Seoul, Korea: Lebanese banks, which are recognised for their critical roles in local and regional economies, initiated strict measures against individuals or institutions in accordance to a US law that imposes sanctions on financial establishments that knowingly do business with Hezbollah, not just in US dollars but across the currency board.
Few expected the inclusion of non-dollar currencies to President Barack Obama’s “Hezbollah International Financing Prevention Act,” which was signed on December 18, 2015. Washington invited several Lebanese officials and bankers to discuss the move with American representatives. The most important official who made the trek was the Minister of Finance, Ali Hassan Khalil, a member of the Shiite Amal Party and a close adviser to Speaker Nabih Berri. Khalil was thus briefed on what was going to transpire.
Last week, the US Department of Treasury’s Office of Foreign Assets Control (OFAC), issued regulations aimed at implementing the Act. Importantly, and while many assumed that the strict measures would focus only on US dollars — since such transfers must necessarily go through New York — we now know that the new rules cover accounts in Lebanese Liras and all foreign currencies without any exceptions.
Many in Lebanon are worried that the US legislation will have negative effects on the Lebanese banking sector, which is one of the last functioning pillars of the economy, though Assistant Secretary of the Treasury Daniel Glaser may clarify how Washington intended to supervise these trades during his visit to Beirut next week.
Importantly, the American regulations insist that Washington will target those who “knowingly facilitate a significant transaction or transactions for” Hezbollah and those who “knowingly facilitate a significant transaction or transactions of a person identified on the List of Specially Designated Nationals and Blocked persons.”
The OFAC’s long list includes the names of leading officials, businessmen and institutions that the US claims are linked to Hezbollah, including Secretary-General Hassan Nasrallah and top military commander Mustafa Badreddine. The list also includes employees of the group’s Al Manar television station (which was recently yanked from the air on NileSat and is now available through a Russian Satellite), as well as Al Nour Radio.
In December 2015, Nasrallah insisted that his militia did not deal with Lebanese or foreign banks, which hinted that it received Iranian financial support in cash movements through Syria. Nevertheless, Beirut faced a fresh conundrum, especially if Hezbollah leaders, including members of parliament, now may see their bank accounts frozen.
