Home | Global News | FNB- Al- Aqsa saga

FNB- Al- Aqsa saga

Faizal Patel, Radio Islam News – 11-1-2013

In the aftermath of the saga regarding the closure of the Al-Aqsa
Foundation bank account by First National Bank (FNB) due to it being
listed as an organisation that aids terrorism by the US Department of
Treasury, Office of Foreign Assets Control (OFAC) and other
international sanctions lists; some community organisations have been
calling on Muslims who bank with FNB to close their accounts and
boycott the bank.

The Media Review Network (MRN) has termed this decision by FNB as
unethical and Islamophobic.

Radio Islam spoke to Michael Vacy-Lyle, the CEO of First National Bank
Commercial Banking to get the banks perspective and further clarify
the issue that has sparked outrage amongst South African Muslims.

Vacy-Lyle said it’s not a decision FNB took, they had no option due to
it being a requirement. “From a global banking perspective, it’s a
requirement that customers who are on (multiple lists) not only on the
OFAC list…Action needs to be taken by the financial institution. So
this was not a decision FNB took, it’s a requirement,” said Vacy-Lyle.

Asked by Moulana Ravat how FNB‘s decision could be a requirement and
what bearing does OFAC have on banking in South Africa? Vacy-Lyle said
that banking is a global practice and banks facilitate the movement of
funds around the world. “There needs to be certain astute practices
between banks to make sure there is global best practice. This is just
an example of one of those requirements. It’s not just FNB; it exists
across all South African banks. So, most South African banks will have
the same requirements upon them. It’s just global banking practice,”
said Vacy-Lyle.

So if Al-Aqsa closed its account with FNB and try to open an account
with any other bank, would those banks follow the same procedure as
FNB? Vacy-Lyle said he can’t comment on the other banks, but they
would go around a similar process towards what FNB went to.

Despite the Al Aqsa Foundation of South Africa being a bona-fide
organisation and granted an annual clean bill of health by the
Department of Social Services, and the South African government, OFAC
has still listed Al-Aqsa. Asked to comment, Vacy-Lyle said, “The two
are separate. The two are very distinct. For one, FNB is not
expressing opinion at all on the bona-fida of the Al-Aqsa Foundation.
We have (no certainty) what the foundation does. The unfortunate thing
is that the foundation specifically found itself listed, which
specifically makes it a problem from a banking perspective.”

“The important thing for the foundation and we have been in engagement
with the foundation for some time. This is not done overnight. We
didn’t wake up one day and go to the foundation and say listen you
need to move your account. A discussion has been had with the
foundation over many months. The issue is the foundation needs to
manage its position on this list. Because the fact that it’s on this
list is not good for the foundation. And we’ve had this discussion
with the foundation and we have passed the best possible advice to
them around this listing that we possibly can,” added Vacy-Lyle.

Al-Aqsa claims that the listing is a case of mistaken identity and the
name on the list is actually Al-Aqsa International which is a European
based organisation and there are many Al-Aqsa’s, which is not in
reference to the Al-Aqsa Foundation operating in Fordsburg. Vacy-Lyle
says that FNB does not take lightly (servicing) the customer. They do
take (exceptions)…This has happened in the past and they will continue
to do it as it’s a requirement. “The foundation is not unique.We have
over the years exited relationships for various reasons. So this is
not a unique situation. When we do this, however it’s in our interests
to bank as many oragnisations and entities as possible. I have a
company and other entities that have appeared on similar listings in
the past. But this is not a specific (to affect) Muslims and Islam, it
happens as a course of banking practice,” added Vacy-lyle.

“When we make a decision to exit a relationship, we make very, very
sure that we have the facts on the table. When we found out about the
listing (of Al-Aqsa) the OFAC listing, we made absolutely sure that it
was the (entity) that was listed. We actually went as far as engaging
an independent party to do the verification around the entity to make
sure that it was the correct entity that was listed”, said Vacy-Lyle.

There are claims that the Al-Aqsa Foundation has been banking with FNB
for approximately a decade. It’s further claimed that Al-Aqsa
International being on this OFAC list is not anything new. But rather
goes back to 2003 and that FNB had raised the issue will the Al-Aqsa
Foundation before and the explanation offered by the organisation was
accepted by FNB.

