U.S. Treasury Designates Lebanese Canadian Bank Sal as a “Primary Money Laundering Concern”

The U.S. Treasury Department says the Lebanese Canadian Bank SAL together with its subsidiaries (LCB) has laundered hundreds of millions of dollars for a drug trafficking group with ties to Hezbollah, which Washington considers a terrorist organization.

The Treasury Department and the Drug Enforcement Administration say Lebanese Canadian Bank SAL has been designated a “primary money laundering concern” for allegedly helping launder up to $200 million a month for a Lebanese-based drug smuggling group. The agencies say alleged drug kingpin Ayman Joumaa runs the ring.

LCB has been designated under Section 311 of the USA Patriot Act. Section 311 actions are distinct from designations brought by Treasury’s Office of Foreign Assets Control (OFAC), which are applied more broadly, prohibit transactions and trigger asset freezing obligations. For an overview of Section 311 of the USA Patriot Act, please click here.

Allegedly, Joumaa and his Lebanon-based drug trafficking and money laundering network, along with several other individuals, have used LCB to launder narcotics proceeds as part of this international money laundering network. On January 26, Treasury designated Joumaa along with nine individuals and 19 entities in his network as Specially Designated Narcotics Traffickers pursuant to the Foreign Narcotics Kingpin Designation Act (Kingpin Act). Following today’s action by the Treasury, more individuals may soon face an OFAC SDN designation.

The Treasury’s Financial Crimes Enforcement Network (FinCEN) also today filed a Notice of Proposed Rule Making (NPRM), in which it proposes prohibiting U.S. financial institutions from opening or maintaining correspondent or payable-through accounts for LCB.

For a complete reading of the Treasury press release, please click here.

Douglas McNabb and other members of the firm practice and write extensively on matters involving Federal Criminal Defense, INTERPOL Litigation, International Extradition and OFAC SDN Litigation.

The author of this blog is Douglas McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.

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