Exclusive - Counter-Terrorist Financing Laws to Cripple IRGC’s Regional Activities

Exclusive - Counter-Terrorist Financing Laws to Cripple IRGC’s Regional Activities

Saturday, 16 June, 2018 - 08:30
Lebanon’s Hezbollah members carry Hezbollah flags during the funeral of a fellow fighter in al-Ghaziyeh village, southern Lebanon May 26, 2015. REUTERS/Ali Hashisho
Berlin – Raghida Bahnam
On the morning of May 7th, 2008, Beirut residents woke up to the view of hundreds of Hezbollah fighters deployed in the streets with their military equipment and heavy weapons. It was the first time these militias were openly deployed in areas outside their strongholds. These images brought back to the memory the scenes of civil war in Lebanon. The main objective of the occupation of the capital was Beirut’s international airport.
 
Three days earlier, a surveillance camera was discovered on one of the runways of the airport. It was revealed that Hezbollah had installed it. Progressive Socialist Party leader Walid Jumblat called, in a press conference, for the expulsion of the Iranian ambassador from Lebanon and the suspension of Iranian Airlines flights, which he said were carrying arms shipments to Hezbollah. He also revealed a ground communications network set up by the party, in parallel with the State network.
 
This was followed by a long Cabinet meeting that resulted in two demands: the dismissal of the commander of the security apparatus of the airport, a request described by the militias as a “breach to the red lines,” and the dismantling of Hezbollah’s communications network and holding the party accountable. Hezbollah’s response came on May 7. The government withdrew its demands and the militias retreated to their former positions.
 
Beirut airport, or part of it, remained under the control of Hezbollah, and Iranian Airlines continued to operate in Beirut... a situation that continues to exist.
 
At Beirut airport today, there is a special gate that is outside the State control, known as the “Hezbollah gate”. There are planes unloading shipments that do not pass through customs or security, but are received by Hezbollah members directly. The port of Beirut has a similar crossing, where cargo is unloaded from ships without passing through customs or state security officials.
 
Tehran’s funding of Hezbollah is no secret. The group itself boasts that its money and armament comes from Iran. In 2006, after the Israeli war, the party received cash shipments through Beirut airport coming from the Iranian Embassy in Damascus. According to well-informed sources, the embassy has been for years the center for the transfer of funds through diplomatic missions.
 
In Iraq, the picture is not very different. Informed tribal sources told Asharq Al-Awsat that the Iranians control the airports of Baghdad, Suleimaniyeh and Najaf through their militias and groups.

In Syria, the war turned into a profitable trade for Iran in the fields of oil, arms and drugs, from which it finances its operations in Syrian territory.
 
Iran has tried in recent years to circumvent the sanctions imposed on its banking sector by establishing small Iranian banks in Lebanon, Iraq and other countries used for money laundering and financing their groups. “The Iranian banks in Lebanon are registered as Lebanese companies,” senior banking sources in Beirut told Asharq Al-Awsat. “They do not send remittances abroad; they keep money inside Lebanon.”
 
Banking sources say it is “difficult” to trace the source of funds, adding the party relies on transfers by aliases or on people who are not blacklisted.
 
Other well-informed sources talk about huge pressure being exerted on Lebanese banks by the US Treasury to close the accounts of Hezbollah members and financiers.
 
A senior Lebanese banker said that when the US Treasury laws were passed to put Hezbollah on the list of terrorist organizations, “many banks were panic-stricken and began to close accounts randomly because Lebanon’s Central Bank (BDL) was asked to abide by the laws. But this has caused great chaos.”
 
Other sources say that Lebanese banks “turn a blind eye” on many suspicious accounts. One reason is that those suspicious persons are turning into big depositors at a time when thee banks need such deposits amid a decline in investments and downturns in the real estate market.
 
The sources say that Hezbollah “sends drug trucks abroad via land and through networks in Syria and neighboring countries, and the same trucks return loaded with cash.”
 
In this regard, Lebanese Journalist Fidaa Itani says that Hezbollah’s annual budget exceeds $900 million, including salaries of more than 100,000 people, and that most of this funding comes from Iran. But the party collects a large portion of it from the zakat imposed on its supporters in Africa, Europe and America, in addition to a large network of donations woven from its supporters in the world.
 
Banking sources talk about “tactics” adopted by some “traders” in Africa to smuggle cash to Hezbollah in Lebanon and say they are circumventing African laws that do not allow the transfer of large sums by establishing shell companies in several countries in Europe and Lebanon, through which financial transactions are conducted while services are provided in African countries.
 
Shiite opposition journalist Ali al-Amin notes that even if Hezbollah could raise funds independently of Iran, “Tehran cannot accept the party’s independence.”
 
According to informed sources, Hezbollah funds coming from sources outside Iran are managed by the Iranian Revolutionary Guard.
 
In Iraq, the situation is not any better. Several sources speak of Iran’s “infiltration” into Iraq’s political fabric. According to sources, Tehran is financing the Popular Mobilization Forces from Iraqi oil money.
 
Sources close to the Iraqi prime minister said that Iran has succeeded in consolidating its presence in the country and is now controlling several key institutions.
 
Tribal sources say that senior Iraqi officials are involved in dealings with Iran. The sources talk about the transfer of advanced Iranian weapons through airports with the support of Iraqi officials.
 
In addition to Lebanon and Iraq, Iran has backed the Assad regime in Syria for years, and well-informed sources say the Revolutionary Guard is financing its war in Syria from “trade” there.
 
Senior oil sources in Washington say that the only effective way to prevent Iran from funding its own groups is to weaken its oil production, which is the pillar of Iran’s economy and generates more than 90 percent of state revenues.
 
These sources add that direct sanctions on oil are not possible because of international laws, but they talk about indirect laws such as pressure on companies that maintain oil fields.
 
Iran is now under considerable pressure from a much-unknown organization but one of the world’s most powerful and only organizations to combat money laundering related to terrorist financing.
 
This organization is called the Financial Action Task Force (FATF), which is based in Paris. It was established in 1989 at the initiative of the Group of Seven to combat money laundering. In 2001, after the September 11 attacks, its mission was expanded to include or focus on the fight against money laundering linked to terrorism.
 
The organization issues recommendations to states to translate them into binding anti-money laundering laws. Non-complying or non-cooperative states are placed on a blacklist and are considered "dangerous".
 
Since 2012, Iran topped the blacklist along with North Korea. In 2015, after the nuclear agreement with Iran, FATF suspended countermeasures to give it an opportunity to introduce anti-money-laundering reforms, but kept the country on the blacklist.
 
Prior to the FATF meeting last February, a group of US lawmakers and diplomats sent a letter to the organization asking it to reinstate countermeasures against Iran.
 
Before the next meeting, experts in the Iranian file expect additional US pressure on FATF to reinstate the countermeasures.
 
“The United States will certainly seek to reinstate countermeasures in order to increase the impact of the sanctions it has imposed on Iran,” said Ali Faiz, director of the Iran program at the International Crisis Group in Washington.
 
But Faiz notes that replacing the countermeasures means that the Europeans’ attempt to save the nuclear agreement will vanish.

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