Unfortunately, with all our understanding of your situation, in light of this, in the circumstances of the case, we cannot determine that the bank's policy is unreasonable." [emphasis added]
- This detailed and orderly response by the Supervisor of Banks therefore confirms that the bank acted in a reasonable manner, and that in view of the freezing of assets on those entities that are included in the sanctions list, it cannot return the funds to the sender and cannot transfer them to the plaintiff. The funds are therefore at this stage, in a designated transition account. In any event, after the examination carried out by the Supervisor of Banks in relation to the plaintiff's application to him, it was determined that there was no defect in the bank's conduct.
- It should be noted that in the statement of claim, the plaintiff seeks to hold on to the fact that the Supervisor of Banks' letter was sent to the banks in June 2022, while the refusal to transfer the funds to his account was in March 2022, and therefore it was argued (paragraph 44 of the statement of claim) that the bank cannot hold on to this reply, which was given retroactively as a reason for not transferring the funds.
- This claim of the plaintiff should be rejected. The Supervisor of Banks' letter to the Supervisor of Banks from June 2022 did not fundamentally innovate, since by virtue of NBAT 411, the bank is obligated to maintain an active policy of prohibiting money laundering and terrorist financing on entities that have been sanctioned. The letter clarified that the banks' refusal would not be considered an unreasonable refusal, and it came to ratify the actions of the banks that withheld funds as a result of those sanctions.
- What is stated in this chapter is intended to explain the normative framework that begins; To clarify that the delay of funds coming from banks in Russia that are subject to international sanctions is part of the anti-money laundering and anti-terrorist financing risk management policies under which the banks are obligated to act, and that the conduct of the defendant bank was also examined by the Supervisor of Banks (including in relation to the case before us) and was not found to be unreasonable. More on this later.
D.2. In accordance with the Supreme Court's ruling, the Bank is obligated to uphold, adopt and implement the Supervisor of Banks' risk management policy, and as long as it acts in accordance with this policy, this is not an unreasonable refusal to provide banking service, and therefore it is not a breach of the Bank's obligations:
- In the framework of Civil Case 59756-12-23 Zaka-Rescue and Rescue Locator et al. Mizrahi-Tefahot Bank (January 30, 2024), the District Court granted a request for temporary relief, in which the Applicants petitioned that the Court instruct the Bank to transfer a donation in the amount of ILS 8 million from Mr. Abramovich's account that is managed by the Bank. The bank refused to transfer the donation in light of the sanctions imposed on Abramovich in the European Union and the United Kingdom, which the bank voluntarily adopted.
The District Court was of the opinion that the sanctions do not apply in Israel and therefore there is no impediment to the transfer of the funds. See paragraph 39 of the decision: