The war business is out of control

Speech by Terry Crawford-Browne to FAFO Institute Norway on the arms deal, Israel and Palestine, November 19 2012

Speech by Terry Crawford-Browne to the FAFO Institute, Oslo, Norway, November 19 2012:

The War Business Is Out Of Control: have the "99%" neither recourse nor remedy?

I am greatly honoured to have been invited to speak here at FAFO, a highly regarded and progressive institution in a city, Oslo, which itself is internationally held in such high respect.

We in South Africa owe a huge debt of gratitude to Scandinavians, and others in the international community. Norway, in particular, made a unique contribution in awarding the Nobel Peace Prize to Albert Luthuli in 1960, to Desmond Tutu in 1984 and jointly to Nelson Mandela and FW de Klerk in 1993. Thank you.


The American President Dwight Eisenhower, in his farewell address in January 1961, famously warned about the rise of the military-industrial complex, and the risks that it posed for democracy. He said:

The potential for the disastrous rise of misplaced power exists and will persist. We must never let the weight of this combination endanger our liberties or democratic processes.[i]

Eisenhower was ignored, and for the next three decades the world teetered on the brink of nuclear catastrophe. Military spending eventually bankrupted the Soviet Union, as it did apartheid South Africa, and is now bankrupting the world.

Ironically, apartheid in South Africa might have lasted another half century, except the "securocrats" squandered our national resources on nuclear weapons and other "toys." The Bush administration embarked upon its "war on terror" in the bizarre belief that wars would regenerate the American economy. Even worse, war is marketed as a game and our children are conditioned to believe that violence is the norm.

I was a banker before becoming a peace activist. The first time I actually met Archbishop Desmond Tutu was at the United Nations in October 1985 where, with Dr Beyers Naude, we launched the international banking sanctions campaign. It was a last non-violent initiative to head off a civil war. Thankfully, banking sanctions proved to be the tipping point in the struggle against apartheid.

We had five objectives:

a) The end of the state of emergency,

b) Release of political prisoners,

c) Unbanning of political organisations,

d) Repeal of apartheid legislation, and

e) Constitutional negotiations towards a non-racial and democratic South Africa.

The world had long predicted a racial bloodbath in South Africa. Just over four years later, President De Klerk began the transition when he announced the release of Nelson Mandela. Banking sanctions worked because American churches, with encouragement from Archbishop Tutu, told the seven major New York banks to make a choice between the churches' pension fund business and the banking business of apartheid South Africa.

Because of the role of the US dollar as settlement currency in foreign exchange markets, access to the New York payments system was crucial. For example, even third-country trade between South Africa and Japan and/or Germany is "settled" in US dollars, and would have been impossible without correspondent bank relationships with those New York banks.

Three decades ago, apartheid in South Africa was the moral issue of the time. Today the issue is apartheid in Israel-Palestine.


Sadly, the struggle against apartheid has been betrayed, and our much-vaunted constitutional democracy hangs in the balance. Just as the world anticipated a peace dividend with the end of the Cold War we, in South Africa, had high expectations. We again need your help.

Like vultures, the armaments industry regrouped. South Africa became one of its first targets. Shamelessly, European politicians flocked to pay tribute to our new democracy with one hand, and to peddle weapons with the other. Archbishop Njongonkulu Ndungane appointed me to represent the Anglican Church at the parliamentary Defence Review during 1996-1998. There, we argued there that eradication of poverty was post-apartheid South Africa's priority.

The arms traders found no shortage of opportunists ready to sell-their-souls to the war business. The premise of the arms deal was that US$5 billion spent on warships and warplanes from Germany, Britain and Sweden would generate US$18 billion in offsets to stimulate economic development, and create over 65 000 jobs, It was described as a "Marshall Plan" for the new South Africa. Allegations of corruption soon followed.

I asked the British government in 1998 to investigate whether BAE was bribing our politicians and, to my astonishment, learned it was not illegal in English law to bribe foreigners. In Germany the bribes were even tax deductible as "useful business expenses." The advisor to Swedish Prime Minister Goran Persson in 1999 admitted that offsets are internationally notorious for corruption, but told a conference in Cape Town that "lower standards apply in the third world."

I understand that the Swedish TV4 programme Kalle Fakte on Wednesday night will reveal how BAE laundered some of the bribes through Swedish trade unions.

