New Developments in the Netanyahu and Bank of China Case
December 18, 2013
The secret unit that operated against the flow of money to fund terrorism and the threat from china that caused the Prime Minister to fold.
A document filed yesterday by a terror victim’s family in a New York court reveals for the first time: a secret unit of the Mossad and the Shin Bet exposed terror money laundering in a big Chinese bank ● Israel promised to the family of Daniel Wultz: we will help with the testimonies if you sue the bank ● The moment China threatened to cancel Netanyahu’s visit, he surrendered and made a deal: the visit will take place, and in consideration the state will prohibit the witnesses from testifying in the trial ● Nahum Barnea and Simon Schaefer
The Secret Deal Comes to Light
A legal document that was filed yesterday in the Federal court in New York exposes for the first time the existence of a secret unit of the Mossad, the Shin Bet and the National Security Council for foiling the flow of funds from abroad to Palestinian terrorist organizations. The unit was formed in 2002 and was subordinate to the Prime Minister and the head of the Mossad at that time, Meir Dagan.
The unit recruited terror victims’ families for the purpose of filing legal claims against banks and other financial institutions that enabled the money transfers. The heads of the unit were two former senior officials: Uzi Shaya and Shlomo Matalon. The Government of Israel provided the families with the intelligence information and promised to send officials on its behalf to testify in the trials. The decision was made in cases where the Mossad’s approaches to the foreign governments were rejected.
This document was filed to the court as part of the lawsuit brought by the Wultz family, whose son Daniel Wultz was killed in a terrorist attack in Tel Aviv in 2006, against Bank of China, one of the biggest banks in the world. The Prime Minister Netanyahu and his decisions play a central role in the new document.
Container of Schoolbags
The Chinese bank’s involvement with terror money was unfolded at length in prior articles in “Yedioth Ahronoth”. According to the new document, in 2005, the intelligence sources in Israel discovered that the Islamic Jihad and the Hamas receive millions of dollars from a Palestinian businessman’s family that operates in Guagzhou, in south China. The funds were laundered through accounts with Bank of China and were sent to Gaza as merchandise, the consideration for which was transferred to the military arms of the terrorist organizations. The sources of the money were in Syria and Iran. Two branches of the Palestinian Shurafa family, one in China, and the other in Gaza, operated the net.
“The government of Israel tried on multiple occasions to intercept the flow of the laundered funds”, says the legal document. “In September 2007, for example, the Israeli customs stopped a container of schoolbags and clothes that was addressed to Gaza and the consideration for which was supposed to go to the Hamas and the Jihad”.
According to the document, after it was found out that the flow through the Chinese bank continues, Dagan decided – with the permission of the Prime Minister Sharon – to send to China a few senior intelligence officials in order to convince the Chinese government to close the bank accounts. At that time Bank of China was fully owned by the Government of China. From 2005 to 2007, they came a few times to China, met with representatives of the Chinese bank, the Ministry for Public Security and other government clerks that didn’t identify their positions. Separately, Stuart Levey, the American Acting Treasury Secretary, held meetings with Chinese officials on the same web of issues (details about Levey’s meeting were disclosed in the WikiLeaks documents).
Four Israeli officials who were part of the delegations to China are mentioned in the document filed with the New York court: Shaya, Matalon, the Head of the National Security Council, Dani Arditi, and “L”, whose full name is still privileged.
The diplomatic talks failed. “The Chinese representatives notified the delegation that Bank of China decided not to close the accounts”, was written in the document.
Preaching To The Choir
In the face of the refusal, Israel decided to switch strategies, says the document. “The Mossad and the Prime Minister’s Office approached the terror victims or their lawyers in order to enable them to bring lawsuits. Israel promised to provide the required information and testimonies”.
In the case of Wultz, the approach was made to “Shurat Hadin” headed by Nitsana Darshan-Leitner. Nitsana Darshan-Leitner located the Wultz family. After some time the family chose to work with a different law firm, an American one.
“In order to prevent a situation where the hopes of the terror victims that were recruited as plaintiffs are raised in vain, and to make sure that the lawsuits that will be brought against Bank of China will not be dismissed, Shurat Hadin’s lawyers demanded from the Government of Israel that the Government provide not only specific information and signed affidavits but also an authorized witness that will appear in front of the court and testify about the meetings with the owners of the bank. Shaya and ‘L’ gave this promise after they received Dagan’s approval. Based on this, the Wultz family filed the lawsuit”.
