PRESS RELEASE Office of Missouri State Treasurer Sarah Steelman FOR IMMEDIATE RELEASE  --  October 03, 2005

            JEFFERSON CITY – The Missouri State Employee Retirement System (MOSERS) has decided to sell more than $80,000 in stock it holds in Arab Bank. The Arab Bank holdings by MOSERS has come under sharp fire from Treasurer Sarah Steelman, who serves as a member of the MOSERS board, because of legal actions and allegations that Arab Bank funded more than $20 million to terrorist groups.

            “I am very pleased that MOSERS has finally gotten rid of this stock,” Steelman said. “The evidence is clear and convincing the Arab Bank has engaged in the sponsorship of terrorism and it is high time we dumped their stock.”

The decision by MOSERS staff to sell the Arab Bank stock comes less than two weeks before a scheduled vote by the MOSERS Board on whether to force the stock to be sold. At that meeting, the Board is also expected to vote on a private vendor to help screen stocks to ensure they are not tied to companies or countries involved in terrorist activities. A previous effort by Steelman to force the sale of the stock died in a tie vote.

“Our tax dollars should never be invested in companies or in countries that support terrorism,” Steelman said. “Selling the Arab Bank stock is the first step. Insuring a policy that prevents such investments in the future is the next step.”

In January, the U.S. Treasury Department ordered Arab Bank’s New York branch to stop making international wire transfers. In March, the Treasury prohibited the bank from accepting deposits or opening accounts. Last month, Arab Bank was subject to a $24 million fine by the Treasury Department for failing to enforce banking laws to ensure transfers from the U.S. were not made to foreign terrorist groups.

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            Arab Bank is also is the subject of more than $1 billion in civil suits brought by the family members of suicide victims. The first suit was brought by the family of John Linde Jr., a 10-year Marine veteran from Washington, Mo., who was killed by a terrorist bomb while guarding diplomats in Gaza.

            The suits allege that Arab Bank had established special accounts to pay money to the families of  “martyrs” who had carried out suicide bombings. Ads in Arab-language newspapers directed family members to bring documents to local branches of Arab Bank to receive the “martyr” funds.

            “This is a stock that should never have been bought with Missouri public dollars, and I am very pleased that this company will no longer be in our portfolio,”  Further, I believe the debate over this stock will result in stronger policies that will ensure this type of investment is not made again.”

Contact: Mark Hughes, director of policy and communications (573) 751-7595

mark.hughes@treasurer.mo.gov.

An electronic version of this release is available at: http://www.treasurer.mo.gov/newsandevents.asp