U.S. Treasury Delegation Urged Lebanon To Increase Returns To Depositors

US Treasury Base

A senior delegation from the U.S. Department of the Treasury concluded on Wednesday a three-day visit to Lebanon.

The delegation met with Lebanese officials, members of the civil society, and the banking sector, as a “commitment to stand with the Lebanese people during this time of economic turmoil,” the Treasury said in a statement.

The delegation encouraged the Lebanese government to access reforms in order to have funds from the International Monetary Fund (IMF) program that “could help restore much-needed confidence in the economic system.”

The delegation also focused on the issues of corruption and lack of transparency and accountability in Lebanon, emphasizing that fighting corruption in Lebanon is essential to ease the economic crisis.

The delegation also asked the government and bank officials to “maximize the returns to Lebanese depositors, especially those with relatively smaller accounts, while emphasizing the need for swift action toward improving the financial system.”

They highlighted the abuses within the financial system, naming Al-Qard al-Hassan, and the “abuses” by the political and economic elite of the banking system.

They pointed to Al-Qard al-Hassan as “an unregulated, pseudo-financial institution” that abuses its NGO license to provide cover to Hezbollah’s financial activity, “jeopardizing the credibility of the Lebanese financial system.”

In regards to the interference in the banking system, the US Treasury emphasized the need for efforts to investigate financial abuses by the Banque du Liban and the Special Investigation Commission, and “perform due diligence on any related transactions.”

The U.S. delegation also discussed the upcoming MENA Financial Action Task Force (MENAFATF) to combat money laundering and financing of terrorism, improve compliance worldwide, work jointly to identify issues of regional nature, and share relevant experiences solutions for dealing with them.

The Treasury delegation also thanked the Lebanese government for its stance opposing the “unjustified, unprovoked, and premeditated invasion of Ukraine.”