Biden Freezes US-Held Assets of the Central Bank of Afghanistan in Executive Order
President Joe Biden froze U.S.-held assets in the central bank of Afghanistan via an executive order issued Feb. 11. In response to "the widespread humanitarian crisis in Afghanistan," the president declared a national emergency. Citing the "potential for a deepening economic collapse in Afghanistan" that could threaten U.S. "national security and foreign policy," Biden ordered the freeze to facilitate access to $3.5 billion of those assets for the benefit of the Afghan people and their urgent need for "food security, livelihoods support, water, sanitation, health, hygiene, shelter and settlement assistance." The order blocks the transfer of bank property held in the U.S. by U.S. financial institutions. All property that is held in the U.S. by an American institution is, as of Feb. 11, blocked and may not be transferred, paid, exported, withdrawn, or otherwise dealt in, and will be transferred into a consolidated account held at the Federal Reserve Bank of New York.
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The accompanying fact sheet notes that the EO is part of a larger U.S. effort to transfer a significant portion of the funds to meet the needs of the Afghan people and is "designed to provide a path for the funds to reach the people of Afghanistan, while keeping them out of the hands of the Taliban and malicious actors."
Several parties, including victims of terrorism, have ongoing legal battles involving portions of the frozen assets. The order acknowledges that even if funds are transferred for the benefit of the Afghan people, more than $3.5 billion in assets would remain in the U.S. and available for court actions. Due to "the ability to transfer funds and other assets instantaneously," Biden determined that it was necessary to give no prior notice of the order that goes into effect immediately.