Asked to comment why does it became a problem now, Vacy-Lyle said the
foundation was first listed in 2003. He said they only became aware of
the listing about 12 months ago and took the necessary action and it
is not factual to say they knew about it prior to that . According to
Vacy-Lyle, there were other non-Muslim organisations that were also
listed and similar action was taken against those entities. However he
said that none of the other orgnisations and business that were listed
were Muslim organisations besides the Al-Aqsa Foundation.

Vacy-Lyle also emphasizes that compliance processes are improving all
the time in South Africa and global banking. “I don’t know if you are
aware, it’s quite topical, but ING bank which is a global bank,
recently received a very, very significant fine for transgressions
around the OFAC listings. And it’s in the press, you can have a look,”
added Vacy-Lyle.

Vacy-Lyle dismissed any conspiracy theory that any lobbyists brought
the listing to the attention of Rand Merchant bank or FNB. “This is
just business process and we have been extremely sympathetic with the
foundation. We have never passed judgment on the foundation and we
don’t pass judgment on the foundation. I advised the foundation from
the start as always been, ‘Please get yourself off this list’, said
Vacy-Lyle.

He added, “ we’ve been sympathetic in that we’ve taken quite some time
to allow the foundation…Infact the foundations accounts have not been
closed. We’ve given them until the 31st March 2013 and discussions
have started quite some time back. We have given significant amount of
time. We have been incredibly sympathetic. FNB is a very, very South
African entity. We are massively reflective of the country that we are
proudly part of. We employ a significant amount of Muslims, we have a
significant amount of customers, and we are a Proudly South African
institution. So we have got no agenda whatsoever other than the fact
that in the banking environment there are very objective requirements
that we have to comply with.”

Vacy-Lyle said, “If you look at the websites of the major banks in
South Africa, OFAC listing is something that is reflected on those
bank websites and that they will be complying with this listing. So
this is nothing new. There is definitely no precedent whatsoever. This
is something that has existed for some time. So this is not a new
development.”

He reiterated that if organisations find themselves listed and they
find themselves wrongly listed, it is absolutely critical that they do
their best to get themselves off that list.

Asked if it was possible to get off the list, Vacy-Lyle said, “It has
happened. We should use Cat Steven (Yusuf Islam) as an example who’s
converted to Islam. He’s obviously had challenges when travelling in
the past, particularly in the States. He fought it vociferously and
he’s been able to manage that situation. So it can be done, it is
challenging, but it can be done.

Asked to comment on some organisations calling for a boycott, terming
the decision by FNB as unethical, to be Islamophobic, Vacy-Lye said,
“Our plan is just to be honest. That’s all we can be. From a FNB/First
Rand perspective we just want to be honest. We are engaging with
community leaders across the country and businessmen for assistance in
the matter. We offered our support to the foundation and will do
whatever we can to assist the foundation and will continue to do so.”

Vacy-Lyle reiterated it would be ideal that meetings with community
leaders and businessmen result in a “win-win” situation. “Its
absolutely critical that there is a “win-win situation, “said
Vacy-Lyle.

Moulana Ebrahim Bham, the secretary general of the Jamiatul Ulama said
that FNB had met with the Jamiat, it has met with the Muslim Judicial
Council, with other organisations and with the Al-Aqsa Foundation
itself. “We can take it at face value, the placing of Al-Aqsa on the
OFAC list has made it very difficult for banks to trade overseas and
has led to a curtailment of their trading opportunities or trading
activities,” said Moulana Bham.

However Moulana Bham said there are many unanswered questions and the
concern is the Muslim community will together have to deal with those
concerns. Among the concerns is an organisation has been placed on a
list. Who places them on the list and on what basis? He said “It’s a
completely arbitrary decision by the United States Treasury to place
an organisation on the list.”

Moulana Bham added that the Al Aqsa Foundation has complied with all
South African regulations from the Department of Social Services to
the Reserve bank. Yet it is placed arbitrary on a foreign country’s
list without it having any say with regards to the decision or even
contesting or appealing the decision. “What happens if we have a
Japanese list, what happens if we have a German list, what happens if
we have an Indian list? Would the bank than just all of a sudden take
all of that into account and just arbitrary close peoples accounts,
close individuals and organisations accounts?” asked Moulana Bham.

