The Banking Industry's Seedy Relationship With Cluster Bombs

Next time you go to make a loan payment with your bank, you might want to take a second and ask the bank teller if any of your money will go toward developing a weapon that has killed and injured thousands of innocent people.

It turns out that a number of giant global banking firms, from HSBC to Bank of America to Goldman Sachs and Barclays, are investing in companies that manufacture cluster bombs. They are pretty heinous weapons that are the focal point of an international treaty that prohibits them. Cluster bombs are explosive weapons that release smaller bomblets in the air, and are meant to blanket a certain geographic area.

Therein lies one of their biggest problems – you can’t control their trajectory very well, so oftentimes they end up falling in soccer fields where children play or in rows of crops that farmers tend, or they get caught up in telephone wires or trees. They also have an extremely high dud rate, which means that instead of exploding on contact with the ground or with a building, they land and become de facto landmines, waiting to explode until some innocent person or group of people accidentally step on them.

Given the global financial crisis, it’s pretty clear that banks are hurting for business. But should they really be out to make a profit on weapons that have resulted in widespread civilian casualties?

The report on the banking industry’s support for companies that manufacture cluster bombs was written by Netwerk Vlaanderen and IKV Pax Christi, two Dutch human rights outfits. They note in their research that several weapons manufacturing firms benefit from investment by the banking industry, most notably Textron and Lockheed Martin, two U.S. companies. Coincidentally, the U.S. has not yet signed on to the international treaty to ban cluster bombs. That treaty is known as the Convention on Cluster Munitions.

Esther Vandenbroucke of Netwerk Vlaanderen told the Guardian that it requires all actors, from governments to the private sector, to work together to ban cluster bombs.

“The responsibility to ban cluster munitions is a shared responsibility. It requires courage, and it requires an effort,” Vandenbroucke said. “We are just months away from an international treaty entering into force and it is time for signatory states to the Convention on Cluster Munitions, for non-signatory states, and for financial institutions to act now.”

To date, at least 101 countries have signed the Convention on Cluster Munitions. Last month, Burkina Faso and Moldova became the 29th and 30th countries to ratify the Convention, which means that the Convention on Cluster Munitions now becomes official international law.

Meanwhile, estimates say that there are upwards of tens of millions of cluster bombs that haven’t yet exploded in the world, in places like Laos, Lebanon, and Georgia. If banks are going to be willing to continue to invest in these weapons, they should know that the results of their investment could be thousands of innocent casualties—people who did nothing more than go about their day, but stepped on a weapon no larger than a soda can. Who knew the term “collateral damage” could be so tragically literal?

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