U.S. Treasury violated rights of Al-Haramain Islamic Foundation, judge says
PORTLAND — A federal judge in Oregon has ruled the government violated the constitutional rights of an Islamic charity by designating it as a terrorist organization without giving it adequate notice.
U.S. District Judge Garr King said the Treasury Department violated the Fourth Amendment rights of the Oregon chapter of a defunct Islamic charity based in Saudi Arabia.
Treasury officials froze the assets of the Al-Haramain Islamic Foundation in Ashland after listing it as a "specially designated global terrorist organization" in September 2004. The former local branch of the organization was operated by Pirouz Sedaghaty, aka Pete Seda, who is currently residing in the Portland area and fighting government charges of tax fraud and conspiracy in connection with the charity.
King said the Treasury's Office of Foreign Assets Control needed only a "reasonable belief" that the charity was "a component of a larger organization that funds terrorism."
But the judge said the agency violated the charity's due process rights by failing to giving it notice and a chance to make an argument against the designation.
"We think that invalidates the whole designation," said Lynne Bernabei, an attorney for the charity in Washington, D.C.
King also ruled the law on the provision of "material support" to any group given the designation was unconstitutionally vague.
A Justice Department spokesman declined comment but said the ruling was under review.
King said in his 63-page opinion issued Thursday that the Fourth Amendment due process violation "may be harmless."
But he criticized the Bush administration for issuing a press release in 2004 announcing the designation and linking the Oregon chapter of Al-Haramain to Osama bin Laden, "which is not a statement supported by the unclassified record."
King noted that the authority to make the designation came from an executive order Bush signed after declaring a national emergency following the September 11, 2001, terrorist attack.
"In his executive order, the President also delegated authority to the Secretary of Treasury to designate other foreign groups or individuals who have committed or pose a risk of committing acts of terrorism," King wrote.
The case also involves the issue of whether the terrorist designation can be made by relying on classified documents.
King said the Treasury Department did have the authority to keep the classified record secret under the International Emergency Economic Powers Act.
"I conclude, however, that the government violated Al-Haramain Islamic Foundation-Oregon's due process right to adequate notice prior to designating it," King wrote.
The ACLU of Oregon, which was not a party to the suit, praised King's decision.
"In the United States, our government should not be allowed to unilaterally seize an organization's assets without providing evidence to support its action or a meaningful opportunity to respond," said Executive Director David Fidanque.
The Treasury Department list of specially designated organizations or individuals has grown to more than 400 pages after Bush identified two dozen to Congress when he declared a national emergency in 2001.
In a separate challenge to the terrorist designation, the charity and government lawyers have battled over a National Security Agency document that was accidentally given to Al-Haramain lawyers.
The document has been under tight security ever since the lawyers reported it to the Justice Department and all copies were returned at the government's insistence.
The 9th U.S. Circuit Court of Appeals returned that case to a trial judge for another hearing after rejecting part of the challenge.
Seda, 50, has been free under federal restrictions since November 2007, 21/2; months after he returned from the Middle East as a federal fugitive to fight charges related to his activities with his Al-Haramain Islamic Foundation chapter he ran out of his Ashland home.
He was indicted in 2005 on money-laundering and tax fraud charges stemming from the alleged smuggling in 2000 of $150,000 from Oregon to Saudi Arabia to help Muslim refugees in Chechnya who later were labeled as terrorists.
The chapter and its other officer, a Saudi Arabian national named Soliman Al-Buthi, who is a co-defendant in the case, have both been labeled as supporters of terrorism by the U.S. government. Seda has sidestepped that designation.
The Associated Press contributed to this report