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St. Louis attorney sues foreign banks alleging they helped Iran sponsor terror; Suit modeled after case filed in May

By The Madison County Record | Nov 29, 2016

Law money 09

EAST ST. LOUIS – Lawyers who for 12 years have pursued claims that banks helped Iran sponsor terror attacks have earned the high compliment of imitation.

John Driscoll of St. Louis copied their theory and many of their facts in a suit he filed against eight banks at U.S. district court in November.

Driscoll represents estates and families of 18 persons who died in Iraq, as well as veterans who survived attacks with injuries.

He seeks damages under the federal Anti-Terrorism Act against Deutsche Bank, HSBC Bank, Barclays Bank, Standard Chartered Bank, Royal Bank of Scotland, Credit Suisse, Bank Saderat and Commerzbank.

The suit alleges that each bank conspired with Iran to evade U.S. economic sanctions and arms embargoes, knowing Iran would use some of the funds to kill and maim Americans serving in Iraq.

Deutsche Bank already faced a terror suit in the same court.

The lawyers who filed it had won a jury verdict of liability against Arab Bank in New York two years ago, in the 10th year of litigation.

Arab Bank has appealed, delaying trial on damages.

The same legal team sued HSBC Bank in 2014, in New York.

They also sued Deutsche Bank this May, in East St. Louis.

Their suit seeks damages for wounded veteran Charles Shaffer, his father Charles Shaffer, and Rhonda Kemper, mother of the late David Schaefer.

Deutsche Bank counsel John Hall, of Covington and Burling in Washington, moved to dismiss the suit.

Hall also moved to stay discovery pending a ruling on the motion to dismiss, and brought the motion to Magistrate Judge Stephen Williams in August.

Hall told Williams, “There is absolutely no precedent for the claims that have been brought here.

“We are going to be investigating bombing attacks that occurred on the battlefield in Iraq.”

Plaintiff counsel Gary Osen of Hackensack, New Jersey, responded by saying, “What Deutsche Bank and other banks agreed to do was to hide from U. S. law enforcement, from regulators, the fact that these transactions were going through the United States. We don’t allege that the bank’s subjective motive was anything but its own financial improvement.”

Osen said that in conspiring with Iran, it is almost inevitable that some of the money will be used for life threatening activity.

“They didn’t want their transactions to be detected, because they wanted to be able to have the discretion as to how to use the money,” Osen said.

Williams granted the stay.

Osen opposed the motion to dismiss later in August, quoting a consent order between the bank and the New York State department of financial services.

He wrote that the bank admitted that its managers and others worked with sanctioned Iranian customers to conceal details of payments, and that the bank admitted it formally and informally emphasized the need for utmost care in keeping sanction-related information out of messages.

“Deutsche Bank knows it is too big to jail,” Osen wrote.

He wrote that the bank knew its criminal conduct would not result in prosecution of employees. At most, it would face fines or be forced to improve compliance.

“In sum, it fully expects to get away with murder,” Osen wrote.

Deutsche Bank’s local counsel, Troy Bozarth of Hepler Broom in Edwardsville, wrote that plaintiffs hadn’t alleged that a single dollar ended up in the hands of terrorists responsible for their injuries.

“Whether Deutsche Bank’s actions are best viewed as a failure of compliance policies and procedures, as the New York department of financial services saw it, or something else, they certainly do not resemble an attempt to get away with murder, as plaintiffs argue,” Bozarth wrote.

The motion to dismiss awaits a decision by District Judge Michael Reagan.

Driscoll filed his complaint on Nov. 2.

He described attacks in language identical to Osen’s complaint against HSBC, changing nothing but the names of the victims.

District Judge Nancy Rosenstengel received the assignment but recused herself.

The suit passed to Senior Judge Phil Gilbert, who reassigned it to District Judge David Herndon on Nov. 22.


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