A handful of ANC politicians and their business cronies who were penniless twenty years ago are now millionaires and even billionaires. They revel in the description of "black diamonds," and ostentatiously flaunt their new wealth. The gap between rich and poor is wider now than during the days of apartheid.

The title of my book Eye On The Diamonds relates to the fact that BAE bribes of £115 million were laundered through a front company in the British Virgin Islands called Red Diamond Trading Company. You will know that the Virgin Islands produce no diamonds. Instead, the British colony is a tax haven for almost one million registered companies, and is notorious for money laundering operations.

The British Secretary for Trade and Industry, Patricia Hewitt in 2003 admitted that BAE had paid "commissions" (for which read bribes) to secure its contracts with South Africa but, she pleaded, those bribes were "within reasonable limits." I am pleased to know that BAE is blacklisted by the Norwegian Pension Fund.

Diamonds were the symbols of British colonial conquest of both India and South Africa. When Sir Winston Churchill's father, Lord Randolph Churchill, visited the Big Hole (the world's largest man-made hole) in Kimberley in 1891, he gasped in amazement: "All this for the vanity of women." A quick-witted woman bystander replied: "And the depravity of men."[ii]

Add in religion with sex, oil, money, diamonds and war, and the combinations are explosive.

Diamonds became the rocks on which apartheid and migrant labour policies were built. The compound labour system still operating in 2012 in Marikana originated in Kimberley with De Beers back in 1870s and 1880s. Cecil Rhodes died in 1902, and the Oppenheimer family took control of De Beers in 1934 during the Depression when the company faced bankruptcy.

Rhodes Scholarships at Oxford University funded by South African diamonds and gold remain the world's most prestigious scholarships. Their purpose was to induce the United States back into the British Empire so that together the British and their American "cousins," in the cause of world peace, would create a military power that could never be challenged.

The reality, unfortunately, was that the first half of 20th century became the bloodiest period in history. The slogan in 1945 was "never again" before the world embarked on another 45 years of the Cold War.

Rhodes's seemingly bizarre vision has nonetheless become a "special relationship" and "Atlantic Alliance" within NATO. British naval control of the seas has been superseded by American airpower. New technologies of electronic surveillance, biometric identification and drone warfare are far more powerful and destructive than anything to date.

During the Obama administration, the US has moved far beyond bayonets and battleships to cyberwarfare and full scale weaponisation of space. The intention is that by 2025 US global military power will equalise for America's relative economic decline.[iii]

At its zenith, De Beers controlled 95 percent of the world's diamond supply. It was a monopoly not only of exceptional longevity, but was based upon marketing myths that diamonds are rare, priceless, and essential to every girl's love life. Equally extraordinary, De Beers employed Queen Elizabeth and Hollywood movie actresses as salesladies. Even James Bond was brought in to convey the mystique of secrecy and national security in the 1971 film "Diamonds Are Forever."

Racial abuses and gross exploitation were not limited to South Africa, but were exported to Namibia (South West Africa) where diamonds were discovered in 1908. South West Africa was a League of Nations mandate territory after the First World War, and was supposed to be administered by South Africa as a "sacred trust" on behalf of its indigenous population. In reality, South West Africa was little more than the Oppenheimer family's private colony.

Possession of an uncut diamond was, and remains, a very serious offence. Vast areas of both countries were designated "forbidden areas" where trespassers risked a bullet in the back. I'll come back to diamonds, but let me first focus on the arms deal and BAE.

There was, and remains, no conceivable foreign military threat to justify spending US$5 billion on the arms deal. We have the bizarre reality of 24 BAE Hawk and 26 BAE/Saab Gripen fighter aircraft, but no pilots to fly them, no mechanics to maintain them, and even no money to fuel them. The three German submarines are also inoperable, and lie on the hard in Simon's Town harbour. And, similarly, the four frigates rarely go to sea.

Corruption is rampant. The country has been in a state of shock since August 16th when the Police shot dead 34 striking miners. It is the worst national crisis since the Sharpeville massacre in 1960. South Africa's credit rating has slumped, the rand has weakened, and scenario planners such as Clem Sunter reckon there a 25 percent possibility that South Africa will become a "failed state."[iv]

The world, not just South Africa, is being held hostage by an organisation of crooks - arms companies, politicians, generals, journalists and bankers. Their priority is fear-mongering, and then to fleece the taxpayers by lobbying for ever-increasing expenditures on weapons. Arms purchases are described as simply "insurance" in an uncertain world.

