The street of the Banque du Liban in Jounieh, in Kesrouan. (Credit: Philippe Hage Boutros.)
BEIRUT — Banque du Liban (BDL) affirmed on Thursday that it continues to take all necessary legal measures to pursue individuals or entities, suspected of corruption with direct or indirect ties to the bank.
This announcement was made as the former governor of the BDL, Riad Salami, faces charges in various embezzlement and illicit enrichment cases in several European countries and in Lebanon. Several people in his entourage, including his brother Raja and his son Nady, are also under prosecution in Lebanon and internationally, as well as two lawyers who were linked to the central bank.
In a statement, the BDL explained it is "cooperating with specialized law firms in several European and foreign countries" in order to "pursue any legal or natural person who has held functions within the Bank or has been linked to it, directly or indirectly, and is suspected of having participated in embezzlement or any other form of illicit enrichment."
Salami has been detained in Lebanon since September 2024 in the case of the alleged embezzlement of the BDL's "consultation account," for which an indictment was issued on April 8 by the acting first investigative judge of Beirut, Bilal Halawi. The latter accused the ex-governor of the BDL "of embezzling public funds, document forgery, and illicit enrichment," as well as two lawyers, Micky Tweni and Marwan Issa al-Khoury, of facilitating transfers that allowed funds from the "consultation account" to reach Mr. Salameh's private account.
The consultation account includes, among other things, funds from commissions collected through operations conducted between the BDL and a brokerage firm, Optimum Invest, between 2015 and 2018, for which both the firm and Salami deny any wrongdoing. Some of these funds were allegedly transferred to private accounts through commercial banks.
Alvarez & Marsal has "received all the required information from the BDL"
Regarding the forensic audit of the BDL, and while the current governor, Karim Souhaid, had recently asked Alvarez & Marsal to specify the missing information in its report published in 2023, BDL stated that the audit firm "confirmed having received from the BDL all the required information to complete the first phase" of the mission assigned to it by the Finance Ministry.
BDL is thus ready to "fully cooperate if the Lebanese state decided to expand the scope of the mandate, in accordance with the principle of transparency," according to the text.
The audit of the central bank is one of the conditions requested by the international community to accept providing Lebanon with financial aid in the context of the economic crisis the country has been experiencing since 2019. Alvarez & Marsal first signed a contract with the Lebanese state in September 2020 to trace the path of transactions recorded in the BDL's accounts, but the firm withdrew in November of the same year due to the institution's refusal to provide the requested information, under the guise of banking secrecy.
After Parliament passed a law in December 2020 lifting banking secrecy on the BDL's and public institutions' accounts for one year, the firm concluded a new contract with the state in September 2021. The results of the control operation were supposed to appear a year later but were finally released in 2023, with a nine-month delay.
On the legislative reform front, while a bill for the restructuring of the banking sector is under consideration in Parliament, the BDL also states it is coordinating with the executive branch and parliamentary committees "to review certain provisions of the proposed bills to ensure compliance with existing banking laws, while preserving the independence of the Bank and the protection of its prerogatives."
It reiterated that it does not propose or adopt laws itself but plays an advisory role to the government, in accordance with the framework of its missions and prerogatives defined in the currency and credit code. The banking resolution bill under study by the committee is supposed to set the legal framework for the restructuring of the sector, which has been virtually bankrupt since the beginning of the crisis.
