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Feds Grab $150 Million Tied to Hezbollah Money-Laundering

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Aug. 20 (Bloomberg) -- The U.S. seized $150 million in connection with a Hezbollah-related money laundering scheme that involved the defunct Lebanese Canadian Bank, the U.S. Attorney’s office in Manhattan said.

The funds came from a U.S.-based account of Beirut-based Banque Libano Francaise SAL, which is holding money in escrow from the $580 million sale of the defunct Lebanese Canadian Bank to Societe Generale de Banque au Liban, prosecutors said in a statement.

Lebanese Canadian Bank, based in Beirut, was accused by federal prosecutors in December of helping launder at least $329 million for the Hezbollah, designated as a terrorist organization by the U.S. State Department, in a scheme that involved buying and selling used cars. Cash from the car sales as well as proceeds of narcotics trafficking were funneled to Lebanon through the scheme, the U.S. alleged.

“Money is the lifeblood of terrorist and narcotics organizations, and while banks which launder money for terrorists and narco-traffickers may be located abroad, today’s announcement demonstrates that those banks and their assets are not beyond our reach,” said Manhattan U.S. Attorney Preet Bharara in a statement.

Societe Generale de Banque au Liban, based in Beirut, and Banque Libano Francaise SAL are not accused of any wrongdoing, prosecutors said.

The case is U.S. v. Lebanese Canadian Bank SAL, U.S. District Court, Southern District of New York (Manhattan).

To contact the reporter on this story: Christie Smythe in New York at csmythe1@bloomberg.net; Patricia Hurtado in New York at pathurtado@bloomberg.net.

To contact the editor responsible for this story: Andrew Dunn at adunn8@bloomberg.net

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