You will recall that British Prime Minister Tony Blair in 2006 squelched a Serious Fraud Office (SFO) investigation into BAE bribes being paid to members of the Saudi royal family, and spuriously claimed the investigation threatened British national security.

In November 2008, the Scorpions - South Africa's counterpart of the FBI - raided BAE premises in Pretoria and Cape Town, and seized 460 boxes and 4.7 million computer pages of evidence.[v] The Scorpions had similar files about the German Frigate and Submarine consortia.

One week after that raid, I prevailed upon Archbishop Tutu and former President De Klerk to issue a joint petition to President Kgalema Motlanthe requesting him to appoint a judicial commission of inquiry into the arms deal.

Motlanthe dismissively told us to take our information to the Police. When President Jacob Zuma came to office in June 2009 he, similarly, responded that there was no case to answer.

The Scorpions were then disbanded for political reasons related to 783 charges of arms deal corruption allegations against Zuma. The Scorpions handed over the evidence to their successors, the politically-malleable Hawks. The chief of the Hawks confirmed to Parliament in September 2010 that there was such a huge volume of evidence around the arms deal that it would take ten years to analyse it all.

The Hawks announced two weeks later that the investigations had been abandoned. I then filed an application in the Constitutional Court that, given this mountain of evidence, it was irrational and thus unconstitutional for Zuma to refuse to appoint an investigation.

The President's legal counsel was unable to refute that reality. Zuma then very reluctantly agreed to appoint the Seriti Judicial Commission of Inquiry. I made my submission in June 2012.

Backed by a legal opinion from a senior advocate, I argue that offsets, and thus the arms deal itself, fail the requirements of section 217 (1) of the Constitution and, that the arms deal was therefore illegal and unconstitutional right from inception. As predicted, the offset "benefits" never materialised and were fraudulent, and were simply vehicles to pay bribes.

The international remedy for fraud is to cancel the contracts, return the equipment and recover the monies. The principle applies that fraudsters should not financially benefit.

Similarly, the "remedies in case of bribes" clauses in the arms deal contracts give the government the right summarily to cancel the contracts, and even to claim damages. SAAB, ThysenKrupp and Ferrostaal do not dispute and openly confirm that bribes were paid to secure their contracts.

Amongst the documents that I submitted to the Constitutional Court are 160 pages of affidavits by the SFO and the Scorpions that detail how and why BAE laundered those bribes of £115 million, to whom the bribes were paid, and which bank accounts were credited.

In addition, a source in England in 2002 supplied me with the 255 pages of the 20 year Barclays Bank loan agreements which are underwritten by the Export Credit Guarantee Department (ECGD) to finance the BAE contracts until 2019.

The documents have been verified in court as authentic, and were described by the legal counsel for the former Minister of Finance as "potentially catastrophic for South Africa." In my opinion as a former international banker, the representation, covenant and default clauses are a textbook example of third world debt entrapment by British banks and governments. The ECGD has a very dubious reputation for casting a blind eye to corruption on British export deals, and BAE is by far its largest client.

Barclays Bank was by far the largest foreign lender to South Africa when the apartheid government defaulted on its debts in 1985. The recent Barclays LIBOR rate-fixing scandal and the HSBC Mexican drug laundering scandal have again highlighted that the City of London is sometimes referred to as the most corrupt square mile anywhere on the planet Earth. The British do corruption with panache!

You will also recall how Blair in 2003 ignored British legal and public opinions when he and President George Bush (Junior) embarked upon the illegal war against Iraq. Just a few weeks after the SFO episode in 2006, the Guardian newspaper revealed that BAE with collusion of the British defence department had laundered bribes of over £1 billion to Saudi Prince Bandar. Those bribes had been laundered mainly through Riggs Bank in Washington DC, where for 22 years Bandar was the Saudi ambassador to the US.

So the FBI became involved, and wanted to know why BAE was laundering bribes through the American banking system. Riggs Bank was subsequently put into liquidation. BAE was fined US$479 million but, instead of being blacklisted from supplying the Pentagon, continues to do business in the US, which accounts for more than 50 percent of its sales.

Whilst BAE's Saudi Arabian contracts are the "big one," South Africa ranks number two. In addition, there have been numerous other corrupt BAE transactions with Chile, Czech Republic, Rumania, Qatar, Tanzania, etc. The vested interests of the war business are very powerful.

