On Feb. 27, 2009 the Palestinians Relief and Development Fund (Interpal) was cleared of supporting terrorism in the third inquiry into its activities by the United Kingdom’s (UK) Charity Commission.  The charity also overcame hurdles to financing its operations created by two prominent banks that withdrew their financial services in response to the United States (U.S) listing of Interpal as a supporter of terrorism.

The Charity Commission inquiry into the Interpal’s activities concluded the charity is not funding or supporting groups sponsoring terrorism. The Commission ordered improvements in procedures for choosing and overseeing local charity partners in the Occupied Palestinian Territories, Jordan and Lebanon.  It also recognized the importance of charities that conduct aid related activities in “high-risk” areas of the world and acknowledged the dangers they face.  As a result of the inquiry, Interpal made changes to their Trustees and partner organizations in the Middle East. The entire analysis of the Inquiry can be found here.

The inquiries into Interpal were triggered by allegations stemming from the U.S. Department of Treasury’s designation of it as a Specially Designated Global Terrorist organization in August of 2003. In all three investigations, the Commission had asked the U.S. for a legal or evidential basis for the designation but the U.S. government has declined to do so each time.

The U.S. designation caused Lloyds TSB and the Co-operative Financial Servicestwo of London’s most prominent banks, to withdraw and refuse banking services to Interpal.  Both financial institutions told Interpal that the U.S. designation was the motivating factor behind their decisions.  The account closure generated a series of petitions and protests in the UK. On Jan. 17, 2009 over sixty nonviolent protesters gathered in front of a Lloyd’s branch office in Bristol, England. A Bristol area activist, Jeremy Clarke, applauded the protestors’ efforts and said,“Interpal is amongst only a handful of charities able and daring to work in such a politically sensitive area.”

Eventually, the Islamic Bank of Britain helped secure an alternative banking service and the charity’s operations have been able to continue. Interpal’s website reports, “We would like to reassure our donors that our aid is being delivered to our areas of operation thanks to our local partners.”