Many have blamed BDL in part for the disastrous economic crisis facing the country. (Credit: Fathi Al-Masri/AFP)
BEIRUT — Lebanon has set aside LL4.9 billion for a long-awaited forensic audit of the country’s central bank, President Michel Aoun announced Wednesday.
Here’s what we know:
• Aoun tweeted that he had signed a decree allocating the money for consulting firm Alvarez & Marsal to carry out the forensic audit of Banque du Liban.
• However, a new contract will need to be signed before the firm begins its work.
• A spokeswoman for the Finance Ministry told L’Orient Today that further details will be shared once both parties sign a contract for the audit, adding that no start date had been confirmed yet.
• If a contract is signed, it will not be the first. In September 2020, Lebanon signed a $2.1 million contract with Alvarez & Marsal for an audit of the central bank’s accounts, but the company met with a lack of cooperation from the central bank, which spuriously argued that banking secrecy rules prevented it from doing so.
• Alvarez & Marsal abandoned its effort in November 2020, but was not paid the contract’s $150,000 termination fee until August of this year.
• In December 2020, Parliament passed a law explicitly lifting banking secrecy for central bank accounts, in order to remove the alleged obstacle, but the provision expires at the end of this year, giving Alvarez & Marsal just four months to complete the new contract unless Parliament acts to extend the secrecy exemption.
• Proponents of the audit say that it will help understand how Lebanon’s financial system collapsed so dramatically over the past two years — and pave the way for accountability measures. Since 2019, the lira has lost over 90 percent of its exchange value against the US dollar, while banks illicitly restricted withdrawals, largely cutting people off from their life savings and casting the majority of Lebanese into poverty.