The Israeli community of Efrat in Judea. (Miriam Alster/Flash90)

Human Rights Watch urged shareholders in Israeli banks to divest from them over their alleged support of “human rights abuses” in Judea and Samaria. 

Israeli banks are contributing to the proliferation of Israeli communities in Judea and Samaria by providing loans and mortgages for construction there, violating their human rights obligations, Human Rights Watch (HRW) alleged in a report Wednesday.

The report said that Israeli law does not force banks to provide such services to Israelis living in Judea and Samaria, and urged them to distance themselves from such activities. It also urged the banks’ shareholders to “ensure that their business relationships do not contribute to or benefit from” human rights violations.

HRW alleges that the banks have helped the expansion of the Israeli communities in Judea and Samaria, which are now home to over 450,000 Israelis.

Sari Bashi, the group’s Israel and Palestine advocacy director, said the banks should abide by the United Nations guiding principles on business and human rights, a set of non-binding guidelines meant to address and remedy supposed abuses committed in business activity, or else face action by shareholders.

“There are many, many steps banks can and should take to at the very least reduce their involvement in settlements, if not stop it entirely,” she said. “If they choose not to take steps, institutional investors who care about their own human rights activity should take action.”

Israel liberated Judea and Samaria and unified Jerusalem in the 1967 Six Day War. Israel has since annexed those liberated parts of Jerusalem.

Israel’s banks lend money to homebuyers, settlement councils and companies carrying out construction in Judea and Samaria.

Israeli law requires banks to accept the so-called “settlers” as customers, meaning they cannot refuse to open accounts for them. But a legal analysis by HRW of Israeli banking laws concluded that banks can refuse to provide financial backing for construction in Judea and Samaria.

While an anti-discrimination law prohibits refusal of service based on place of residence, the report said banks could cite other reasons for declining to provide loans, such as the construction’s implications for Palestinians’ human rights. The law also allows companies to decline to serve certain areas so long as they provide advance notice to customers.

“It is Human Rights Watch’s assessment that banks can, under domestic law, avoid providing many services that support settlements and settlement activity, and that doing so is necessary to fulfill their human rights responsibilities,” the report said.

The relevant laws have yet to be challenged in court, meaning the report offers only one interpretation of how they may be read.

But the group presents a warning to Israel’s banking sector: Operating in Judea and Samaria risks inviting divestment from shareholders who are opposed to Israel’s presence there. Bashi cited a 2016 move by the pension fund for the United Methodist Church that blocked five Israeli banks from its investment portfolio, saying they profit from rights abuses.

The Association of Banks in Israel, an umbrella group, declined to comment on the report’s claims. Spokespeople for Israel’s major banks either declined comment or referred queries to the banking association. Israel’s central bank had no immediate comment.

Granting a Mortgage is Not a Human Rights Violation

Eugene Kontorovich, an international law expert at the Kohelet Policy Forum, a pri-Israel conservative think tank, disputed the report’s claim.

He said that private companies are not obliged under international law to restrict where they work even if others believe the so-called “settlements” are illegal. He said companies are not necessarily violating human rights if they conduct business in an area where violations are said to occur.

“Granting a mortgage is not a human rights violation,” he said.

HRW has previously issued a report claiming businesses operating in Judea and Samaria contribute to Israel’s violation of human rights and has called on them to cease their activities there.

HRW is infamous for its biased anti-Israel activism, while its activists have called Israel an apartheid state and promoted anti-Israel boycotts.

Human Rights Watch has published a series of reports that were highly critical of Israel, especially after wars or periods of heightened violence with Palestinian militants. For instance, it accused Israel of committing war crimes during a counter-terrorism campaign against Hamas terrorists in the Gaza Strip in the summer of 2014. Israel harshly rejected the findings of that report.

Foreign Affairs spokesman Emmanuel Nahshon has previously called HRW a “blatantly hostile anti-Israeli organization whose reports have the sole purpose of harming Israel with no consideration whatsoever for the truth or reality.”

By: AP and United with Israel Staff