A Lebanese bank accused of being at the center of global money-laundering schemes tied to the militant group Hezbollah has agreed to pay a $102m settlement, US prosecutors in New York said Tuesday.
According to Reuters, the settlement would resolve a 2011 lawsuit that accused Lebanese Canadian Bank of using the US banking system to launder drug-trafficking profits through West Africa back to Lebanon.
“Today’s settlement shows that banks laundering money for terrorists and narco-traffickers will face consequences for their actions, wherever they may be located,” U.S. Attorney Preet Bharara said in a statement.
Most of the bank’s assets were acquired by the Lebanese subsidiary of France’s Societe Generale after the US Treasury Department designated Lebanese Canadian Bank as a “primary money-laundering concern” in February 2012.
The $102m would come out of $150m previously seized in August 2012 by the US government, the Justice Department said.
The Societe Generale subsidiary, Societe Generale de Banque au Liban, would receive the other $48m. Lebanese Canadian Bank would pay another $12m to Societe Generale, the Justice Department said.
Evan Barr, a lawyer for Lebanese Canadian Bank, said the settlement “certainly resolves (the case) for our client.” He said the bank is in liquidation in Lebanon following its $580m purchase by Societe Generale.
Mike Sullivan, a lawyer for Societe Generale, said in an email the bank was pleased the seized funds would be released and that its $90m claim had been “favorably resolved.”
The US Justice Department sued the bank in December 2011 alleging a massive scheme involving two exchange houses linked to Hezbollah, which the US lists as a terrorist organization.
Prosecutors alleged that from January 2007 to early 2011, the bank and other financial institutions transferred at least $329m to the United States to buy cars subsequently sent to West Africa.
Prosecutors said Lebanese Canadian Bank played a key role in laundering the proceeds of those car sales and profits from narcotics trafficking, enabling the money to arrive back in Lebanon. The lawsuit sought a $230m from the bank.
