Latest news with #RiadSalameh
The Hill
2 days ago
- Business
- The Hill
Trump should weaponize the Financial Action Task Force to make America safer
President Trump promised to make America safer, stronger and more prosperous. To fulfill that vision, he is already deploying bold leadership. But he also has at his disposal underused tools that can maximize U.S. leverage without relying on foreign aid or military deployments. The Financial Action Task Force is exactly that kind of instrument: a high-impact, low-cost global watchdog that targets the arteries of illicit finance. The Financial Action Task Force isn't a bureaucracy or a treaty-bound institution. It's a results-driven enforcement regime with teeth. By controlling access to global financial systems, the Financial Action Task Force can compel reforms in countries that sponsor terrorism, enable kleptocracy or tolerate organized crime. It's a tool of pressure that strikes where it matters most: capital and markets. And it fits naturally with the president's transactional, results-focused style. The most compelling case for the task force's power isn't theoretical — it's real. In 2018, the Financial Action Task Force gray-listed Pakistan for failing to curb terrorist financing. The fallout was swift. Foreign investment dried up, banks pulled back and multilateral lenders grew wary. The financial squeeze was real — and effective. What followed was a sweeping reform campaign. Over four years, Pakistan passed dozens of laws, empowered regulators, froze assets of proscribed groups and brought prosecutions under revamped statutes. The Financial Action Task Force verified that Pakistan had completed all 34 required actions and removed it from the gray list in 2022. Pakistan remains under post-delisting monitoring. The Financial Action Task Force and its members, including the U.S., continue to assess compliance. Given Pakistan's sustained reforms, that status should be extended in good faith — demonstrating that countries which follow the rules earn lasting recognition. This isn't about rewarding friends — it's about reinforcing the Financial Action Task Force's credibility. When countries respond to pressure with meaningful reform, they should be acknowledged. That sends a message to others: the system works, and performance earns a path back to legitimacy. Lebanon offers the opposite example. Once a financial hub, it has collapsed into dysfunction. Since 2019, Lebanon has suffered one of the worst economic meltdowns in recent history, driven by corruption and mismanagement. Former central bank governor Riad Salameh faces international investigation for laundering hundreds of millions of dollars. Trust in the banking sector has vanished. Hezbollah, a U.S.-designated terrorist group, freely exploits the chaos in Lebanon, financing itself through narcotics, smuggling and unregulated remittance networks. The Financial Action Task Force's mission is to prevent exactly this. Yet Lebanon has not been gray-listed. That's a serious oversight. A listing would pressure Lebanese elites, constrain Hezbollah's funding channels and expose Iranian influence — all without deploying a single U.S. asset. It would show that the global financial system has rules, and they are enforced. Other countries also demand scrutiny. Turkey is already gray-listed but shows inconsistent implementation. Nigeria, with its vast informal economy and entrenched corruption, remains a potential hub for illicit flows. These gray-zone economies blur the lines between legal and criminal finance. The Financial Action Task Force gives the U.S. a way to highlight these risks — and demand reform — without direct intervention. The Financial Action Task Force is tailor-made for Trump's approach to global engagement. It relies on measurable benchmarks and delivers tangible consequences. It doesn't care about ideology. It cares about enforcement, audits, prosecutions and safeguards. That makes it the perfect fit for a doctrine based on leverage and accountability. To fully unlock the Financial Action Task Force's potential, President Trump should: Skeptics claim multilateralism has no place in nationalist policy. But the Financial Action Task Force isn't the United Nations. It's a coalition of financial powers — many U.S.-aligned — that enforces rules through markets, not mandates. It doesn't issue demands — it denies access. That's why it works. The Financial Action Task Force lets the U.S. shape behavior globally through compliance. No tanks. No foreign aid. No drawn-out negotiations. Just access — or the loss of it. In today's world, real power lies not only in weapons, but in finance. In deciding who moves money, who attracts capital and who retains legitimacy. Trump understands deals. The Financial Action Task Force is a deal: meet the standard, and you're in. Fall short, and you're out. We have seen the positive impact the Financial Action Task Force has had on Pakistan. Using Pakistan as an inspiring example, President Trump should strongly advocate the task force be effectively applied to other nations. That's not globalism. That's leverage. And it's a roadmap to a world that's safer, stronger and more prosperous — on America's terms. Christopher Shays served in Congress from 1987 to 2009. He held key committee leadership positions overseeing budgets for the departments of Defense and State.
