A European judicial delegation from France, Germany, and Luxembourg has started to arrive in Lebanon to probe the country's Central Bank governor and dozens of other individuals over suspected corruption, the justice minister said Wednesday.
Five European countries are probing the embattled governor, Riad Salameh on allegations of laundering public money in Europe. Switzerland first opened a probe two years ago, followed by France, Germany, Luxembourg, and Liechtenstein.
Since 2019, Lebanon has been in the throes of the worst economic and financial crisis in its modern history, rooted in decades of corruption and mismanagement. Three quarters of the country’s population now lives in poverty.
Once hailed as the guardian of Lebanon's financial stability, many in the cash-strapped country now hold the 72-year-old Salameh responsible for the crisis, citing policies that drove up national debt and caused the Lebanese pound to lose more than 90% of its value against the dollar. The governor, who has held the post since April 1993, still enjoys the backing of top politicians.
Activists and lawyers have questioned the personal wealth Salameh has amassed over the years, though he has repeatedly insisted that he earned it prior to his appointment as governor while working as an investment banker for Merril Lynch for nearly two decades. He said his last salary was $2 million a year, and that he had a fortune worth $23 million, plus property he had acquired and “wisely invested” in to grow his wealth, before he became governor.
Caretaker Justice Minister Henri Khoury said in a press conference that the German delegation had arrived to Lebanon, while their counterparts from France and Luxembourg are scheduled to arrive next Monday. They will leave the country four days later, he said.
“It is no longer a secret that Lebanon received requests for legal assistance from Germany, France, Luxembourg, and Switzerland,” Khoury said, adding that Lebanon sent Switzerland, Germany, and France “numerous pieces of evidence that they requested”.
The European judges look to question over a dozen individuals, notably the governor, his brother Raja Salameh, the heads of major commercial banks in Lebanon and the auditors of the central bank.
French, German and Luxembourg authorities in March froze more than $130 million in assets belonging to five suspects linked to a money laundering investigation of $330 million and 5 million Euros. It is widely believed that the Salameh brothers are among them.
The office of Switzerland’s attorney general said in January 2021 that it requested legal assistance from Lebanon. A document of the request obtained by The Associated Press showed that federal prosecutors heavily inquired about the Lebanese Central Bank’s relationship with Forry Associates Ltd, a brokerage firm owned by Raja Salameh.
Several reports have said that Riad Salameh hired the firm to handle government bonds sales by the Central Bank in which his brother's firm received about $330 million in commissions. The governor said last November that “not a single penny of public money” was used to pay for Forry Associates Ltd.
Zeina Wakim, a lawyer who heads the Swiss organization Accountability Now that filed legal complaints against Salameh and affiliates in Switzerland, France, and the United Kingdom, said she expects “limited cooperation” from the Lebanese to “show good face” due to the country’s strong ties between the politicians, banks, and judiciary.
“The delegation will realize what it means to have the 18 largest banks in Lebanon controlled by the elite,” Wakim told the AP. “Any genuine and real cooperation in Lebanon — be it a bank, public official, or judge — would be a strike to the system itself because of this connection between the banking oligarchy and the political elite, and obviously the governor of the central bank.”
Lebanese investigative Judge Ghada Aoun has also pursued Salameh and his affiliates in 2022, freezing some of Salameh's assets, slapping a travel ban, and briefly arresting his brother Raja. In March 2022, she charged Salameh and his brother with illegal enrichment and money laundering.