Lebanon’s Central Bank chief charged with money laundering

A Lebanese judge charged veteran Central Bank Governor Riad Salameh and his brother with illegal enrichment and money laundering, an official in the judiciary said Monday.

Mount Lebanon Prosecutor Ghada Aoun accused Salameh, his wife and his brother, Raja, of facilitating money laundering through companies they own, the official said, asking not to be named discussing the charges. 76Aoun referred the case to an investigative judge.

Raja Salameh was detained last week and accused of embezzlement and money laundering during a hearing with Judge Aoun. The Salameh brothers deny the allegations against them. The central bank governor didn’t attend a hearing scheduled for Monday.

The central bank didn’t respond to a request for comment. Raja Salameh’s lawyer, Marwan Issa El-Khoury, didn’t immediately answer calls to his phone.

The charges are part of a lawsuit filed last week by a group of lawyers. One of the group, Francoise Kamel, said the brothers were accused of money laundering and embezzling public funds at the central bank during Lebanon’s worst ever financial crisis in favour of companies belonging to the Salameh family.

Riad Salameh is also under investigation in France and Switzerland, raising pressure on the veteran banker who’s been at the helm of the central bank, also known as Banque du Liban, for 29 years.

Swiss authorities are looking into allegations that Riad Salameh indirectly benefited from the sale of Lebanese Eurobonds held in the central bank’s portfolio, Bloomberg reported in early 2021. Also of interest to authorities is the relationship between Raja Salameh and the brokerage firm Forry Associates Ltd., which charged commissions on the sale of Eurobonds to investors.

Riad Salameh has denied allegations in the Swiss investigation and has said that such cases, including those in Lebanon, are part of a media campaign to tarnish his image. He says he amassed his fortune during a previous career as a private banker at Merrill Lynch.

A household name on Wall Street and in foreign capitals, Salameh has been one of the few constants over the past three decades as Beirut wrestled with war, debilitating political standoffs and an economic meltdown.

That backdrop sparked mass protests in October 2019 against a political class accused of bleeding state coffers through decades of corruption and mismanagement. Demonstrators also blamed Salameh for ever-riskier policies to sustain a financial model that ultimately failed, wiping out the life savings of a generation of Lebanese.