The £43 billion Al Yamamah contracts were originally negotiated by Prime Minister Margaret Thatcher in 1985.[vi] Bandar was exceptionally close to President Ronald Reagan and also to both Presidents Bush, senior and junior. Bandar was the main facilitator who orchestrated the Afghan mujahideen against the Soviet Union during the 1980s, and again was the "bagman" for the Reagan administration's Iran-Contra scandal.

The Al Yamamah deal was so corrupt that a British National Audit Office report in 1992 remains suppressed even from British parliamentarians. The weapons were paid for by shipments of between 300 000 and 600 000 barrels per day of Saudi Arabian oil consigned to the Bank of England, which distributes the oil to BP and to Shell.

A surplus accumulated over the years is estimated to be worth about US$160 billion. The Al Yamamah deal was followed in 2007 by the Al Salam contracts negotiated by Blair, hence his sensitivities to the SFO investigations. BAE is organised crime on a scale that makes the Italian mafia look like saints.

Bandar was also a very frequent visitor to South Africa during the Mandela presidency, and was the only foreigner present during Mandela's secret wedding to Graca Machel. Very curiously and unusually, Bandar's biography by William Simpson entitled The Prince includes not just one but two forewords.[vii]

One foreword is by Thatcher, and the second is by Mandela - both of whom describe Bandar in glowing terms for his contributions to world peace. Just weeks after the book's publication, the Guardian exposed the bribes paid to Bandar by BAE with collusion of the British government.

Mandela admitted that at least US$60 million in contributions to the ANC flowed from Saudi Arabia. South Africa's foreign policies, including arms sales, are determined according to payments to the ANC, which however refuses to open its books to public scrutiny on the spurious reasoning that the ANC is a private entity.

Similarly, British investigators are prevented by the British Official Secrets Act from exposing the real function of the Al Yamamah agreement negotiated by Thatcher and Bandar, and renegotiated by Blair in 2007. The purpose of the Bank of England "slush fund" is reportedly:

a)      To guarantee British and US support for the Saudi royal family against domestic insurrection,

b)      To fund covert destabilisation of resource-rich countries in Asia and Africa,

c)       To support the role of the US dollar as the basis of the international monetary system by pricing oil in dollars, and by massive purchases of US and British arms.

Orchestrated by Bandar under the guise of the "war against terror," Saudi money is lavishly used to destabilise countries such as Afghanistan, Pakistan, Somalia, Yemen, Libya, Syria and Nigeria.[viii]

A bizarre alliance has also emerged between Saudi Arabia and Israel to isolate and attack first Iraq, and now Iran. The International Atomic Energy Agency (IAEA) as early as 1998 concluded that Iraq's past nuclear weapons programme had been neutralised, but Israel in 2003 prevailed upon the US and Britain to launch an illegal war against Iraq on the deliberately faulty pretexts of "weapons of mass destruction."

Likewise, both the IAEA and US intelligence services concluded in 2007 that Iran as long ago as 2003 had abandoned its ambitions to develop nuclear weapons. Yet Israeli Prime Minister Benjamin Netanyahu and Defence Minister Ehud Barak have deliberately and falsely ramped up international hysteria about Iran developing nuclear weapons. The Israeli journalist Yossi Melman has noted:

Netanyahu and Barak so desperately crave war that they sought in 2010 to provoke Iran into striking first so that Israel could claim to be the victim of Iranian aggression, and thus drag the US into a long, bloody and hugely expensive war.[ix]

Israel and the Saudi royals feel threatened by the rise of Iran, the crumbling of the old order, the end of brutal dictators, and the explosion in the Arab world of popular political and religious passions.[x] Bandar was deployed last year to suppress the uprising in Bahrain, where 80 percent of the population is Shi-ite and where the US maintains a naval base.[xi]

The Saudi/Israeli nexus includes Saudi funding for Mossad assassinations of Iranian nuclear scientists. As if recklessly adding gasoline to a fire, the US and Britain in 2012 have been pouring weapons into Saudi Arabia, the United Arab Emirates and Israel. The consequences of an Israeli attack on Iran could be a conflagration extending from China across Asia and Africa to Nigeria.

British Prime Minister David Cameron declares:

I can understand why some people are a bit squeamish about me flying off round the world to help our defence industry do deals abroad. So, when Britain has a very strong defence industry with 300 000 jobs depending on it, it is right that we should be at the forefront of this market supporting British jobs and British allies, and that's why last week in the Gulf, I was pushing for new contracts for Typhoon jets worth billions of pounds and thousands of jobs.

