Lawsuit Seeks to Stop U.S. Bailout of AIG as Anti-Christian, Anti-U.S.

December 16, 2008

A Michigan–based Christian rights group has filed suit against the federal government claiming the government’s loan to insurance giant American International Group (AIG) is illegal because AIG has financial products that the group claims promote Islam and are anti-Christian.

The federal lawsuit was filed against U.S. Treasury Secretary Henry M. Paulson, Jr. and the Federal Reserve Board and calls for a halt to all bailout monies going to AIG. AIG is not being sued.

The federal lawsuit challenges the $40 billion in taxpayer money that was loaned to AIG in September.

As part of the federal bailout, the government took ownership in AIG. The complaint maintains that the U.S. government now exercises such power over AIG that the decisions AIG makes are deemed to be those of the federal government. According to the lawsuit, the U.S. government, through its ownership of AIG, is not only violating the Constitution, but also “promoting and financing the destruction of America using American tax dollars.”

The suit was filed by the Thomas More Law Center, a not-for-profit public interest law firm that says it is “dedicated to the defense and promotion of the religious freedom of Christians, time-honored family values, and the sanctity of human life.” It says it provides legal representation without charge to “defend and protect Christians and their religious beliefs in the public square.”

The lawsuit alleges that AIG promotes Shariah-compliant businesses and insurance products (Takaful), which must comply with Islamic canon law based on the Quran, “which demands the conversion, subjugation, or destruction of the infidel West, including the United States.”

The complaint states in part:

“The Shariah-based Islamic religious practices and activities that the government-owned AIG engages in– activities that are funded and financially supported by American taxpayers, including Plaintiff, who is forced to contribute to them– are antithetical to our Nation’s values, customs, and traditions with regard to religious liberty, religious tolerance, and the proscriptions of the First Amendment. These government-funded activities not only convey a message of disfavor of and hostility toward Christians, Jews, and those who do not follow or abide by Islamic law based on the Quran or the teachings of the Prophet Mohammed, but they also embody actual commercial practices which are pervasively sectarian and which disfavor Christians, Jews, and other ‘infidels,’ including Americans.”

The lawsuit was filed in the Federal District Court for the Eastern District of Michigan on behalf of Kevin J. Murray, a former Marine infantryman who served two tours of duty in Iraq.

According to the lawsuit, use of taxpayer funds to acquire ownership of a business that “intentionally promotes, endorses, supports, and funds Shariah-based Islamic religious practices” violates both the Establishment Clause that prohibits the government from backing a religion and of the First Amendment to the U.S. Constitution.

According to the lawsuit, AIG, which is now a government owned company, engages in Shariah-compliant financing, which subjects certain financial activities, including investments, to the dictates of Islamic law and the Islamic religion. This includes any profits or interest obtained through such financial activities.

Also, according to the lawsuit, as part of Shariah financing, companies pay a religious tax. The suit maintains that this money must be used to financially support Islamic charities, some of which the lawsuit alleges have ties to terrorist organizations that are hostile to the U.S., Christians and Jews.

The complaint does not show that AIG has supported any such charity. According to David Yerushalmi, the attorney handling the case for the plaintiff, what, if any, charities AIG is supporting in not known at this time and “what AIG has in mind” will only be known after discovery.

“We don’t know yet. Typically, the ‘halal’ or approved charities has to
go through the Shariah authorities– at least that is what most European and Middle Eastern banks/financial institutions do,” he told Insurance Journal.

AIG established a company, AIG Takaful Enaya, in Behrain in 2006 to sell Takaful products, including accident and health, auto, energy, property and casualty products.

Last month, Risk Specialists Companies, Inc. (RSC), a subsidiary of AIG Commercial Insurance, introduced a Takaful homeowners insurance product in the U.S.

Takaful is similar to mutual insurance but investments of funds are restricted to avoid companies involved in entertainment, alcohol, pork and other elements prohibited by Islamic law.

According to Ernst & Young’s 2008 World Takaful Report, Takaful was estimated to be a $5.7 billion market globally with over 130 providers in 2006. The Takaful market is estimated to be in excess of $10 billion by 2010.

AIG, which is not being sued, declined comment on the suit.

Source: Thomas More Institute

Topics Lawsuits USA AIG

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