Lawsuit Alleges World Bank Financed Reign of Terror Against Honduran Farmers Fighting Powerful Palm Oil Company

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1923
Men carrying palm oil fruits on their bicycles near plantations in Honduras. Photo: ICIJ

Washington, D.C. — A lawsuit filed in a U.S. court alleges that the World Bank Group aided a campaign of terror against peasants who have tried to block a powerful Honduran palm oil company’s expansion of its industrial-scale plantations.

The suit accuses the bank’s business lending arm, the International Finance Corporation, of “knowingly profiting from the financing of murder” by supporting the Dinant Corporation during a bloody land war in which the agribusiness conglomerate’s security forces allegedly murdered and assaulted local farmers. The case was filed in U.S. District Court in Washington, D.C., by EarthRights International, a nongovernmental organization concerned with human rights and environmental issues.

The suit on behalf of 17 Honduran farmers and their family members claims that Dinant hired “paramilitary death squads and private assassins” to eliminate opponents in the struggle over land rights in the Bajo Aguan region of northern Honduras. It alleges that the IFC “provided critical capital funding and moral cover” to Dinant even though it knew, or had reason to know, that Dinant was targeting peasants with threats and violence.

The case is a civil lawsuit seeking a finding of liability against the IFC and a subsidiary, the IFC Asset Management Company. Although no criminal penalties are at stake, it is the first time that communities affected by World Bank Group projects have accused the bank of criminal conduct, according to EarthRights.

Dinant is not a defendant, but it is accused in the suit of crimes including wrongful death, assault and false imprisonment. Seven of the plaintiffs are family members of peasants who allegedly were killed by security forces linked to Dinant.

Caroline Bettinger-Lopez, a professor at the University of Miami School of Law who specializes in international human rights law, said a central issue that would determine the lawsuit’s success was its challenge to the IFC’s claims of immunity.

A previous case filed by EarthRights involving an IFC investment in India was dismissed by a federal court due to the IFC’s immunity privileges, which are similar to those enjoyed by foreign governments. EarthRights has appealed that decision to a higher court.

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