Ajcongress Brings Suit Against Treasury Department to Disclose Records of Arab Dollar Holdings

The Federal District Court for the District of Columbia has scheduled to hear oral arguments on March 19 in a suit brought by the American Jewish Congress to force the Treasury Department to disclose records showing the dollar holdings in the United States of Saudi Arabia, Kuwait and the United Arab Emirates.

The Jewish group, acting under the Freedom of Information Act, submitted a request to the Treasury Department last year to obtain the documents. It asked for release of data listing the amounts of funds on deposit in American banks and the amounts of Treasury bills owned or held by each of the three Arab oil-producing states.

AJCongress charged that the growing size of Arab investment in the United States is of “particular concern” because of the “concomitant increase in the influence by these three countries over American foreign policy in the Middle East.” It added that information obtained on the size and scope of such investments may form the basis for recommending further legislation.

The Treasury Department turned down the Jewish organization’s request. A subsequent administrative appeal was also rejected by Treasury officials. It claimed that under the International Investment Survey Act of 1976 and the Bretton Woods Agreement Act, the government is forced to keep such information confidential. These acts require the collection and publication of country-by-country data on foreign investments in this country, but prohibit disclosure of statistics on individual investors.

A suit was then filed on behalf of the AJCongress by Joel Levy, a Washington attorney and a vice president of the organization, seeking release of the material. The suit claims such disclosure would not violate the prohibition on invest investment data pertaining to holdings of individual investors.

CLAIMS AND COUNTERCLAIMS

AJCongress contends that since the specific documents requested are not exempt from disclosure under the terms of the Freedom of Information Act, the Treasury Department is legally obliged to release them. The act, continues the brief, “embodies a general philosophy of full agency disclosure.” Accordingly, the burden of establishing that certain items of information are exempt from disclosure rests with the Treasury Department. But the department has failed to prove such a case, according to the Jewish organization.

The Treasury Department maintains that the percentage of American bank deposits and Treasury bills held by single customers — in this case the governments of the three Arab countries involved — is so high that any publication of the information would be a disclosure of their individual investment positions. Treasury officials allege, therefore, that they are precluded from releasing the information without the written consent of the customers involved.

Furthermore, the Treasury Department contends it is justified in withholding the data because it has classified the information as “confidential” in the interests of national security. The AJCongress brief rejects the argument, saying Treasury does not have the right to classify data when Congress has ordered, through legislation, that such data be published.

The AJCongress claims that Treasury is in fact seeking to conceal individual figures for Arab states by lumping together the totals of the 13 Organization of Petroleum Exporting Countries (OPEC), a practice it does not follow with other nations.

The Jewish organization says the real reason is a 1974 commitment to Arab governments by William Simon, then Treasury Secretary, who wanted to induce the Arabs to purchase Treasury securities while protecting them from public knowledge of the extent of Arab investment in this country.

The refusal of the federal government to list country-by-country figures for the OPEC nations has also been challenged by the House Sub-Committee on Commerce and Monetary Affairs, chaired by Rep. Benjamin Rosenthal (D. NY) who has threatened to subpoena the concealed documents.