You might have heard about it, but never really paid attention.

Banking secrecy. It sounds like something straight out of a spy novel.

But in Lebanon, it’s been at the core of a financial system based on the permanent attraction of capital, sometimes illicit or derived from corruption. 

In 2019, things came to a head, when Lebanon’s financial crisis erupted. Millions of dollars vanished. This secrecy was a major reason why nobody has been held accountable since the 2019 crisis.

But that might finally be changing.

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On March 24, Parliament passed the third amendment to Lebanon’s banking secrecy law since the collapse of the financial system (back in 2019). It passed overwhelmingly: 87 MPs voted in favor, 13 against.

So, what does that mean? Why now? And could it finally help people recover what they lost?

Let’s break it down.

1. What is Lebanon’s banking secrecy law, and why does it matter?

Back in 1956, Lebanon adopted a law to protect the confidentiality of bank clients. The goal? Attract regional capital and become the Switzerland of the Middle East. 

But after the 1975-90 Civil War, even if the economic growth was still mainly relying on the financial sector and foreign capital attraction, the banking secrecy also enabled the surge of corruption, tax evasion, and financial crime.

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In 2019, because of the financial and economic crisis, depositors were locked out of their accounts. 

Yet despite widespread losses, no one was held accountable, because banking secrecy laws, one of other reasons, made it nearly impossible to trace responsibility.

2. What’s changed in the new amendments?

Under pressure from the IMF, international donors, and financial watchdogs, Lebanon passed new amendments in March 2025, arguably its most serious reform yet. Here's what’s different:

• 10-year retroactive scope: Investigators can now look back ten years to uncover potential money laundering or illicit enrichment. Thus, it allows them to go back as far as 2015, when Banque du Liban launched its first financial engineering projects, which many experts called a state-sanctioned Ponzi scheme.
• Audit access expanded: Auditors and evaluators, not just Banque du Liban (BDL) and the Banking Control Commission (BCC), can now access sensitive banking information.
• Previously, BDL and BCC were the only ones allowed, and both are widely seen as institutionally compromised in the system’s failures.
• Administrative process updated: Access to decisions no longer rests solely with the Finance Ministry - which is accused by some observers and MP’s to have failed to supervise BDL’s actions in the past – but now require a ministerial decree, with BDL consultation.

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3. Why does this matter? And will it help depositors?

This reform is a crucial step in Lebanon’s path toward financial accountability and economic recovery, even if it doesn’t mean immediate justice.

Here’s what it could change:

• Enable audits needed to restructure Lebanon’s broken banking sector
• Improve Lebanon’s standing on global watchlists (it’s currently on the FATF gray list)
• Help track and prosecute financial crimes and corruption
• Lay the groundwork to regain trust from depositors, investors, and international donors.

This is the first serious move in a process that could trace what happened to depositors’ money during the financial collapse in 2019.