Taliban demand US return $3.5bn in frozen Afghan funds after court ruling

New York judge rules families of 9/11 victims cannot seize funds

Since the Taliban took over Afghanistan, women's rights have been crushed and the humanitarian crisis has worsened. AFP

Taliban authorities called on Washington on Wednesday to return $3.5 billion belonging to Afghanistan's central bank after a New York federal judge ruled the families of victims in the 9/11 attacks cannot seize the funds.

The US took control of the assets soon after the Taliban stormed back to power in Afghanistan in 2021, with President Joe Biden saying the money could be made available to the families of 9/11 victims.

A group of families — who years earlier sued the Taliban for their losses and won — has since moved to seize the funds to pay off the judgment debt.

But Judge George Daniels of the Southern District of New York said on Tuesday the federal courts lack the jurisdiction to seize the funds from Afghanistan's central bank.

“The judgment creditors are entitled to collect on their default judgments and be made whole for the worst terrorist attack in our nation's history, but they cannot do so with the funds of the central bank of Afghanistan,” Mr Daniels explained in a 30-page opinion.

“The Taliban — not the former Islamic Republic of Afghanistan or the Afghan people — must pay for the Taliban's liability in the 9/11 attacks.”

Mr Daniels also said he was “constitutionally restrained” from awarding the assets to the families because it would effectively mean recognising the Taliban as the legitimate government of Afghanistan.

No nation has recognised the Taliban government so far — including the US.

“The fundamental conclusion … is that neither the Taliban nor the judgment creditors are entitled to raid the coffers of the state of Afghanistan to pay the Taliban's debts.”

Mr Daniels's ruling, which aligns with a recommendation by another judge last year, deals a blow to the families of the victims of 9/11, as well as insurance companies that made payments because of the attacks.

A lawyer for the families said they would appeal the ruling.

“This decision deprives over 10,000 members of the 9/11 community of their right to collect compensation from the Taliban, a terrorist group which was found liable for the 9/11 attacks on America,” Lee Wolosky said in a statement to AFP.

The Taliban authorities welcomed the court ruling.

“These assets belong to Afghanistan. There should be no excuse to freeze or to not return them to the people of Afghanistan,” Bilal Karimi, deputy government spokesman, told AFP.

“They must be returned without any terms and conditions.”

More than 2,900 people died when four hijacked planes crashed into the World Trade Centre in New York, the Pentagon in Washington and a field in Pennsylvania on September 11, 2001.

The attack was carried out by Al Qaeda, whose leader, Osama bin Laden, had found refuge in Afghanistan under the first Taliban government, which had ruled the country since 1996.

Then-president George W Bush authorised the invasion of Afghanistan in response, swiftly toppling the Taliban — but they launched an insurgency that led to years of war between the US-backed government in Kabul supported by international forces and the Taliban.

With the withdrawal of US-led forces in August 2021, the Taliban retook power and reimposed their fundamental version of Islamic law.

The country was almost entirely dependent on foreign aid and has seen its economy teeter on the brink of collapse since Washington froze $7 billion in Afghan assets.

It now faces one of the world's worst humanitarian crises, international aid agencies say, with its 38 million people hungry and three million children at risk of malnutrition.

Mr Biden revealed a plan in February 2022 to split the cash, with half directed as aid to Afghanistan and half going to families of victims of the 9/11 attacks.

But it remains unclear what will happen to the latter $3.5 billion set aside for the families if appeals fail.