(Photo credit: Aziz Taher/AP)
A significant portion of millions in public funds embezzled by Lebanon’s Central Bank governor Riad Salameh is being held in several bank accounts in Switzerland.
“Twelve Swiss banks have received a large part of the money [Salameh] is alleged to have embezzled, estimated at up to $500 million,” Swiss daily SonntagsZeitung reported on 26 February.
The report adds that $250 million is being held in an HSBC subsidiary in the Swiss city of Geneva. Other amounts are with UBS, Credit Suisse, Julius Baer, EFG, and Pictet.
The transactions were “carried out using an offshore company registered in the British Virgin Islands,” the SonntagsZeitung report adds.
The offshore company in question is likely Forry Associates, a company owned by the brother of Lebanon’s central bank chief, Raja Salameh.
In February of last year, Reuters released a report revealing that Forry Associates concealed information regarding the recipients of commissions that were charged to commercial banks when they bought government securities.
Salameh and his associates then used these “considerable sums” of public funds to purchase real estate assets in several European countries.
In March last year, Salameh was charged with illicit enrichment by Lebanese Judge Ghada Aoun in relation to an apartment in Paris that the Central Bank leased as a “reserve center” in the event that the bank would no longer be able to operate from its headquarters in Beirut.
A raid on the apartment by French police in 2021 revealed that the Central Bank had rented it for $500,000 a year.
The Salameh brothers are also accused of using the money of Lebanese citizens to pay exorbitant rent for luxury apartments owned by the central bank chief and his close relatives in Paris, and to secure monthly stipends of 30,000 euros for Salameh’s girlfriend and daughter.
“Some of the funds have already been frozen, but federal prosecutors have not revealed how much,” SonntagsZeitung revealed.
According to the report, Switzerland’s federal market regulator FINMA has been undergoing preliminary investigations into the 12 Swiss banks “for months.” Legal action has also been taken against “two banks ‘in the Lebanese context,’” a spokesman said without elaborating further.
The Swiss report comes just a few days after Salameh, his brother Raja, and his assistant Marianne Hoayek were slapped with new corruption charges by a Lebanese court.
The charges come in the wake of a European judicial investigation launched in 2020 concerning his embezzlement of the funds.
In January, European investigators arrived in the country to continue the investigation. The team has since left but will return to Lebanon in early March to move forward with the probe, judicial sources have revealed.
As the shadow of this investigation looms over Salameh, the US-backed Central Bank chief has revealed that he is not seeking a new term after his current term ends later this year.