The Antiterrorism Act of 1990 (ATA) explicitly authorizes a private cause of action for U.S. nationals who suffer an injury “by reason of an act of international terrorism.” ATA civil litigation has increased dramatically following September 11, 2001—and banks, because of their deep pockets, have emerged as an increasingly popular target. Courts are divided concerning the scope of liability under the statute, specifically over whether the ATA authorizes a cause of action premised on secondary liability. Under a secondary liability theory, a plaintiff could argue that a bank, through providing financial services to a terrorist client, aided and abetted an act of international terrorism.

This Note examines the conflict over secondary liability under the ATA, applies this conflict to banks specifically, and concludes that the legislative history of the ATA civil provision is not enough to support such a cause of action. This Note ultimately finds, however, that the absence of any kind of secondary liability route for plaintiffs diminishes the ATA’s power as a deterrent against terrorism financing and also has interesting repercussions for primary liability cases. As a result, this Note argues that Congress should amend the ATA to explicitly permit secondary liability. However, in order to guard against excessive suits against innocent banks, courts should only permit claims premised upon secondary liability in extreme cases where the bank manifested intent or extreme recklessness in their dealings with terrorist clients.