Biden Moves to Split $7 Billion in Frozen Afghan Funds

President Biden is beginning to open a legal path for the relatives of the victims of September 11, 2001, to sue for $3.5 billion that the central bank of Afghanistan sent in New York. However, Biden also hopes to use some of the money to aid those in the Afghan Crisis. 

Initiating the process, Mr. Biden issued an executive order Friday morning requesting emergency powers to consolidate and freeze the $7 billion in assets that the central bank of Afghanistan holds in New York. The administration said it would ask the judge  to authorize the transfer of $3.5 billion into a trust fund it will create to meet the needs of the Afghan people, such as humanitarian aid.

When the Afghan government fell apart in August - with top officials including the president and  acting central bank governor  fleeing the country - it left just over $7 billion in central bank assets, deposited at the Federal Reserve Bank of New York. Since it was no longer clear who - if anyone - had the legal authority to  access this account, the Bank made the funds unavailable for withdrawal.

The Taliban, now in control of Afghanistan, immediately demanded the right to receive the money. But a group of parents of the victims of the 9/11 attacks, one of several that won an adverse judgment against the group in seemingly far-fetched lawsuits years ago, has managed to get it.

Meanwhile, the economy in Afghanistan was collapsing, leading to mass famines, which created a huge and destabilizing new wave of refugees - and sparked the need for massive spending on hospitals.