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The Mount Lebanon Appeal Prosecutor (center), Judge Ghada Aoun, on Thursday, January 28, 2021, accused the Governor of the Central Bank of Lebanon, Riad Salameh, and a central bank official, of the crime of “negligence and labor abuse of confidence “in the process of managing the subsidized dollar, according to a judicial source told Agence France-Presse.
In light of the prolonged economic collapse since 2019, the lira lost almost eighty per cent of its value against the dollar on the black market, while the official rate remains fixed at 1,507 pounds, causing an insane rise in prices of imported materials. , especially food.
In an attempt to reduce high prices in a country where more than half of the population lives below the poverty line, the Banque du Liban approved in May a mechanism by which the dollar subsidized, that is, according to a rate exchange rate of 3,900 pounds It will be provided to support the importation of basic foods and raw materials for their manufacture.
The judicial source said that Aoun had accused Salameh and Maya Dabbagh, head of the Banking Control Commission, for the crime of “labor negligence and breach of trust.” He also denounced Michel Maktak, owner of a prominent company that imports dollars from abroad, and the cashier Abd al-Rahman al-Fayed, for violating an administrative decision. He referred them all to the first coroner in Mount Lebanon, Judge Nicolas Mansour, for questioning.
He explained that the allegation “is based on data indicating that the subsidized dollar exchange process did not go all the way in the specified direction”, that is, by subsidizing the importation of basic foods.
He said that the value of “the sums that went into the pockets of money changers and financial institutions exceeded five million dollars” at a time when Lebanon was under the weight of its worst economic crisis.
Salameh, who for years had been considered the godfather of pound stability, is facing mounting pressure. Lebanon’s political parties hold him responsible for the collapse of the national currency and harshly criticize the monetary policies he adopted as they accumulated debts. However, Salameh has repeatedly defended himself, saying that the Central Bank “financed the state but did not spend the money.”
Last week, the Lebanese judiciary received a letter from the Swiss judiciary, requesting assistance in a criminal investigation it is conducting regarding the money transfers from Lebanon.
According to a Lebanese judicial source, the correspondence involved transfers of 400 million dollars belonging to Salama, his brother and his assistant, and institutions affiliated to the Central Bank, including Middle East Airlines and Lebanon Casino.
However, the Federal Public Ministry in Switzerland clarified that his request is related to “an investigation into money laundering … related to a possible embezzlement of funds from the Central Bank of Lebanon”, without mentioning the names of the suspects.
For his part, Salameh reiterated that “no transfers were made from the accounts of the Banque du Liban or from its budgets.”
Analysts and observers accuse political leaders and officials, including Salameh, of transferring large sums of their accounts abroad, following the unprecedented popular demonstrations that began in October 2019 against the political class, despite the imposition of strict banking restrictions that prevent financial transfers abroad.