Cameron also declares his support for the City of London, saying that the financial services sector contributes one-eighth of the government's revenue in taxes and underpins jobs for two million people. He says critics want to "trash the banks":

Yes, some utterly terrible mistakes were made, and they need to be addressed properly so that they can never happen again. Those who think the answer is just to trash the banks would end up trashing Britain. I say recognise the enormous strength and potential of our financial sector, regulate it properly and get behind it. [xii]

The reality however, is that both the British arms industry and its banking industry are virtually without regulation, and scream vociferously whenever regulation is suggested. Opening up the Bank of England/Al Yamamah slush fund or closing down the money laundering operations in the British Virgin Islands (or other British tax havens) does not seem to be part of Cameron's agenda.


Israel has an estimated 200 to 300 nuclear warheads, the technology of which was funded by apartheid South Africa during the 1970s and 1980s, with payments being laundered via diamond transactions.[xiii] Israel refuses to join the Nuclear Non-Proliferation Treaty, or to open its nuclear facilities to international inspection.

Connections between South Africa and Israel go back to the early days of Zionism. Theodore Herzl wrote admiringly to Rhodes that he intended that colonisation of Palestine would be modelled after Rhodes's British South Africa Company. Similar to myths of South Africa as an empty land when the Dutch arrived in 1652, Zionists created the myth of Palestine as "a land without people for a people without a land."

Rhodes and Herzl, respectively, died in 1902 and 1904, Rhodes at the age of 49. The British imperialist Lord Alfred Milner -- Rhodes's cohort in instigating the Anglo-Boer War of 1899-1902 - took up the cause of Zionism. Milner in 1917 became the main drafter of the Balfour Declaration. His intention in settling Jews in Palestine was that they would help secure the Suez Canal for the British Empire as the route to India.

Given their involvements in development of the diamond and gold industries, South African Jews by the 1930s were the most affluent Jewish community anywhere in the world. They were also enthusiastic supporters of Zionism, and the Africa-Palestine Investment Company was established in 1934 to buy land in Palestine.

Africa-Palestine Investment Company was in due course renamed Africa-Israel Investment Company. Lev Leviev bought a 75 percent interest in the company in 1997. It is now one amongst several Israeli companies blacklisted by the Norwegian Pension Fund.

Although Israel produces no diamonds, its cutting and polishing industry contributes 35 percent of Israel's exports. The industry claims that 50 percent of all diamonds are traded through Israel. In turn, Leviev boasts that he is the man who broke the De Beers cartel. With the collapse of the Soviet Union, Leviev gained access to the Russian diamond industry and, from there, the Angolan diamond industry.

Activists are pretty certain that Leviev is the money-man behind the Marange diamond fields in Zimbabwe, which may prove to be the world's largest diamond field. Use of a front company in the British Virgin Islands blocks proof of that suspicion. Canada Africa Partnership on November 12, 2012 released its report that:

At least US$2 billion worth of diamonds have been stolen and have enriched President Robert Mugabe's ruling circle, international gem dealers and criminals.[xiv]

Under the auspices of the UN Security Council in the aftermath of the "blood diamond" experiences in Sierra Leone, the World Diamond Council (WDC) established the Kimberley certification process as an effort to end the use of diamonds to fund wars in Africa. The WDC has made extravagant claims of success. In limiting certification to rough stones, the definitions of blood diamonds have been watered down to exclude diamonds cut and polished in Israel.

In challenging De Beers, Leviev had laundered the proceeds of blood diamonds through Africa-Israel Investment Company and its subsidiaries by illegal construction of settlements in the "West Bank." Its subsidiaries, including Danya Cebus, are the leading building contractors in Zufim near Jayyous, Har Homa near Bethlehem, and Ma'ale Adumin between Jerusalem and Jericho.[xv]

The De Beers' control of the diamond industry has slumped from 95 percent to 35 percent. So ruthless are the Israelis that the Oppenheimer family have "seen the writing on the wall," and in November 2011 sold their 40 percent interest in De Beers. The extent of the Marange diamond field, as well as other discoveries elsewhere, highlights the abundance of diamonds and negates the carefully crafted myths that they are rare and priceless.

Nonetheless, diamonds far eclipse drugs for their money laundering opportunities. Low grade industrial diamonds are also an essential commodity for the war industry, both in the manufacture of precision machine tools and for high-energy laser technology.

