Latest news with #AlQardAlHasan
LBCI
16-07-2025
- Business
- LBCI
For first time, Lebanon names Al-Qard Al-Hasan in official banking ban—the details
Report by Lara El Hachem, English adaptation by Mariella Succar For the first time, Lebanon's central bank has issued a circular explicitly naming the Hezbollah-linked Al-Qard Al-Hasan Association, prohibiting banks and financial institutions from dealing with it. While the U.S. Treasury Department has long sanctioned individuals connected to Hezbollah and Al-Qard Al-Hasan—most recently in early July—this is the first official directive from Lebanese authorities directly targeting the group by name. Legal sources at the central bank told local media the move marks a shift from previous circulars, which had only warned against dealing with unlicensed financial institutions in general terms. According to those sources, the circular aims to protect the banking sector from potential sanctions and send a clear message that Lebanon is serious about combating money laundering. Al-Qard Al-Hasan has been on the U.S. sanctions list since 2007. The directive comes amid growing concern over the vulnerability of Lebanese banks to international scrutiny. For example, if a customer receives a cash loan from Al-Qard Al-Hasan and uses it to purchase a car, the transaction might initially appear routine. However, if the car dealer deposits the funds into a bank and authorities trace the source to Al-Qard Al-Hasan, both the individual and the bank could face serious consequences, including the risk of losing access to correspondent banking services. The loss of correspondent relationships would effectively isolate Lebanese banks from the global financial system, halting money transfers and international trade. Only two correspondent banks still deal with Lebanon, largely due to concerns over the country's inclusion on the Financial Action Task Force's "gray list" for insufficient compliance with anti-money laundering and counter-terrorism financing standards. Financial and banking experts say the latest circular came as no surprise, as most Lebanese banks had already ceased dealings with Al-Qard Al-Hasan to avoid risk.
The National
15-07-2025
- Business
- The National
Lebanon banks banned from dealing with Hezbollah's financial networks
Lebanon 's banks have been banned from dealing with financial networks linked to Hezbollah, according to a document seen by The National. The Hezbollah-affiliated institutions include Al-Qard Al-Hasan Association, which has been providing compensation to residents affected by the latest war with Israel. Others are Tashilat SARL, Yousser Company and Bayt al-Mal. The decision, made by Lebanon's Central Bank, comes as Hezbollah, once a formidable militia and influential political party in Lebanon, is weakened significantly by months of conflict with Israel that destroyed much of its leadership and arsenal. Hezbollah is now under unprecedented pressure to disarm after the war ended in a November ceasefire brokered by the US and France. Its disarmament, once a taboo, is now on the table. US special envoy Thomas Barrack said in a post on X on Tuesday that the ban was a 'step in the right direction'. Mr Barrack visited Beirut last week, where was handed Lebanon's reply to a US plan aimed at disarming Hezbollah. According to a central bank circular, all financial institutions licensed by it - as well as brokers - are banned from conducting any transactions, directly or indirectly, with institutions including Al Qard Al Hassan. Failure to comply with the decision could result in legal action, such as suspension or revocation of licences, freezing of accounts and assets, or referral to the Special Investigation Commission, the memo said. All the financial companies cited in the document are under US sanctions, accused of providing financial support to Hezbollah's network. Tashilat SARL was the latest to be added to the US Treasury's sanctions list in early July. The organisation and seven senior officials were listed over their association with Al Qard Al Hassan. Last year, the Financial Action Task Force (FATF) added Lebanon to its "grey list" of jurisdictions under enhanced scrutiny. Founded in 1983 and registered as a non-governmental organisation in Lebanon, Al Qard Al Hassan has grown to become the country's largest microcredit provider, particularly serving the Shiite community. Before the war, it was running more than 30 branches across Lebanon, including 15 in Beirut and its suburbs. Israel destroyed and damaged several of its branches during last year's conflict with Hezbollah. Lebanese banker Jean Riachi told The National that nothing has changed for the banks. 'Banks, in principle, do not work with sanctioned entities,' he said. 'There's certainly a symbolic element to naming Al Qard Al Hassan directly. It's unusual to single out a specific entity in a central bank circular, that's generally not done." He explained that previous circulars did not explicitly ban institutions other than banks, such as money transfer agencies and e-payment platforms, from dealing with Al Qard Al Hassan and linked agencies. 'Banks already avoided these entities under the cover of compliance requirements from foreign correspondent banks,' Mr Riachi said. "But these entities don't have correspondents abroad anyway, so technically they weren't affected." He added that the move was a positive step towards improving compliance, while not addressing the core of the issue, that these Hezbollah-affiliated institutions are not licensed with Lebanon's Central Bank. 'It's a good step but no one has dared to go further and declare what they're doing as illegal. Because technically, to operate as a bank, you need a licence from the Central Bank of Lebanon. They're not doing it, it's still a highly political issue."