And indeed, the Government of Israel provided to the family and its lawyers the full intelligence information about the terror money from China. An affidavit signed by Shlomo Matalon that specified Bank of China’s wrongs was also provided to the court. “Today Israel is claiming that this information is confidential, and a testimony about it will harm the national security”, says the document.
In January 2011 Dagan retired from the Mossad. “In October 2011”, claims the document, “governmental sources started asking questions about the promise to permit Uzi Shays to testify in New York. Main questions were regarding additional information against China that was in Israel’s possession and was not provided until then”.
During all this time the family received promises from the Prime Minister Office and the Israeli Embassy in Washington that everything is okay, there is no change in the policy. The Chairman of the House Foreign Affairs Committee, Rep. Ileana Ros-Lehtinen also received a similar promise.
In the meantime the court forced Bank of China to disclose internal documents that confirmed that Israel was engaged in negotiations with the bank, and that China demanded from Israel, during the case, to deny any prior contacts.
On March 20 this year Shaya sent a letter authorized by Israeli officials that set forth the framework for his testimony. The moment the Chinese found out about the letter, they took a dramatic step.
“Days after the delivery of the letter, Chinese government’s clerks contacted the Israeli Ambassador in China, Matan Vilnai, and threatened that if Shays testifies, the government of China will cancel the invitation to the Prime Minister Netanyahu, his wife and children to visit China. Vilnai immediately reported to Netanyahu.”
“In order for the visit to take place, Netanyahu secretly decided to notify the Government of China that he will not allow Shaya or any other present or former Israeli official to testify in New York. And indeed, on May 6, Netanyahu and his big entourage left for a 5-day visit that included meetings and tourism”.
After months of preparation, says the document, the Government notified Shaya that it is reconsidering the promise given to the family to allow him to testify. If before then he was presented with documents to refresh his memory, now he was denied access. In a meeting in May, Shaya explained to the father, Yekutiel Wultz, that “there is a serious pressure that is gradually increasing from the Government of China on the Government of Israel to prevent my testimony”.
In June, the Head of the National Security Council at the time, Yaakov Amidror, spoke with Yekutiel (Tuly) Wultz. A transcript of the call exposes the trap Netanyahu fell into. “On the call Amidror admitted that Bank of China was involved in something that should not be done. However testimony on these actions will not be given despite the promises given by the Government. Wultz expressed surprise and disappointment from the change in the Government of Israel’s approach and its surrender to the Chinese pressure. Amidror didn’t deny that Netanyahu essentially surrendered to the Chinese pressure. He provided additional explanation: the purpose of the lawsuit was to make the Chinese bank promise that it will change its policy. This purpose was achieved.
“When Wultz said “it can’t be that the Chinese bank will not deal with the consequences of its actions, they were accomplices to the murder of my son”. Amidror chose to answer in English: You, Mr. Wultz, are convincing the convinced (the expression in English is: “you are preaching to the choir”). If the Chinese bank is not punished, Wultz said, it will give green light to other banks in the World to cooperate with terror. Amidror repeated the same expression: You are convincing the convinced”.
According to the document, the government of Israel chose, then and until this day, the foot-dragging tactic. As opposed to the reality, the documents provided did not talk about a decision but an examination of the subject without any time limits. This was also the language in the letter sent by the Israeli Ministry of Justice’s officials to the court.
The document has two purposes: one is to convince the court to deny the Chinese bank’s demand to dismiss the case because the key witness will not come to testify; the second purpose is to reject the Israeli claim for immunity for the witness and the information due to national security reasons.
The Chinese conundrum should raise heavy questions not only in New York where the trial takes place or in Florida, the residence of the Wultz family or in Washington, the capital that bears most of the burden of the worldwide fight against terror. It has to raise questions also here, in Israel.
Even if the Government of Israel agreed to open a new page in the subject of terror following the lawsuit in New York, the fact that the Government of Israel recruited a bereaved family and abandoned it all alone in the battlefront is horrifying. This is not the heritage that the national security services in Israel are proud of. We are not speaking only about one family but tens of families that filed lawsuits in New York based on the lawsuit of the Wultz family. The surrender to the Chinese pressure questions the entire system: there is no point to recruit families, to engage lawyers, to occupy foreign courts if the Government is not capable of honoring its promises.One question touches upon Netanyahu and the connection between his family visit to China and the decision that was made in the Prime Minister’s Office on the eve of the visit. Netanyahu sees himself as a moral and political leader of the worldwide fight against terror. There is no one like him as it comes to emotional speeches against terror; there is no one like him as it comes to promises to fight terror till complete distraction. This pretension was lost in the way he and his people dealt with the Chinese conundrum.