Israel is also the world's leader in surveillance equipment and unmanned aerial vehicles (drones). This drone technology was developed in conjunction with South Africa during the 1980s. A young computer programmer -- seated in air-conditioned comfort thousands of kilometres from a war zone - can obliterate communities in Pakistan, Afghanistan, Yemen, Palestine or Somalia. According to the Bureau of Investigative Journalism in London, 350 American drone strikes just in Pakistan over the past eight years have killed up to 3 378 people. The US also orchestrates drone strikes in Yemen and Somalia from a secret base in Djibouti.[xvi]

The war business is now truly out-of-control.

In addition to support for the struggle against apartheid in South Africa, the Oslo Accords of 1994 illustrate Norwegian commitment to resolution of the Israeli-Palestinian conflict. Yasser Arafat, Shimon Peres, Yizhak Rabin were jointly awarded the Nobel Peace Prize. Unfortunately, those heady expectations proved misplaced.

There are now over 700 000 Israeli settlers living illegally "beyond the green line," and stealing Palestinian land and water.[xvii] This makes a two-state solution a practical impossibility. The intention of Israeli governments is to make life so impossible for Palestinians that they "voluntarily" emigrate.

Archbishop Tutu declares:

The issue of a principled commitment to justice lies at the heart of responses to the suffering of the Palestinian people and it is the absence of such a commitment that enables many to turn a blind eye to it.... If you are neutral in situations of injustice, you have chosen the side of the oppressor. 

During the sanctions campaign against apartheid South Africa, Swiss bankers unctuously told us that Switzerland is neutral. Of course, money is not neutral, and Switzerland was heavily complicit in supporting the apartheid regime. Money is an instrument that can be used, either for good or for evil.

The Norwegian Pension Fund is the largest such entity in the world with assets in September this year of NOK 3.7 trillion (US$650 billion).[xviii]

Like apartheid South Africa during the 1970s and 1980s, Israel is a highly militarised society where "national security" trumps the rule of law, economic rationality and human rights. Quite simply, the generals and their business cronies are making mega-money from war profiteering. The last thing they actually want is peace.

The Norwegian Pension Fund took the first step in blacklisting Elbit - the Israeli arms company in 2009. In 2010 it blacklisted Africa-Israel and its subsidiary Danya Cebus. In June 2012 the Fund also blacklisted Shikun UVinui, which is another major Israeli construction company involved in settlement development.

In turn, Shikun UVinui is associated with Shari Arison, reputedly the wealthiest woman in the Middle East. She is also the owner of Bank Hapoalim which is Israel's largest bank. Money laundering allegations against Bank Hapoalim include its involvements with Arcadi Gaydamak, which was settled-out-of-court earlier this year.

Gaydamak, you will recall, was the central role player in the Angolagate scandal. He is one of numerous gangsters who flocked to Israel from the Soviet Union during the 1970s, albeit he soon re-emigrated to France to make his fortune. The Angolagate arms deal was estimated to have been worth US$791 million. Gaydamak and his cronies in the French government during 1993 until 1998 sold huge quantities of Soviet armaments to the Angolan government for use against Unita.

The French wanted access to Angolan oil irrespective of the devastation and human miseries resulting from yet more weapons in a country already awash with arms. Jean Christophe Mitterrand, son of the former French president, was amongst those involved. Gaydamak managed to escape back to Russia to avoid a six year jail sentence for gunrunning.[xix]

Extraordinarily, the Paris Court of Appeals in April 2011 overturned the judgment. It ruled that irrespective of the UN arms embargo, it was not illegal to import weapons into Angola, and therefore dismissed the charge of arms trafficking. Israeli newspapers in July 2011 reported that Gaydamak is back in business in Angola.

Gaydamak and Leviev were business partners in laundering Angolan blood diamonds for weapons, but in due course fell out. Gaydamak this year sued Leviev in a London court for US$1 billion, but the case was dismissed.[xx]

Bank Hapoalim's former chairman, Danny Dankner was dismissed in 2009 by Arison after intervention by the governor of the Bank of Israel, Stanley Fischer, and allegations of money laundering and corruption by Dankner.[xxi] The confrontation between Fischer and Dankner had an extraordinary sequel on October 23, 2012 when a petition was filed in the Israeli High Court alleging that Fischer, in acting against corruption in the Israeli banking system has jeopardised the integrity and stability of the Israeli financial system.[xxii]

War profiteering by international and Israeli corporations and banks has been extensively documented by "Who Profits?" and other Israeli and Palestinian peace coalitions.[xxiii]

The UN Security Council in November 1977 imposed an arms embargo against apartheid South Africa. It judged that abuses of human rights endangered international peace and security.[xxiv] That UN decision established human rights as an international responsibility.

