Knesset Committee to Discuss Banking Discrimination Against Arabs

Banking supervisor reiterates that discrimination is unacceptable and solicits public to report bias to the central bank.

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The Knesset Economic Affairs Committee has scheduled hearings next week on banking services provided to Israeli Arabs, following the expose in Haaretz on Monday about Mizrahi-Tefahot Bank’s denial of credit to Israeli Arabs and findings by the Knesset research center that bank fees are higher in Arab communities.

"What has been revealed here is an ugly phenomenon of discrimination against minorities by banks in Israel," said committee chairman Avishay Braverman (Labor) Tuesday. "I would have liked to think that this involves the local actions of bank clerks, but the number of incidents raises the suspicion that it is a policy dictated from on high, or at least a failure on the part of the management of the banks."

Former Knesset speaker Reuven Rivlin (Likud) expressed his revulsion at the revelations. "Unfortunately, no excuse or explanation will hide the painful recognition that there is a deep societal flaw within us," he said. Citing other businesses that have been associated with allegations of bias, including anti-Arab behavior on the part of Beitar Jerusalem soccer fans, Rivlin said: "Beitar, Superland [amusement park], Bank Hapoalim and now Mizrahi bank show that discrimination is deeply rooted among us - and that society relates to it apathetically and lets it pass."

Noting that Arab Israelis "were born in this country" and Druze Israelis have what he called a "blood-brothers' pact with us in defense of this country," Rivlin deplored their portrayal by some Israelis as the enemy. "We are in the midst of an ugly wave seeking to undermine our [existence as a] Jewish and democratic state. We need to respond strongly on the educational and punitive level," he said.

The banking supervisor at the Bank of Israel, David Zaken, has come in for criticism from Knesset members for not intervening to prevent discrimination against Arabs in the banking sector, including the higher fees that Arab customers reportedly pay. Zaken's office has not carried out a thorough study of the matter, even though evidence of the problem surfaced several years ago, they said.

Zaken’s office said in response that, "We cannot respond to matters related to a specific bank. One of the roles of the office is to ensure that relations between the banks and customers are conducted fairly and, from the perspective of the office, discrimination against [a particular] sector is certainly not fair treatment. Therefore, the argument that the office does not view the fight against discrimination in banking services as part of its job is baseless. The Bank of Israel's public enquiry unit has never ignored an enquiry from any citizen related to banking service discrimination. Arab citizens who encounter what they believe is discrimination are invited to contact the public enquiry unit at the Bank of Israel."

With reporting by Jonathan Lis.

A Mizrahi-Tefahot Bank branch. Credit: Moti Milrod
Banks Supervisor David Zaken.Credit: Tomer Appelbaum

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