WASHINGTON — The alleged victims of Hizbullah have filed a $650 million suit against a U.S. bank that facilitated financing to the Iranian-sponsored organization.

In what is being called the first case of its kind, 85 Americans, Canadians and Israelis have joined to file a civil action in New York City against American Express Bank and Lebanese-Canadian Bank for aiding Hizbullah. The banks, sued in New York Supreme Court in Manhattan, were accused of transferring millions of dollars that helped Hizbullah in its war with Israel in 2006.

The suit, Licci v. American Express Bank, asserted that American Express Bank, with headquarters in New York, has served as one of LCB's correspondent banks in the United States, Middle East Newsline reported. Under the arrangement, Amex has been processing dollar transactions for LCB, with headquarters in Beirut and a branch in Canada.

The plaintiffs have demanded $650 million in compensatory damages and an unspecified sum in punitive damages. The suit cited a determination by the New York State Banking Department in 2007 that Amex failed to establish procedures to prevent financing to terrorist groups.

"This is the first lawsuit brought by terror victims against an U.S. financial institution that serves as a correspondent for a bank in Lebanon," a statement by the plaintiffs said on Monday.

The statement said the 85 plantiffs were either injured or related to those killed and injured in the Hizbullah war in 2006. Hizbullah fired 4,500 rockets and missiles into Israel during the 34-day war.

The suit asserted that Hizbullah employed the funds transferred by Amex Bank and LCB to conduct the rocket attacks on Israeli communities. The plaintiffs have been represented by Israeli attorney Nitsana Darshan-Leitner and her U.S. counterpart, Robert Tolchin, who said additional suits would be filed against Lebanese banks and their U.S. correspondents.

"Hizbullah is a financial giant which is deeply entrenched in the Lebanese banking system," Ms. Darshan-Leitner said. "Any U.S. bank that serves as correspondent for a Lebanese bank may well be aiding and abetting Hizbullah terrorism, and runs the risk of serious civil liability. U.S. correspondents for Lebanese banks owe it to themselves and to their shareholders to carefully examine and re-evaluate their relationships with banks in Lebanon."

---