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Terrorist attack victims ask Biden to take further action on $4 billion in frozen Afghan funds

More than 350 U.S. victims of terrorist attacks are formally asking President Joe Biden to move currently frozen Afghan assets into a fund created by Congress to benefit all families, according to a new letter obtained by CBS News.

"We write to you today with a respectful but urgent request: to move the currently frozen Afghan assets into the USVSST(US Victims of State Sponsored Terrorism) Fund to accomplish your goal of supporting U.S. terrorism victims," the families wrote in their Sept. 14 letter to the president. They  said that the decision to leave nearly $4 billion dollars for a New York court to decide compensation had created "vicious infighting, legal maneuvering, and political gamesmanship that has beset our friends, colleagues, and loved ones regarding the best fair and equitable way to distribute the $3.5 billion in frozen DAB (Da Afghanistan Bank) funds."

A "CBS Mornings" investigation earlier this year revealed a race to the courthouse, after the president signed an executive order in February that left the frozen Afghan funds with a New York court to consider victim compensation claims.

Last month, a New York magistrate said that she was unable to disburse any of the frozen assets and recommended against allowing a small group of 9/11 families with claims against the Taliban to draw on the assets.

Magistrate Judge Sarah Netburn ruled that although these families "have fought for years for justice, accountability and compensation" and deserve these outcomes, nonetheless, "the law limits what compensation the Court may authorize and those limits put the DAB's assets beyond its authority."

The families, in their letter to Mr. Biden, suggested that the court's ruling stems from a "misunderstanding" that preceded his executive order. As a result of the order, they said the funds "were inadvertently earmarked for only a very small group of victims." This, they said, "can now be corrected by continuing to preserve the $3.5 billion for victims of terrorism and asking Congress to pass legislation that would ensure that the funds are directed to the USVSST Fund."

The families said the New York judge's recommendation provides "a new window of opportunity to ensure that victims of terrorism are compensated fairly and equitably."

In 2015, with bipartisan support, Congress created a fund to compensate all terrorism victims with final judgments against state sponsors of terrorism. It's funded through fines and penalties and has disbursed  more than $3 billion in claims.

After the U.S. pulled out of Afghanistan, it froze $7 billion in assets from that country's central bank to keep the money out of the hands of the Taliban, which had seized control from the Afghan government.  At the time some families expected at least part of the money would go to the victim compensation fund. 

The CBS News investigation team spoke with 77-year-old Bob Essington, who in 1983 sustained permanent injuries when a suicide bomber used a car bomb to destroy the U.S. Embassy in Beirut, killing 63 people. 

The explosive force compressed Essington's spine, permanently impairing his mobility. 

"I have a stimulator implanted in my hip with 14 plates on my spine. If I shut it off, I go into instant pain. And there's nothing to stop the pain," he told CBS News. 

At the time, Essington and other families were surprised by Mr.  Biden's order to earmark $3.5 billion to support "the urgent needs of the people of Afghanistan."   

On Thursday, the U.S. and international partners set up a fund in Switzerland to disburse some of those assets to help stabilize Afghanistan's economy and "work to alleviate the worst effects of the humanitarian crisis" there, a State Department spokesperson told CBS News. The money is to be used to pay for electricity imports and covering arrears at international financial institutions. The State Department also said that the Taliban "are not a part of this financing mechanism." Safeguards are in place, the department said, to protect the funds from being diverted or misused.

The remaining $3.5 billion went to the court to decide compensation, with a small group of 9/11 families who have brought claims against the Taliban at the head of the line for the funds. 

"We're not going to get anything for what happened to us. You know, it's like the government doesn't care anymore," Essington said. 

Kenneth Feinberg, who has overseen more than $20 billion in victims' compensation, including claims by 9/11 families, called Mr. Biden's executive order "very unusual." 

In addition to the fund created by Congress, Feinberg said the federal court was also an option to handle victims' claims, but opined that no decision is without controversy.

"You're going to get frustration and emotional disagreement and anger no matter how you distribute $3.5 billion dollars," Feinberg said.

Victims of terrorist attacks in the '80s and '90s against U.S. embassies and military installations sent an earlier letter to Mr. Biden, urging him to change course.

They wrote that the Victim Compensation Fund was created "for exactly these moments…for the benefit of all U.S. terrorism victims, not one small group."

At that time, the White House told CBS News the administration "undertook extensive analysis on this complex issue" that factored in the urgent need for Afghan aid and victims' compensation, adding the administration "could not simply transfer" to the victims' fund.

Feinberg agrees that the compensation from the funds should be more broadly distributed. "These programs are more than just sort of taking a calculator and deciding who gets what. There's a very important element I learned the hard way in 9/11 fund: giving everybody a voice," he said. 

Last summer, more than 300 veterans and their families wrote to the House and Senate Armed Services and Veterans committees, urging them to support legislation that redirects the money to the victims' fund.

Critics of the executive order say it punishes the Afghan people, who face a humanitarian crisis, and all of the money rightfully belongs to them.

The Taliban said in a statement that the decision of the U.S. to transfer part of the reserves to Switzerland for disbursement without their input is "unacceptable and a violation of international norms" and complained that the U.S. was undermining the "economic stability and well-being" of the Afghan people.

CBS News asked the White House whether Mr. Biden would act on the new request from the families, and whether there would be action before the midterm elections.  There was no immediate response.

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