The dollar’s the boss

Lebanon first fell into the crosshairs of the United States Department of the Treasury’s Office of Foreign Assets Control (OFAC) in 2011. Pressure from OFAC — effectively the world’s anti-money laundering (AML) and counterterrorist financing (CTF) enforcer — saw one Lebanese bank go under for money laundering charges in the first quarter of 2011, and by the second quarter, Lebanese banks were having to deal with US-imposed sanctions on Syria. The heat did not let up in 2012, with the banking sector continuing to deal with the aftershocks and new regulations. The first shoe fell in February 2011, when OFAC labelled the Lebanese Canadian Bank (LCB) a “financial institution of prime money laundering concern” over transactions involving Hezbollah and drug dealers, with LCB’s assets later taken over by Société Générale de Banque au Liban. The US move was a harsh wake up call for the banks, with due diligence quickly