Banks such as Chase Bank, Bank of America, and TCF Bank have closed several accounts owned by clients of Middle Eastern descent. The clients, according to McClatchyDC, include Diba Mortazavi (a medical researcher), Saeed Moshfegh (a physics Ph.D student), and a Miami businessman with the pseudonym “Rami Abboud.”
When reflecting on Chase Bank’s closure of her account, Mortazavi remarked that “They just went ahead without any kind of warning. They just closed my account and I found out on my own.” Bank of America, meanwhile, froze Moshfegh’s account without warning and threatened to close Abboud’s account unless questions regarding his citizenship were answered.
Recounting his phone call with Bank of America, Abboud shared his surprise. “Are you [expletive] kidding me? You are reconfirming my date of birth after almost 30 years?…then she asked if I had dual citizenship. I am very upset.”
Mortazavi, Moshfegh, and Abboud’s stories resonate with others in the U.S. For example, TC Daily Planet reports that from 2012 to 2014 in Minnesota, 30 clients with Middle Eastern surnames saw their TCF Bank accounts closed without explanations.
Gadeir Abbas, senior litigation attorney for the Council on American-Islamic Relations (CAIR), alleges that it’s Islamaphobia.
“It is what it looks like, the closure of bank accounts held by Muslims or those mistaken as Muslim. It’s Islamaphobia…something is systematically happening that is resulting in the closure of bank accounts held by Muslims and Islamic institutions.”
Indeed, something is systematically happening, and although these big banks failed to provide the clients with explanations, the Council on Foreign Relations (CFR) shares relevant information.
In the “efforts to dismantle terrorist financial networks,” freezing bank accounts plays “an essential part of Washington’s strategy,” according to CFR’s publication Tracking Down Terrorist Financing. In Abboud’s case, the fact that he was a businessman may have raised extra flags, since “many terrorist organizations attempt to operate legitimate businesses, which generate their own profits and can also be used as a front for money laundering.”
Banks, then, must walk a fine line that has no margin for error when freezing accounts. Slowness to freeze or close accounts increases the probability that terrorist financial networks will strengthen. Hastily freezing or closing accounts, however, produces a consequence where clients with no connection to terrorist groups have their bank accounts frozen or closed.
The Equal Credit Opportunity Act (ECOA) prohibits discrimination in any aspect of a credit transaction, according to the Federal Deposit Insurance Corporation. If the affected bank clients decide to file a lawsuit against banks for ECOA violation, a decision may not easily be reached since banks will probably claim that they were acting in the interest of national security.
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