in
trying to estimate in a, I think, straightforward factual way
what the consequences for the Israeli economy would be in the
case of--in case this boycott, divestment and sanctions
movement does gather strength in Europe.
But I want to emphasize that this is a potential threat. At
the moment, it is not a real threat to the Israeli economy.
European countries and European companies continue to trade on
an increasing scale with Israel and to invest on an increasing
scale with Israel and to send tourists at increasing volumes to
This is not true of every single European country. You do
see a pattern in which some of the Scandinavian countries and
Holland in particular and Ireland in particular are pulling
back to some extent from those economic relationships with
But that is more than offset by increasing economic
relationships with the other larger European economies.
Mr. Kinzinger. Yes. I mean, I think, obviously, it is in
Europe's interest to have these great relationships and if you
are going to push any of your power anywhere maybe it ought to
be somewhere like Russia right now, something like that, with
what is going on.
Mr. Pollock. Yes. I would agree with you, sir. If Europe is
going to impose sanctions it should be against Russia, not
Mr. Kinzinger. It might make sense. It has been said that
the official Palestinian position is against boycotts. Can you
elaborate on that?
Mr. Pollock. Yes. Thank you.
Again, President Abbas was asked about this question on the
occasion of the Nelson Mandela memorial service in South Africa
not long ago and he said quite publicly, and I want to
emphasize this was in Arabic to an Arab audience so it counts
He said that the PA officially opposes boycotts against
Israel. He said we, Palestinians, are negotiating with Israel.
Therefore, how can we ask other people to boycott Israel if we
are not boycotting Israel.
Now, subsequently, unfortunately, and this is a pattern in
Palestinian official messaging--subsequently, that statement
was walked back and watered down and I would say almost
contradicted in statements by other senior Palestinian
officials--not Abbas himself but some of his more senior
colleagues in the PA Government who said, for example, that we
don't advocate boycotts against Israel but we do advocate
boycotts against settlements.
Or that we don't advocate boycotts against Israel at a
government level but we do advocate private boycotts against
Israel. Or who simply said, as Hanan Ashrawi did very
publicly--she is a member of the PLO executive committee and an
important spokeswoman for the PA Government--who said that
boycotts against Israel should be supported and that BDS should
be supported because it is, again, as she put it, ``the
Palestinian nonviolent resistance'' against Israeli occupation.
So what you have is a mixed message from the Palestinians.
Mr. Kinzinger. Thank you. Mr. Black, just quickly--when
these folks receive this money that you are talking about is
there anything that restricts them from giving that money to
further terror causes?
Mr. Black. None at all. They have a POA, a power of
attorney. It can change from time to time and they designate
who the recipient is.
If the recipient is their girlfriend or their terrorist
cell or their attorney or their mother it can go any--to any
destination that they choose.
Mr. Kinzinger. Thank you.
Mr. Chairman, I yield back.
Mr. Poe. I thank the gentleman. I appreciate the witnesses
for your excellent insightful testimony. Mr. Perles, especially
on a personal note, thank you for the work you do for victims.
Thank you very much.
Mr. Perles. Thank you, sir.
Mr. Poe. Thank you, gentlemen. Oh, you have another
Mr. Sherman. No, not a--just a----
Mr. Poe. Comment?
Mr. Sherman. I also want to commend Mr. Perles for his
record, and as an old tax lawyer a couple of things for the
You just talked here that if you get a 44 percent Federal
tax subsidy for these charitable contributions I think that is
an insult to my former colleagues and tax lawyers who wouldn't
settle for less than 60, 65 percent subsidy when you can make
gifts of appreciated capital gain property reduce state as well
as Federal income taxes.
Also as to tax administration, a big chunk of the PA's
revenue is remitted to them by Israel, which collects for the
PA their tariffs and value added taxes.
The decision as to whether money, which is fungible, should
be turned over to an organization that does some good things
and does some absolutely terrible things is one we will wrestle
with in the future.
I yield back.
Mr. Poe. I thank the gentleman. I thank the gentlemen once
again for their testimony.
This committee is adjourned.
[Whereupon, at 11:29 a.m., the committee was adjourned.]
A P P E N D I X
Material Submitted for the RecordNotice deg.