The National
24-04-2025
- Business
- The National
Lebanese parliament approves law lifting banking secrecy
The Lebanese parliament has approved a law aimed at removing banking secrecy in the country, a key reform demanded by the International Monetary Fund for a $3 billion package to be delivered. A majority of 87 MPs voted for the law, while 13 were against in the 128-member legislature. There is a 10-year retroactive clause in the law, meaning that it will apply to all accounts dating back to 2015. For decades Lebanon had been known for its banking secrecy, which prevented banks from disclosing any information about their clients or their accounts to anyone. But while that secrecy was once seen as a tool to help the economy, in recent times it has been viewed as a cover for corrupt practices. Former central bank governor Riad Salameh has been detained over charges of embezzling public funds. Nady Salameh, the son of Riad, is among close relatives of top officials accused of transferring money abroad and evading the withdrawal restrictions faced by most Lebanese. The IMF deal entered into a staff-level agreement with the state in April 2022, but Lebanon was accused of dragging its feet in introducing the reforms required. Economic reform Lebanon's new leaders insist they are committed to the IMF programme but have sought to renegotiate it. International donors have also made economic reform, which would include lifting baking secrecy, a key requirement for Lebanon to access the much-needed aid to rebuild the country after it suffered widespread devastation during Israel 's war with Hezbollah last year. Lebanon's economy, already struggling at the time, experienced a severe downturn in 2019 that has been blamed on decades of financial mismanagement and corruption by the country's ruling classes. The crisis has culminated in the depreciation of the local currency, falling by more than 95 per cent against the US dollar. It has also seen depositors locked out of their savings.
The National
16-04-2025
- Business
- The National
HBSC's Lebanese troubles make the case for top-level accountability
Thanks to The National, we now know that for more than 10 years, HSBC turned a blind eye to alleged substantial money laundering by Raja Salameh, brother of Lebanon's former central bank chief, Riad Salameh. Suspicious transactions totalling hundreds of millions of dollars were allowed to go unchecked by the bank's Geneva branch. This, despite compliance officers raising red flags including a 'lack of information on the transactions', according to the internal documents seen by The National. Concerns were dismissed as 'inappropriate' by Raja Salameh's representative, who described him as a man of 'morality'. Raja is accused of helping embezzle $300m in public funds from Banque du Liban, between 2000 and 2015. Now, thanks to some excellent journalism, attention is focusing on the alleged enablers behind the international scheme, among them the banks that were happy to allow Lebanon's ruling elite carte blanche so long as the country's financial system was solid. Barring this trade was not worth it, seemingly, in the larger picture of netting the country's overall banking business. As a result, HSBC allowed Riad Salameh and his associates to purchase luxury properties abroad and salt away the cash. The papers reveal that one single HSBC manager was able to repeatedly bypass the bank's internal controls. HSBC refuses to comment. Meanwhile, the Swiss authorities have banned the bank from taking on new politically exposed customers and Lebanon has filed a lawsuit against HSBC – its first against a foreign bank – accusing it of failing to conduct proper due diligence. On it goes, another case against HSBC and yet another against a major bank that says one thing about complying with the law and cracking down on illicit money flows, but is then shown to have done something quite different. For me, it has an especially familiar ring. In my book, Too Big To Jail, I detailed how HSBC, the giant multinational that likes to portray itself as 'the world's local bank', the friendly face of corporate and personal finance, acted as a conduit for the fearsome Mexican Sinaloa crime cartel led by El Chapo to wash its ill-gotten drugs proceeds. It was an exposé that rang across Hong Kong, London, Washington, the Cayman Islands and Mexico. At the end, I highlighted other centres where HSBC operated that also aroused concern. One was Switzerland, where court evidence disclosed HSBC admitted to conspiring with clients to commit US tax fraud, tax evasion and filing false tax returns. How much was being kept from US officials? Said the papers: 'HSBC Switzerland held approximately $1.26 billion in undeclared assets for US clients.' Asked to co-operate by US investigators, HSBC claimed Swiss bank secrecy. It chose to supply account codenames and numbers rather than identifiable details and used nominees in the British Virgin Islands, Liechtenstein and Panama to conceal their true ownership. The HSBC Swiss bankers allegedly flew to the US to drum up tax evasion business – 'at least four HSBC Switzerland bankers travelled to the United States to meet at least 25 different clients. One banker also attended Design Miami, a major annual arts and design event in Miami, Florida, in an effort to recruit new US clients to open undeclared accounts with HSBC Switzerland.' For that, the bank was required by the US Justice Department to pay a penalty of $192.35 million and given three years to demonstrate good conduct. Compared with the fine imposed for money laundering for 'drug kingpins and rogue nations', including El Chapo and his organisation, and considering how US prosecutors framed the charge, that was