Aiding Friends and Foes in Palestine

How Fatah-Hamas Unity Threatens U.S. Funding

The reconciliation agreement signed in April between Fatah and Hamas, which called for the creation of an interim Palestinian unity government followed by elections later this year, raises a number of difficult issues for the United States. Among these is whether Washington can lawfully continue to provide aid to the Palestinian Authority (PA) if it includes Hamas as an equal partner. After all, existing U.S. law designates Hamas as a terrorist organization and thus prevents the United States from aiding it in any way. Although the unity pact suffered a setback when a planned conference in Cairo on Tuesday to announce a new government was postponed, negotations are ongoing. Should the two sides eventually succeed in creating a unity government, continued U.S. funding for the PA could be illegal. Despite this, given the PA’s dependence on U.S. aid, Washington may decide that financially sustaining the Palestinian leadership is vital to the peace process or other strategic interests. As a result, it may attempt to continue aiding elements of the PA that remain unaffiliated with Hamas. Yet absent specific congressional authorization, such a strategy will face significant legal obstacles.

U.S. law has long prohibited citizens from providing support to or doing business with Hamas, which has been on the Treasury Department’s designated terrorist list since 1995 and the State Department’s list of designated Foreign Terrorist Organizations since 1997. Under the U.S. criminal code, individuals cannot knowingly provide an FTO with “material support or resources,” which is broadly defined as any “property or service,” including money, training and advice, safe haven, transportation, and weapons, among other forms of assistance. Violation of this statute is punishable by up to 15 years in prison, or life in prison if the support results in the death of any person.

The Treasury Department’s Office of Foreign Assets Control (OFAC) also enforces sanctions against Hamas and its affiliates, forbidding U.S. persons from engaging in any transactions with a designated terrorist, and further requiring that U.S. financial institutions block any transactions involving assets of FTOs. OFAC frequently imposes civil fines against violators of these sanctions, who may also suffer criminal penalties.

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