President Obama’s pledge to ease up on zakat payments, which have often been funneled to terrorism, appears to be manifesting itself in Leftist court rulings which will erode America’s ability to combat the flow of money to Jihadist terrorist organizations.

A recent court ruling that disallowed the freezing of an Islamic charity’s assets could signal a major change in how the United States sanctions suspected terrorist financiers.

The Bush administration accused Toledo, OH-based KindHearts for Charitable Humanitarian Development, Inc. in February 2006 of funneling money to blacklisted terror group Hamas but never prosecuted the organization. That month, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) froze $1 million of KindHearts’ funds.

On Tuesday, U.S. District Court Judge James Carr overturned the asset seizure.

The ruling is a harbinger of legal challenges facing cases initiated under the Bush administration, and “could set a precedent” that makes it more difficult for OFAC to freeze assets.

Should the decision survive an expected appeal, it will likely mean legal challenges from some of the more than 6,500 individuals and organizations named on OFAC’s specially designated nationals list.

The American Civil Liberties Union and several civil rights attorneys filed the lawsuit on behalf of the charity in November 2008, after KindHearts said that it would not be able to pay for legal representation without access to the frozen money.

If upheld, the ruling could force OFAC to meet an evidentiary threshold justifying economic sanctions-a criterion that the agency has thus far not had to contend with.

Moreover, the decision may limit how long the Treasury Department has to present such evidence to as little as three to six months.

And OFAC’s use of “classified evidence” may no longer be upheld by judges because defendants won’t have the opportunity to defend themselves against alleged proof they aren’t allowed to see.

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