Legal action launched against Central Bank over Israel bonds investments

By Cate McCurry and Cillian Sherlock, PA

An politician has launched legal proceedings against the Central Bank of Ireland over claims that investors in Israeli bonds could be legally complicit in genocide in Gaza.

Lawyers for Social Democrats TD Gary Gannon lodged legal papers against the Central Bank in Dublin on Thursday.

It is alleged that the Central Bank’s failure to ban the marketing, distribution and sale of Israeli bonds exposes investors to risks that have not been disclosed to them.

 

Letters, seen by the PA news agency, sent to Gabriel Makhlouf, the governor of the Central Bank, in recent weeks by McGarr Solicitors, acting on behalf of Mr Gannon, claim that these risks were not made known to investors in prospectuses for bonds, which had been approved by the Central Bank.

The letter warns Mr Makhlouf that the “continued issuing and trading of those bonds gives rise to significant investor protection concerns, in light of the complicity of Israel in genocide in Gaza, and the use of the proceeds of the Israeli bonds to facilitate the same”.

It goes on to say that the Central Bank is empowered under EU law to prohibit the marketing, distribution or sale of the Israeli Bonds.

“We call upon it to do so,” the letter adds.

There have been ongoing calls for the Central Bank to end its role in approving Israel Bonds for sale in the EU.

The bank is the designated authority in relation to the sale of Israel bonds in the EU, and has determined the securities meet the standards of the bloc’s prospectus regulations.

Israel bonds have been advertised as supporting the country’s economy and, more recently, websites promoting the securities emphasise their role in supporting Israel’s military operations in Gaza.

Protesters and opposition parties have called for legislation that would give Ireland the power to refuse the sale of Israeli “war bonds” over human rights concerns.

They say the bonds are intended to fund the war in Gaza, while Ireland has an obligation under the Genocide Convention to use all means likely to have a deterrent effect on those suspected of preparing genocide.

 

Mr Gannon issued the letters to the bank about investor protection concerns relating to the bonds, as well as the use of the bonds to finance the war in Gaza at the end of last month.

In response, the Central Bank, through its solicitors, said that there is “no valid legal basis” to support Mr Gannon’s purported judicial review proceedings.

They claimed that Mr Gannon lacked locus standi to bring the proceedings and that the bank is satisfied it does not meet the relevant criteria to exercise its powers under EU law.

The letter also claims that judicial review proceedings would lead to court time being “expended unnecessarily and substantial costs being incurred”.

However, Mr Gannon said the Central Bank has the power to stop the sale of the bonds.

The judicial review was formally issued on Thursday afternoon.

Speaking at a pro-Palestinian rally on Saturday, Mr Gannon said: “Politicians have spoken too long, all the while a genocide is being inflicted upon the population of Gaza. The demands today are clear – act.

He added: “On Tuesday, I’ll be lodging papers against the Central Bank. Genocide can never be considered a technical matter – our only duty is to prevent it and punish those responsible.”