Palestinian banks caught funding Hamas during Gaza war

Israel’s finance minister threatens to end tax transfers to PA over “pay-to-slay” stipends to terrorists amid report Palestinian banks are channeling money to Hamas in Gaza.

By World Israel News Staff

Palestinian banks are being used to channel money to the Hamas terror organization in the Gaza Strip, according to a report published Monday night, as Israel’s finance minister signals a new standoff with the Palestinian Authority.

Israel has obtained intelligence information showing that the Palestinian banking system has continued to transfer funds to Hamas in Gaza. It was also used during the two-year war with Israel to funnel money to the terror group’s war effort, Channel 14 reported.

The transfers to Gaza were made primarily through the Bank of Palestine, with a significant portion of the transfers going to Hamas.

The report comes following revelations that the Palestinian Authority has violated its own reforms, instituted to end the “pay-to-slay” policy of offering stipends specifically to jailed terrorists and the relatives of slain terrorists.

Despite the PA declaring an end to the “pay-to-slay” program, payments have continued to be made by Ramallah to jailed terrorists and terrorist families.

As a result of both the PA’s continued funding for terrorists via the “pay-to-slay” program and the involvement by the Palestinian banking system in channeling money to Hamas, Israeli Finance Minister Bezalel Smotrich is threatening to halt tax transfers to the Palestinian Authority.

The funds, collected by Israel on behalf of Ramallah from Palestinian Authority residents employed inside Israel, are transferred monthly to the PA.

In addition, Smotrich is threatening to effectively sever Israel’s banking ties to the Palestinian Authority.

Two Israeli banks, Hapoalim and Discount Bank, have for years been used as intermediaries to carry out money transfers between the Israeli banking system and the Palestinian Authority.

The two banks are shielded from legal liability related to terror activities conducted in the Palestinian Authority by a Finance Ministry directive.

Smotrich is said to be threatening to withhold the next extension of the waiver if the Palestinian Authority does not halt the payments to terrorists and bar money transfers to Hamas.

“This is an absurdity that will not continue,” Smotrich was quoted as telling ministry officials recently. “Funding a terror-supporting entity in order to maintain quiet is the pre-Oct. 7 policy that must be uprooted at the root.”