Blacklisted by the bank
In an age of homeland insecurity, financial institutions add layers of scrutiny that some critics call overzealous.
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For months, Fleet Bank refused to give Algabri - and his lawyers - a reason for shutting down his account. After two meetings with bank officials, Algabri found out that a one-time withdrawal of $7,000, as well as his habit of depositing different checks in individual envelopes at the same time, constituted suspicious behavior.
While banks are not required to shut down accounts - as they are when a name appears on the OFAC list - the government does instruct institutions to be prudent. In most cases, that means closing down the account.
"The institution has to make a decision," says John Byrne, senior counsel at the American Bankers Association. "A 314 is a serious demand ... if they are contacting you, it's for a good reason."
But doubts remain about mistaken identities. "People get accused, then cleared, and there is no repercussion for accusing anyone," says Merrie Najimy, president of the Massachusetts branch of the American Arab Anti-Discrimination Committee. "Banks can hide behind ... the Patriot Act and can get away with what they want."
Consumers have also found themselves on unofficial lists spun from an FBI suspect list generated after Sept. 11. "That list got into private hands," says Lara Flint, staff counsel at the Center for Democracy and Technology in Washington. "Many on that list have long since been cleared, but they are still feeling the ramifications," she says. "It's one example of how a list can get out of control."
Financial institutions acknowledge that closing customer accounts is not good business. Wire companies, for example, have been hit hard by having to disrupt customer transfers.
"And it has created a good deal of acrimony [among customers]," says Jorge Guerro, president of the National Money Transmitters Association. "They don't understand that we are under obligation by the government."
As Sept. 11 showed, seemingly insignificant transfers can support colossal terrorism. Now, corporate America is especially eager to show it is doing "the right thing," says W. Michael Hoffman, executive director of the Center for Business Ethics at Bentley College.
Still, there is a fine line between violating customers' rights and allowing terrorist money to flow through an institution, he says. "They must set up clear and transparent protocols for conducting any investigation."
Some call those protocols unclear. "The question is, how does one get oneself off one of these secret government watch lists?" asks Flint. "I think that's still an unanswered question."
Of the 15 people whose accounts have been closed in Boston, only Algabri has fought back.
"It draws attention to you, in your community," Algabri says. "It places a big question mark over your head." Most of his peers have opted to quietly set up accounts elsewhere.
"People feel powerless to do anything, so they've resigned themselves to being targets," says Salma Kazmi, assistant director of the Islamic Society of Boston Cultural Center. "People just want to get on with their lives."
