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Insurance companies which paid out to victims of the Sept. 11 terrorist attacks cannot take $6.2 million in al-Qaida funds held with a Chicago investment firm, a federal appeals court has ruled. | File Photo

9/11 insurers can’t snag al-Qaida funds held in Chicago, court rules

SHARE 9/11 insurers can’t snag al-Qaida funds held in Chicago, court rules
SHARE 9/11 insurers can’t snag al-Qaida funds held in Chicago, court rules

Insurance companies that paid out to victims of the Sept. 11, 2001, attacks on the U.S. cannot take $6.2 million in al-Qaida funds held with a Chicago investment firm, a federal appellate court has ruled.

Overturning a decision by a lower court, the 7th U.S. Circuit Court of Appeals said the government can keep the money instead.

The ruling, issued Thursday afternoon, likely ends a dispute over funds invested with R.J. O’Brien & Associatesby al-Qaida fundraiserMuhammad Abdallah Abdan Al Ghamdi, also known as Abu al Tayyeb.

Using the Terrorism Risk Insurance Act, which allows the victims of terrorism to claw back funds from those who back terrorism, insurers had been trying to get their hands on the Al Ghamdiaccount since 2011.

But the feds had blocked Al Ghamdi’s Chicago account in 2006. Citing security fears, they initially refused to turn over details about the account to the insurers.

In 2013 U.S. District Judge Matthew Kennelly sided with the insurers, ordering the government to relinquish the $6.2 million.

But the 7th Circuit ruled on technical grounds Thursday relating to when the funds were and were not blocked that the government can keep the funds. Victims, including the insurers, still can submit claims to the government for their losses, the court noted.

“It is unfortunate, to say the least, that the victims of September 11 are still seeking relief, all these years later, for their tragic losses,” the judges wrote in their ruling.

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