Terror Victims Sue MasterCard for $591M

MANHATTAN (CN) - MasterCard helped Iran hide $591 million it owes victims of the 1996 bombing of the Khobar Towers in Saudi Arabia, families claim in Federal Court.

A truck bomb destroyed or damaged six high-rise buildings in a housing complex near the headquarters of Saudi Arabia's state-run oil company, killing 19 U.S. servicemen and one Saudi national and injuring 372 others on July 25, 1996.

U.S. authorities identified Hezbollah as the responsible party, and the FBI's three-year investigation concluded that Iran sponsored it.

Seventy-eight family members of the fallen U.S. officers and airmen have fought in Federal Court to hold Iran liable for its role. They won their first judgment against Iran about a decade after the attacks.

Iran has refused to pay, claiming al-Qaida was responsible.

The plaintiff families say they found out this June that MasterCard was frustrating their collection efforts.

"By letter dated June 15, 2012, the respondent informed the U.S. Marshal that the respondent transferred all funds in the name of certain Iranian banks that are agencies and instrumentalities of Iran, to JPMorgan Chase Bank in New York, where it is now being held in two blocked accounts," the complaint states.

"However, the specific arrangements by which these funds have been transferred to JPMorgan Chase Bank is unknown. It is also unknown what interest, rights and/or responsibilities, if any, MasterCard may claim with respect to the blocked accounts."

The families claim that Iranian agencies have an interest in the blocked accounts.

They demand that MasterCard turn over that money, plus post-judgment interest, under the Terrorism Risk Insurance Act of 2002.

They are represented by Cary Samowitz of with DLA Piper.

MasterCard emphasized that it has no connection to $591 million judgment, and that it has already given up the "relatively small amount of funds" in its possession meant for Iranian banks.

It says it transferred such funds to a U.S. depository institution in compliance with sanctions regulations.

"MasterCard no longer has any interest in or control over such funds," the company said in an email to Courthouse News.

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