Abuse by the US of its veto powers precludes a similar resolution against Israel. Israel's military strength, including nuclear weapons, would make a military confrontation suicidal. The three week bombardment of Gaza in December 2008/January 2009 killed about 1 400 people, and caused huge structural damage. The UN failed to implement the recommendations of the Goldstone Commission report appointed by the UN Council on Human Rights, which found that the Israeli army committed war crimes.

The Russell Tribunal on Palestine[xxv] was established as a consequence of Operation Cast Lead. The first Russell Tribunal back in the 1960s was established by Bertrand Russell, and considered American war crimes in Vietnam. It met in Stockholm and Copenhagen, and is credited with having influenced international and then American opinion against that war.

The Tribunal has no legal standing, but is founded on the principles of international law and, in gathering evidence, is akin to an American grand jury. The first session of the Russell Tribunal on Palestine in Barcelona in March 2010 considered the complicity of the European Union and its member states in not holding Israel accountable to the UN Charter, Geneva Conventions and other instruments of international law.

The second session in London in November 2010 considered the complicity of international corporations in war profiteering given the opinion of the International Court of Justice in 2004 that the so-called "apartheid wall" is illegal, and should be dismantled.

The third session met in Cape Town in November 2011. About 30 witnesses testified that Israeli government behaviour towards Palestinians meets the legal criteria of apartheid as a crime against humanity.

The fourth session in New York last month considered the complicity of both the UN and the US in not holding Israel accountable to numerous UN decisions and resolutions, including the right of return of Palestinian refugees. A press statement declared:

At this time of international, political and economic turbulence, it is particularly important for there to be a credible and effective form of international justice. The system presently has shown itself quite unable to bring about change.

Synchronised with this initiative is a proposal by the Boycott, Divestment and Sanctions Movement to apply SWIFT sanctions against Israeli banks. Money laundering is increasingly considered as a major international security threat. Corruption and abuses of human rights are invariably interconnected, whether in Burma, Zimbabwe or Israel-Palestine.

A report by Who Profits? in October 2010 found that all Israeli banks are crucially involved in financing construction in the Settlements, in financing the sale of property in the Settlements, as well as in providing financial services to corporations illegally operating in the Settlements.[xxvi]

Banking is the lifeblood of any economy, and the banking industry is an essential element in the illegal occupation of the Palestinian territories. Israeli banks are also crucially involved in laundering blood diamonds. Given the paralysis of the UN Security Council, it becomes imperative for international civil society to take remedial action.

There is also a heavy Israeli footprint in Africa, in the continuing war in the Democratic Republic of Congo - sometimes referred to as "Africa's First World War" because it is driven by exploitation of natural resources required by "first world" military industries. Diamonds, cobalt, coltan, gold and copper trafficking is a feature of this war, and Israeli nationals are disproportionately involved.

With computerisation, the international bank payments system has advanced dramatically since the 1980s, and our banking sanctions campaign against apartheid South Africa. Interbank transfer instructions are now conducted through the Society for Worldwide Interbank Financial Telecommunication (SWIFT), which is domiciled in Belgium. SWIFT links 8 740 financial institutions in 209 countries.

In February 2012, SWIFT yielded to US pressure to suspend transactions to and from Iranian banks. The Iranian currency has collapsed in recent weeks, confirming the efficacy of SWIFT sanctions. Ironically, SWIFT sanctions against Iranian banks has thereby established a precedent for similar action against Israeli banks, given their complicities in war profiteering and crimes against humanity.

Israel's economy is abnormally dependent upon trade, and thus access to the international banking community through SWIFT is vital. Without payment for imports or exports, the Israeli economy would rapidly collapse.

The proposal is economic warfare using weapons of non-violence. Unlike trade sanctions, banking sanctions impact on the financial and political elites who have the power to effect political change. And unlike wars, it is a strategy can be reversed as soon as its measurable political objectives have been achieved without inflicting casualties or devastating structural economic damage.

