Norwegian People’s Aid, (NPA) signed an agreement with the United States Government on March 28, 2018 settling a federal lawsuit alleging that two of its projects – democracy training for youth in Gaza and mine clearing in Iran – violated the terms of a 2012 USAID grant agreement to provide emergency aid in South Sudan. NPA’s grant agreement with USAID stipulated that it did not provide material support to entities on U.S. terrorist lists. NPA said it believed the certification only applied to U.S.-funded activities, but USAID said it applies to all NPA projects, regardless of funding source. The case was filed in 2015 under seal in federal district court in the Southern District of New York under the False Claims Act by attorney David Abrams, a self-described “pro-Israel activist.” NPA said it agreed to pay $2.025 million in order to close the case and avoid the expense of a trial. Because the case settled prior to trial there was no challenge as to whether the either of projects constituted material support. Abrams told Development Today he has two more cases against European NGOs pending under seal.
USAID’s Grant Clause
Under the terms of its grant agreement with USAID, NPA submitted certifications between 2012 and 2106 that said “to the best of its knowledge, it did not provide, within the previous ten years, and will take all reasonable steps to ensure that it does not and will not knowingly provide, material support or resources” to any person or group on the U.S. terrorist list (Specially Designated Nationals, or SDN). It also certified that it would verify that any individuals or entities it assisted do not appear on the SDN list. (See page 6 of the settlement agreement.)
NPA’s Programs in Gaza and Iran and Material Support
In Gaza NPA partnered with the Institute for Development Studies from 2012-16 in the “Youth of Today, Leaders of Tomorrow” program, funded by the Norwegian Agency for Development Cooperation (NORAD). Youth ages 15-28 were trained in democracy skills such as organizing, advocacy and conflict resolution, as well as human rights and responsible business conduct. NPA’s description of the program said it was advertised to the general public “with registration open to all.” It goes on to say NPA “partners do not require course participants or those taking part in similar activities to reveal whom they vote for.” The settlement agreement also noted that other workshops funded by the program included both youth in Gaza and senior officials of prominent political parties, which included “representatives of entities that were identified on the SDN list as prohibited parties.” (p 7-8) These were Hamas, the Popular Front for the Liberation of Palestine and the Democratic Front for the Liberation of Palestine. A press release from the U.S. Attorney’s office said the workshops enabled the listed groups to “alter their behavior in order to become more attractive to youth and, thereby, benefit from increased youth support.”
The definition of prohibited “material support” of terrorism in the Antiterrorism and Effective Death Penalty Act includes provision of training and services to listed groups or persons. There is no requirement that the support be intended to support terrorism and the humanitarian exemption is limited to religious materials and medicine. In 2010 the U.S. Supreme Court upheld the constitutionality of the prohibition when applied to speech and communications aimed at resolving conflict or teaching about human rights (Holder v. Humanitarian Law Project). However, government statements in court proceedings raise questions about whether some aspects of NPA’s Gaza program might be permissible:
Solicitor General’s Brief p. 3 Peacebuilding organizations may provide FTOs with information that is based on general knowledge, including information on international humanitarian law (i.e. requirements on humanitarian access, treatment of children and protection of medical facilities) and historical examples of successful transitions by armed groups to nonviolent political processes.
Solicitor General’s Brief p.22 If conflict resolution and peacebuilding training is provided in a forum open to the public and is not provided in coordination with or at the direction of an FTO, such training does not violate the statute simply because one or more members of a FTO attends.
Solicitor General’s Brief p. 31 Peacebuilding organizations may provide FTOs with information that is based on general knowledge, including information on international humanitarian law (i.e. requirements on humanitarian access, treatment of children and protection of medical facilities) and historical examples of successful transitions by armed groups to nonviolent political processes.
NPA’s description of its landmine program in Iran noted that it conducts landmine clearing in more than 20 countries, “often in cooperation with the U.S. Department of State …” The program in Iran was undertaken with a contract with Norsk Hydro, an energy company, to clear mines as part of an oil development project. NPA planned to use the proceeds for humanitarian programs, but because it interacted with Iranian government officials and Iran is on the U.S. state sponsors of terrorism list, the U.S. considered the program to be material support.
The False Claims Act: Lawsuit Under Seal
Abrams’ complaint against NPA was filed under the False Claims Act, which allows private citizens to file enforcement suits on behalf of the U.S. government in cases of fraud and false claims. In this case, the grant certifications were alleged to be the false claims. The law allows the private citizen to collect part of any damages paid to the government. In this case, Abrams collected $346,500.
Although the suit was filed in 2015, NPA did not know about it until September 2017 when USAID’s Office of Inspector General (OIG) told it an investigation was underway. Earlier, in February 2017, NPA had responded to a request from the OIG about its projects in the Middle East. When told about the investigation NPA hired a U.S. lawyer, David Schertler of Schertler & Onorato in Washington, DC and sought a settlement. NPA said its costs in defending the action were over $250,000.
In addition to paying the damages, NPA agreed to revise its internal policies to comply with U.S. law, provide training on compliance with U.S. grant terms to its managers and administrative staff and submit to stringent external audits and periodic reviews on its compliance. Meanwhile, Development Today reports that NPA continues to operate 13 programs under $54 million in grants from the State Department, which does not have the same grant restriction. To date NPA says it has no indication that these grants will be affected by the settlement with USAID.
That does not preclude further U.S. legal action against NPA or the individuals associated with the programs in Gaza and Iran. The settlement agreement explicitly exclude any future action by the IRS, criminal prosecution, conduct not covered by the agreement, suspension and debarment from eligibility to receive government grants and contracts or liability of individuals. (p. 9) NPA also agreed to cooperate with any U.S. investigation of those not covered by the agreement, “consistent with NPA’s obligations under Norwegian law.” It agreed to encourage cooperation of its officers, directors and employees in such investigations and furnish non-privileged documents that may be requested. (p.5-6)
The status of the two additional cases Abrams filed under seal remain unknown.