small. Then, HSBC was hit with a record US fine of $1.9 billion. Some, but not all, of the period covered by The National report relates to the years when the bank was facilitating El Chapo and other criminals. It was a time when the banking behemoth had grown massively and rapidly, when it had become more difficult to manage. That expansion, however, was not the concern of law enforcers or indeed the society and public they were responsible for protecting. HSBC was assuring all and sundry that its checks and balances were sound, that it was a stickler for operating by the rules. The comfort it provided gave the company licence to pursue a relentless policy of growth – it wanted to become the biggest bank in the world – and to make acquisitions around the world. At every turn, country regulators were promised the bank would stick to the tightest controls and standards and permission to proceed was granted and renewed. Some, but not all. HSBC was fined by the US in late 2012. Their inquiries centred on the period 2003 to 2010. The Lebanese laundering through the bank's Swiss subsidiary took place from 2000 to 2015. There were two aspects of the El Chapo story that were shocking. One was the brazen nature of his money-cleansing – ever the organiser, he went so far as to have special pouches made that exactly fitted the cashiers' windows so the dollars from selling drugs on the streets of the US could be slid seamlessly through – and the other was how the American government was keen to jail those bankers and executives they deemed responsible but the British, in the form of the then UK chancellor, George Osborne, persuaded them otherwise. HSBC was Britain's largest bank and to do so risked bringing down not only British banking but that of Europe and the wider world – the entire financial edifice was said to be in danger. Reluctantly, the US swallowed the line and chose to fine HSBC instead. No individual HSBC employee was pursued. While El Chapo and other cronies are serving lengthy prison terms, the banking legitimisers walk free. A third, which is related to the second, is that no public inquiry has ever been held, the UK government and regulators failed to act – this, despite its biggest bank having been fined the largest amount in US history. No senior banker was prosecuted for taking the world to the brink of financial meltdown in 2008, a crisis that required the injection of taxpayers' funds and still depressed markets. Similarly, no senior banker has gone to jail for ignoring compliance procedures and helping criminals launder their cash. Governments can huff and puff as much as they like and proclaim things are getting ever tighter, but until they do, until bankers' personal reputations are ruined and the corporate brand is sullied, nothing will change. Sadly, there will be other cases like that of HSBC Geneva. Chris Blackhurst is the author of Too Big To Jail – Inside HSBC, the Mexican Drug Cartels and the Greatest Banking Scandal of the Century (Macmillan)
Ya Libnan
09-04-2025
- Business
- Ya Libnan
Disgraced Ex-Central bank chief Riad Salameh referred for trial by a Lebanese judge
Riad Salameh who was once internationally seen as the guardian of Lebanon's financial stability, has fallen from grace long time ago . He spent his final weeks in office a wanted man, faced with French and German arrest warrants that have been prompted by long-running corruption is widely viewed as a key culprit in Lebanon's economic crash A Lebanese judge on Tuesday referred former central bank governor Riad Salameh to court for trial over the alleged embezzlement of $44 million of the bank's funds, a judicial official said. The move came seven months after Salameh was arrested in Lebanon over the case. Salameh, who headed the central bank for three decades, faces numerous accusations including embezzlement, money laundering and tax evasion in separate probes in crisis-hit Lebanon and abroad. On Tuesday, the judge issued a decision charging Salameh with embezzling '$44 million from the central bank', as well as illicit enrichment and forgery, the judicial official said, requesting anonymity as they were not authorised to brief the media. A request to release Salameh was rejected, along with a request to cancel arrest warrants issued in absentia for two of his alleged associates in the case, the official said. The trio were 'referred to the Beirut criminal court for trial', the official added. Salameh, who left office at the end of July 2023, has repeatedly said his wealth comes from private investment and his previous work at US investment firm Merrill Lynch. He is widely viewed as a key culprit in Lebanon's economic crash, which the World Bank has called one of the worst in recent history, but has defended his legacy, saying he is a 'scapegoat' for the crash. In May last year, Germany and France issued arrest warrants for Salameh over accusations including money laundering and fraud, though German prosecutors later cancelled their warrant, saying Salameh could no longer use his post to suppress evidence. In August last year, the United States announced coordinated sanctions with Canada and Britain against Salameh. Lebanon's new central bank governor Karim Souaid took office last week, pledging to advance key reforms demanded by international creditors to unlock bailout funds.
Al Arabiya
09-04-2025
- Business
- Al Arabiya
Lebanon's finance minister expects banking secrecy law to pass within days
Lebanon's Finance Minister Yassine Jaber told Reuters that he expected a banking secrecy law to be passed in parliament within days. Some Lebanese officials have accused former Central Bank Governor Riad Salameh of using bank secrecy laws to justify withholding information.