Each bank has an eight letter SWIFT code that identifies both the bank and its country of domicile. IL are the fifth and sixth letters in SWIFT codes that identify Israel. For instance:

Israel Discount Bank IDBLILIT

Bank Hapoalim POALILIT

Bank Ha Leumi LUMIILIT

Bank of Israel ISRAILIJ

Mizrahi Tefahot Bank MIZBILIT

Jerusalem Bank JERSILIT

Union Bank of Israel UNBKILIT

There is massive documentation confirming Israeli violations of international law. Thus an application should be made to a Belgium court to require SWIFT to reprogramme its computers to suspend all transactions to and from Israeli banks until:

1. Israel agrees to relinquish its nuclear weapons, and to accede to the Non-Proliferation Treaty

2. The Israeli government agrees to end its occupation of the West Bank including East Jerusalem, and that it will dismantle the "apartheid wall,"

3. The Israeli government recognizes the fundamental rights of Arab-Palestinians to full equality in Israel-Palestine,

4. The Israeli government acknowledges and immediately implements the right of return of Palestinian refugees.

Unlike those Swiss bankers or Prime Minister David Cameron, the Norwegian Fund managers cannot plead that the Fund is neutral. May I express the hope and expectations that as Norwegians, they have both a moral and a practical responsibility to use those financial assets in the cause of peace in Israel-Palestine and elsewhere?

Thank you

Terry Crawford-Browne


[i] David Krieger, "Remembering Eisenhower's Farewell Address," Nuclear Age Foundation, January 13, 2011.

[ii]  Martin Meredith, Diamonds, Gold and War, Simon and Schuster, London, 2007.

[iii] Alfred W. McCoy, "Beyond Bayonets And Battleships: Space Warfare And The Future Of US Global Power," Global Research, November 11, 2012.

[iv] Clem Sunter, "Looking Over The Edge Of A Cliff," News 24, October 10, 2012.

[v] Dean Andromidas, "BAE Money Trail Leads To Thatcher," Executive Intelligence Research, December 2008.

[vi] Andrew Feinstein, The Shadow World: Inside The Global Arms Trade, Jonathan Ball, CapeTown and Johannesburg, 2011.

[vii] William Simpson, The Prince, HarperCollins, New York, 2006.

[viii] Mahmood Mamdani, Good Muslim, Bad Muslim, Doubleday, New York, 2005.

[ix] John Glaser "Netanyahu Sought To Provoke Iran War, Drag In US In 2010," November 8, 2012

[x] Barry Lando "The Israeli/Saudi Nexus," CounterPoint, November 5, 2012.

[xi] Shiraz Maher "The Revival Of Prince Bandar Bin Sultan," The Spectator, August 2, 2012

[xii] "Cameron Defends Arms Deals In Gulf," Huffington Post, November 12, 2012

[xiii] Sasha Polakow-Suransky, The Unspoken Alliance: Israel's Secret Relationship With Apartheid South Africa, Jacana, Johannesburg, 2010.

[xiv] "Zimbabwe's Government Is Stealing Funds From Massive Diamond Mine, " Associated Press, November 12, 2012

[xv] "Leviev's Africa-Israel Continues Settlement-Building, Contradicting 2010 Pledge," Adalah-NY, June 18, 2012


[xvii] Yori Yalon, "722 000 Israelis Live Beyond The Green Line," Yisrael HaYam, January 14, 2012.

[xviii] The Government Pension Fund of Norway, Wikipedia, November 8, 2012.

[xix] Yossi Melman "French Court Sentences Gaydamak To Six Years' Jail Time For Gunrunning, Haaretz, October 25, 2009.

[xx] Simon Goodley "Russian Tycoon Sues ‘King Of Diamonds for $1bn," The Guardian, May 23, 2012 and "Leviev Wins Legal Round In Diamond Row With Gaydamak," Haaretz, July 1, 2012

[xxi] Eytan Avriel "Why Stanley Fischer Can't Take A Dive," Haaretz, May 12, 2009.

[xxii] http://www. "FATCA, Stanley Fischer In The High Court Of Justice Of The State Of Israel," November 4, 2012.

[xxiii]  Adri Nieuwhof, "Israeli Banks Entrenched In Settlement Building," October 26, 2009.

[xxiv] UN Security Council Resolution 418, November 4, 1977

[xxv] See website

[xxvi] "Financing The Israel Occupation: The Direct Involvement Of Israeli Banks In Illegal Israeli Settlement Activity And Control Over The Palestinian Banking Market." Who Profits, Tel Aviv, October 2010.

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