The Banque du Liban (BDL) stated that it had responded to part of the clarifications requested by the cabinet, which were communicated through the Minister of Finance. (Credit: João Sousa)
BEIRUT — The Banque du Liban (BDL, Central Bank) held a meeting Wednesday with Alvarez & Marsal to officially launch a new forensic audit covering a selection of operations linked to its foreign assets and to monitor its implementation, the central bank said in a statement.
The firm officially began its work on Aug. 17, nearly three months after the BDL announced on May 26 that it had awarded the contract following a tender process conducted in accordance with Lebanese public procurement rules.
The audit covers the period from Oct. 1, 2019, to Dec. 31, 2023, and examines several operations related to the BDL’s foreign assets, including subsidy programs for essential goods and products, certain transfers to banks and the public sector, as well as letters of credit for fuel imports.
"The audit aims to examine these operations, trace associated fund flows and verify the procedures and mechanisms used for their implementation, based on the documents, data and records available to the various concerned parties," the statement said.
The period under review corresponds to the first four years of Lebanon's financial crisis, during which the BDL drew several billion dollars from its foreign currency reserves to finance various subsidy programs and operations. The mission aims to determine whether the payments and transfers were based on legal authorizations and carried out in accordance with existing procedures. It will also seek to establish whether the funds reached their intended beneficiaries and were used for their designated purposes.
Alvarez & Marsal also conducted the first forensic audit of the BDL, published in 2023, which estimated the cost of financial engineering operations during former governor Riad Salameh’s tenure at nearly $76 billion. However, the firm reported that it had not obtained all the information it had requested, as the BDL had cited banking secrecy. The new audit could help fill some of these gaps.
