FNB to close accounts of organisations targeted for US sanctions

2013-01-21 15:16

First National Bank will terminate its relationship with any entities on the United States Treasury’s list of organisations targeted for economic and trade sanctions.

This was in response to a question relating to its plan to close the account of the pro-Palestine Al Aqsa Foundation of SA (Aafsa), which said it supported more than 1?000 orphans in South Africa every month.

“FNB would have and will take the same decision with regards to any [Office of Foreign Assets Control] OFAC listed entity,” said FNB commercial banking CEO Michael Vacy-Lyle.

The issue arose when Aafsa questioned the banking group’s plan to close its account on March 31 this year because it was on the list.

According to Aafsa’s website, the list enforces “economic and trade sanctions based on US foreign policy and national security goals against targeted foreign countries and regimes, terrorists, international narcotics traffickers, those engaged in activities related to the proliferation of weapons of mass destruction, and other threats to the national security, foreign policy or economy of the United States”.

Aafsa said that in the course of trying to resolve the issue, the bank had told it it had done nothing wrong. Aafsa said it was a legal, non-profit organisation registered with the social development department and was compliant with the SA Reserve Bank.

It said FNB claimed it was not compelled to subscribe to global networks which refused to trade with organisations on the list.

“However, they asserted their choice to close Aafsa’s account was based on possible financial losses and international isolation from these networks should they continue their relationship with the Aafsa,” the organisation said.

Aafsa said it had shown the banking group that its name and that on the OFAC list were not the same. The bank had said it should get legal advice on the assertion of mistaken identity.

It said FNB had said it would change its decision if a case of mistaken identity was proven. It agreed to approach the SA Banking Council about this, because the situation might arise again with other organisations, and it needed to know how to deal with the matter.

“Despite the agreement to further investigate the matter, the bank has refused to extend its 31 March deadline for the permanent closure of the Al Aqsa Foundation of South Africa’s account,” it said.

Aafsa had limited transactions, with no withdrawal facility and believed no other bank would open an account for it in South Africa.

“This will force a reputable, decade-old organisation that supports 1?500 orphans every month to shut its doors, thus terminating the only lifeline these children have,” it said.

Vacy-Lyle confirmed the decision to close the account.

“It has come to the bank’s attention that the foundation is expressly listed by the US Department of Treasury, [OFAC] and other international sanctions lists. The listing of the foundation has been verified with reference, inter alia, to the addresses contained in the listings documents.

“The international financial community impose stringent obligations in respect of the maintenance of banking relationships with entities listed by OFAC, and the decision by FNB to terminate its relationship with the foundation is a consequence of this fact alone,” he said.

The account would be closed with reasonable notice.

On its website, Aafsa describes itself as “providing for the religious, cultural and social needs of the poor and needy Palestinians living within the West Bank, Gaza, Lebanon and Jordan”.

Join the conversation!

24.com encourages commentary submitted via MyNews24. Contributions of 200 words or more will be considered for publication.

We reserve editorial discretion to decide what will be published.
Read our comments policy for guidelines on contributions.

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
Comments have been closed for this article.

Inside News24


Amazing solar inventions!

Solar power is lighting up the world, and not just on rooftops anymore.



Prince George the green prince?
One man's $1 million vision for an eco Africa
China's air pollution at doomsday levels
Keep food fresher for longer

Book flights

Compare, Book, Fly


There is a tendency to get too caught up in group dynamics and high expectations and ideals, that your own personal needs and...read more

There are new stories on the homepage. Click here to see them.


Create Profile

Creating your profile will enable you to submit photos and stories to get published on News24.

Please provide a username for your profile page:

This username must be unique, cannot be edited and will be used in the URL to your profile page across the entire 24.com network.


Location Settings

News24 allows you to edit the display of certain components based on a location. If you wish to personalise the page based on your preferences, please select a location for each component and click "Submit" in order for the changes to take affect.

Facebook Sign-In

Hi News addict,

Join the News24 Community to be involved in breaking the news.

Log in with Facebook to comment and personalise news, weather and listings.