Around US$1.3 billion of letters of credit (L/Cs) appear to have been used in suspicious hard currency transfers from accounts in Lebanon to several banks in Switzerland according to officials investigating reports that Lebanese politicians transferred billions of US dollars to foreign banks in 2019.

The reports have angered many Lebanese because since October, banks have imposed tight controls to prevent capital flight and blocked most transfers abroad.

Lebanon is facing an acute dollar shortage and deteriorating economic conditions, prompting a popular uprising against the county's ruling class.

CCID investigations

The Central Criminal Investigation Department (CCID) began investigations in December after high profile economist Marwan Iskandar said a Swiss official had told him that nine Lebanese politicians had transferred billions of US dollars abroad.

Beirut First Examining Magistrate Ghassan Oueidat, who is heading the CCID's investigations, now says he has a letter from the Banking Control Commission of Lebanon (BBCL) stating that US$2.276 billion have been transferred from depositor accounts in Lebanon to several Swiss banks.

Extensive L/C use

"BBCL noted that around 60 per cent of the transfers are in the forms of letters of credit," Oueidat told the Asharq Al-Awsat newspaper.

Oueidat added that he had asked the Special Investigation Commission on fighting money laundering at the central bank to investigate the matter further.

This article represents the views of the author and not necessarily those of the ICC or Coastline Solutions.