Lawsuit alleges that UNRWA served as Hamas money laundering operation

A new suit filed by more than 100 Israeli plaintiffs — relatives of victims of the Oct. 7 attack and a released hostage who was held in the home of an UNRWA employee — alleges that the U.N. agency played a key role in enabling attack on Israel


The UNRWA logo is seen on the vest of an employee during a visit to the Jabal El Hussein refugee camp of UNRWA, , part of a diplomatic mission to Israel and the Palestinian territories, in Amman, Jordan, Wednesday 15 May 2024.

A new lawsuit filed in U.S. federal court on Monday by survivors of the Oct. 7 terror attacks and family members of Israelis killed in the attacks alleges that the United Nations Relief and Works Agency played a central role in enabling the attacks by serving as a de facto money laundering operation for Hamas in the Gaza Strip.

The civil suit, filed by MM-Law, a firm specializing in representing victims of terrorist attacks, crimes against humanity and other atrocities, alleges that UNRWA helped funnel millions of dollars each month to Hamas. The suit targets both UNRWA as an organization and several current and former UNRWA officials.

Plaintiffs to the suit include individuals whose family members were killed in the Oct. 7 attack, as well as at least one freed hostage who was held in Gaza in the home of an UNRWA teacher. 

The lawsuit hones in on UNRWA’s insistence on paying employee salaries and other expenses in Gaza in U.S. dollars, rather than in local currency, as it does in other areas, including the West Bank. It alleges that this system required recipients to pay currency exchanges — which are largely controlled by or affiliated with Hamas — significant fees to exchange dollars for shekels they could use in Gaza.

The suit claims that this system funneled millions per month to Hamas and gave the terror group a reliable supply of U.S. currency to pay weapons smugglers who would not deal in Israeli currency.

“UNRWA strengthened Hamas and transferred funds and financed the murders, acting as a full partner in the growth of Hamas terrorists. UNRWA and its directors are fully complicit in the murder of my children and family,” Gadi and Reuma Kadem, whose children and grandchildren were killed on Oct. 7, said in a statement.

UNRWA did not respond to a request for comment.

Gavriel Maron, the lead attorney on the case, told Jewish Insider that his firm began researching Hamas and its financing following Oct. 7, a money trail that took it to UNRWA and its operations in Gaza.

“The bottom line of all that was that UNRWA was forcing all of its employees and all of its suppliers to actually pay a kickback to Hamas,” Maron said.

The lawsuit also alleges significant waste in UNRWA’s operations, highlighting its operating costs and staff size which the suit claims are well out of proportion compared to other U.N. aid efforts.

UNRWA and its officials “collectively spent over a decade prior to the October 7 Attack helping Hamas build up the terror infrastructure and personnel that were necessary to carry out the October 7 Attack,” the suit alleges. “As discussed throughout, Defendants were warned repeatedly that their policies were directly providing assistance to Hamas. In the face of those warnings, Defendants continued those very policies… The resulting atrocities were foreseeable.”

The lawsuit also highlights what have become well-known examples of UNRWA’s ties to Hamas: construction of Hamas facilities inside and under UNRWA facilities, use of UNRWA facilities as Hamas sites, UNRWA employees’ membership in Hamas and participation in the Oct. 7 attacks, UNRWA staff holding hostages taken on Oct. 7, UNRWA’s failure to vet employees or indifference to terrorist ties, senior Hamas officials holding senior UNRWA roles, UNRWA’s use of Hamas-approved education materials and the teaching of anti-Israel and antisemitic material in its schools.

Maron alleged that UNRWA’s insistence on making payments in cash, trucked into Gaza, is reflective of its ill intent, noting that both Israeli and U.N. officials had highlighted the significant risks of such cash transfers. He added that UNRWA’s repeated failures to meaningfully address connections with terrorism — its “willful blindness”— constitute legal complicity in Hamas’ activities.

“Our opinion is, without what UNRWA did, we don’t think Hamas could have come anywhere near perpetrating what they did,” Maron said.

Maron said that his firm would not have brought the case unless it believed it had sufficient evidence to win. 

“The terrorist who held me hostage for 53 days worked as a school teacher for UNRWA,” said Ditza Hieman, a former hostage, in a statement. “The fact that Hamas controlled Gaza was not an excuse for UNRWA to hire and fund terrorists, but instead should have ensured UNRWA took extra precautions. UNRWA knew it was hiring terrorists and that its funds and facilities were being used for violence, but UNRWA’s complicity in paying and empowering terrorists to teach and radicalize a generation of Gaza’s children was perhaps even more evil and tragic.”

Though the plaintiffs are not U.S. citizens, the lawsuit argues that the federal court in New York has jurisdiction because many of UNRWA’s activities took place in the state and as a consequence of several other U.S. laws. The plaintiffs seek monetary compensation from UNRWA and its leadership, not any specific changes to UNRWA or U.S. policy.

“We have no political agendas,” Maron said. “The clients came to us and said, ‘Somebody harmed me, and we want to be compensated for that harm and we want to have justice.”

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