Another aspect Moulana Bham touched on was the comment made by the CEO
of FNB Commercial Banking. Michael Vacy-Lyle claims that FNB is wholly
and solely a South African entity. “When you say you are wholly and
solely South African entity, what does it say about the sovereignty of
South Africa as a nation, South Africa as a country, South African
companies? Despite your sovereignty you subject your sovereignty to
the decision of a third country and you say you are unable to act and
you are forced to act in this particular manner. These are some of the
concerns which is something that has been placed with them and we are
going to continuously be putting those concerns not only to FNB, but
to the banking fraternity and relevant authorities in government.”
said Moulana Bham.

When asked that when Muslims organisations face such situations, is it
premature to call for instantaneous condemnation, immediate boycotts
and closing of accounts, refusing to meet representatives of the bank
an condemn those who do try and meet with different role players to
reach an amicable solution as ‘collaborators’, sellouts and market
share seekers, Moulana Bham said, “At the end of the day each and
everyone has his own conscience. There are different methods of
dealing with the situation. We believe in the kalimah La Ilaha
Illallah, we are proud to be Muslims and there will be different
approaches. But to put this type of insinuations towards one another,
where does it take people?”

“To go to this particular level of accusing one another and calling
one another names, I think that is unnecessary and I don’t think it
helps the situation in any way. Infact I would say that is part of the
market share that people are talking about,” added Moulana Bham.

Moulana Bham said he firmly believes that boycott is an important tool
that can be used. It has been used in the past very effectively and
has even been used in the time of Prophet Muhammad (PBUH). “There is
no doubt to it. I don’t rule out boycott as a tool and it can be a
very effective tool. But the way we as South African Muslims today are
using boycott, I think it has rendered it to a large degree in
effective. “Said Moulana Bham.

Moulana Bham added “such an effective tool that can be used, it should
be the last resort. And such an effective tool that can be used for
the South African Muslims whenever they feel aggrieved. But it is
being rendered ineffective by emotions, getting the better of people
or perhaps not using the right method with regards to boycotts.”

Moulana Ravat added, “We should tolerate each other’s differences in
approach to concerns facing the Ummah and focus on finding common
grounds to jointly address the issue, rather than start criticizing
each other, as that distracts and weakens us .”

Radio Islam has learnt that following FNB’s decision to terminate the
Al-Aqsa Foundations account from March 2013, Al Aqsa opened a bank
account with Al Baraka. After the account was opened, the bank also
decided to close the account, and has temporarily re-opened the
account after discussions.

Radio Islam also forwarded a copy of FNB’s statement to the banking
ombudsman for comments and the following statement was issued by the
body:

“Our mandate is to adjudicate disputes between bank customers and
their banks. We do this in an independent, impartial, confidential and
speedy manner. Our service is free. Unfortunately we are therefore
precluded from commenting on a particular set of circumstances unless
and until a formal complaint has been lodged with our offices. What we
can do is refer you to the Code of Banking Practice which is a
voluntary code that sets out the minimum standards for service and
conduct to which all banks subscribe.”

“In terms of paragraph 7.3 of the Code: dealing with the “closing an
account” the following is enumerated:

A bank will assist you to close an account that you no longer require.
A bank will not close your account without giving you reasonable prior
notice at the last contact details that you gave your bank.
Your bank reserves the right, however to protect its interests in its
discretion, which might include closing your account without giving
you notice.
If the bank is compelled to do so by law (or by international practice);
If you have not used your account for a significant period of time; or
If your bank has reasons to believe that your account is being used
for any illegal purposes
It seems, therefore, that your bank is purporting to have acted to
close the account in terms of the provisions of paragraph of 7.3

To listen to the full interviews with Michael Vacy-Lyle, the CEO of
First National Bank Commercial Banking and Ml Ebrahim Bham,click the
links below:

http://www.radioislam.org.za/a/index.php?option=com_content&task=view&id=28542&Itemid=125

http://www.radioislam.org.za/a/index.php?option=com_content&task=view&id=28541&Itemid=125

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