Terror Victims Seek Frozen Assets

Held as a human shield to prevent enemy strikes on an Iraqi uranium enrichment complex, Avo Boyamian would wake at night, soaked in sweat.

Now the Boston-area businessman, captured on a 1990 trip to Kuwait, could get compensated for his mental anguish. If a provision to a terrorism insurance bill passes into law, victims of terrorism could be paid off from over $3 billion in foreign assets frozen in the interests of national security and foreign policy.

Boyamian, 58, sued Iraq under the Foreign Sovereign Immunities Act, which was amended in 1996 to allow Americans injured in terrorist acts to sue the seven foreign countries the State Department classifies as supporting terrorism.

The State Department opposes the provision by Sen. Tom Harkin, D-Iowa, on the grounds that frozen assets have proven useful in diplomatic negotiations and shouldn't be liquidated for individual claims.

"It would undermine our fight against terrorism,'' said Brenda Greenberg, a department spokeswoman. The hope of getting assets back is an incentive for states to stop supporting terrorism, she said.

Boyamian's judgment is one of at least 190 outstanding across the country — the vast majority against Iraq for injuries sustained by Americans caught in the Aug. 2, 1990, invasion of Kuwait that precipitated the Persian Gulf War. A handful are against Iran for various acts of terrorism, including a 1996 bus bombing in Israel. The average award sought is $500,000; some victims are seeking millions of dollars.

"It was very frightening,'' said Paul Pawlowski, 60, of Providence, R.I., an architect forced into hiding in Kuwait City with his wife and young daughter. His family was released after nearly six weeks, but Pawlowski was holed up with colleagues for months.

Congress will consider Harkin's provision after it returns Nov. 12. If it becomes law, about $210 million is expected to be paid out for current judgments. It's unclear if judicial or administrative appeals could be employed to stop the payments.

Over time, more victims could benefit if they get judgments against designated terrorist states — besides Iraq and Iran they are Cuba, Libya, North Korea, Sudan and Syria — or organizations. Among the pending lawsuits is one against Libya for the 1988 bombing of Pan Am Flight 103 over Lockerbie, Scotland, which killed 270 people.

Blocked assets are among the economic sanctions employed by the U.S. government against targeted countries, terrorists, international drug traffickers and those engaged in activities related to the proliferation of weapons of mass destruction.

While the title to bank accounts, securities and other property in the United States is retained by the targeted country or individual, there is an across-the-board ban, imposed by the Treasury Department, on any transfers or dealings with the property.

The State Department maintains that frozen assets were fundamental to resolving the 1979 Iranian hostage crisis, because Iran wanted assets released in exchange for hostages. During normalization talks with Vietnam, blocked assets were used as a bargaining chip to gain information about U.S. soldiers held prisoner or missing from the Vietnam War.

Blocked assets can be given back to a country, as happened in Afghanistan after the Taliban were driven out of power.

The Bush administration favors paying victims with U.S. funds, but there is precedent for distributing frozen assets.

A 2000 law gave access to frozen Cuban assets — over the State Department's objections — to families of workers for Brothers to the Rescue, an exile fliers group whose plane was shot down off the coast of Florida by Cuban jets in 1996. Some Iranian terrorism victims, including former hostage and Associated Press correspondent Terry Anderson, were paid from the U.S. Treasury, with the money to be recouped from Iran.

Victims say the U.S. strategy of trying to stop terrorism by hoarding assets has been a failure, and it makes even more sense to compensate them with foreign assets in wake of the U.S.-funded compensation offered to the Sept. 11 families.

"We are willing to take taxpayer dollars to compensate people,'' said Frank Amos, 47, of Gilmer, Texas, whose father Charles was captured by Iraqis as an oil-drilling worker in Kuwait and held at a power plant where emissions were so strong they ate holes in his clothes. "But yet, we're not willing to release funds from people who have actually done that kind of damage.''