New Law Aids Victims of Terrorism

Edwena Hegna waited 18 years for a measure of justice in her husband’s slaying by terrorist hijackers.

On Tuesday, she finally got it when President Bush signed into law a bill letting victims of terrorism collect multimillion-dollar judgments from about $4 billion in frozen assets of suspected terrorist groups and the seven nations that the U.S. accuses of sponsoring terrorism.

“I know my husband’s looking down,” she said after attending the bill signing at the White House. “The sense of relief after 18 years is just so overwhelming.”

The provision was part of a terrorism insurance bill that Bush has touted as an economic stimulus measure. The core of the bill will provide federal backup insurance against damage caused by future attacks.

“We’re defending America by making our economy more secure,” Bush said.

But it was the lesser-known provision dealing with the frozen assets that drew victims of terrorism and their families to the White House.

“One way to confront terrorist organizations is to hit them in the pocketbook,” said Rep. Vito Fossella (R.-N.Y), a leading sponsor of the bill in Congress.

It is unknown how many people are affected by the provision, but it is estimated to be in the hundreds. The lawsuits range from terrorist bombings in Israel to kidnappings in Iraq and confinements in Kuwait and Libya.

Hegna, who is 61 and now lives in Arizona, had written Bush, reminding him that his father, then the vice president under President Reagan, had promised that “justice would be served” as the flag-draped casket bearing her husband’s body arrived home in 1984.

Charles Hegna, 50, father of four and an auditor for the U.S. Agency for International Development, was flying from Kuwait to Pakistan when Hezbollah militants hijacked the plane to Tehran. Hegna was beaten, shot in the stomach and shoved out of the airplane door to the tarmac. As he lay on the ground, the terrorists shot him again. Earlier this year, Hegna’s family won a $42-million judgment against Iran in federal court.

Six years ago, Congress gave victims of terrorism the right to sue countries on the State Department list of nations that sponsor terrorism -- Cuba, Iran, Iraq, Libya, North Korea, Sudan and Syria. Currently, no Syrian funds are blocked.

However, Americans who have won court cases for attacks on them or their families have had difficulty collecting.

The State Department resisted releasing the assets, contending that they can provide an important bargaining chip in U.S. diplomacy. Officials were also worried that releasing the funds could provoke attacks on U.S. property abroad.

“Assets are blocked in the national interest, so they can be used as leverage and bargaining chips with states not friendly with the U.S.,” said a State Department official who spoke on condition of anonymity. The assets “are also used to assist our foreign policy in dealing with successor regimes that turn out to be friendly to the U.S.”

The legislation is expected to pave the way for release of the funds, according to the families of victims and their attorneys.

“Finally, the victims are going to see justice,” said Dan Wolf, a Washington attorney representing Americans who allege they were seized and used as “human shields” on potential targets in Iraq when President Saddam Hussein’s regime invaded Kuwait in 1990. All were released shortly before the Persian Gulf War.

Wolf’s clients include Jack Frazier, a former Santa Ana resident waiting to collect $1.7 million 12 years after he was held hostage by the Iraqis.

“Even if we don’t get the money by Christmas, it’ll still be a good Christmas present,” said his wife, Deanna. “Jack isn’t doing well at all. He will never get over what happened. He sometimes feels like a forgotten man.”

When Iraq invaded Kuwait in August 1990, Frazier was a field superintendent for the Bechtel Corp. at an Iraqi oil refinery outside of Baghdad.

At the time, he suffered from a mild case of diabetes that he controlled with medication. Iraqi soldiers took away his medicine, however, and Frazier’s condition worsened during his almost three months in captivity. When he was released in October 1990, he had lost sight in his right eye.

His medical problems worsened over the years, and he is mostly confined to a wheelchair and has problems feeding himself, his wife said. Today, the couple live in Lake Havasu City, Ariz., where Frazier is in a care facility. “We’ve gone through gangbusters to get justice for Jack,” said his wife. “We never expected justice from Hussein. But we also didn’t expect our government to side with Hussein when we tried to collect his award from the court.”

The legislation was prompted by last year’s terrorist attacks, which have led to insurance claims estimated at $40 billion to $50 billion. Responding to insurance company warnings that they could be ruined by another attack, the new law makes insurers eligible for reimbursement of 90% of claims once losses exceed $10 billion in 2003, $12.5 billion in 2004 and $15 billion in 2005. Losses will be capped at $100 billion, until the program ends in three years.

“Should terrorists strike America again, we have a system in place to address financial losses and get our economy back on its feet as quickly as possible,” Bush said.

Rodger S. Lawson, president of the Alliance of American Insurers, said the law will “spread the risk, stabilize the market, and give insurers the opportunity to once again provide coverage without the pending threat of insolvency from a future terrorist act.”

In pushing for the legislation in recent weeks, Bush had stressed that the unavailability or high cost of terrorism insurance had made it difficult for some construction projects to obtain financing.

Some Republicans were upset that the bill did not prohibit individuals injured in an attack from suing businesses for punitive damages. But Bush said he plans to work with the Congress on stronger measures to prevent “abusive lawsuits.”