Lebanon presses charges against former central bank governor Riad Salameh

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The Lebanese judiciary has pressed charges of financial crimes against former central bank governor Riad Salameh, a judiciary source and state media announced on Wednesday.
“The public financial prosecutor, Judge Ali Ibrahim, pressed charges against the former Governor of the Central Bank of Lebanon, Riad Salameh, for offenses of embezzlement, public funds’ theft, forgery, and illicit enrichment,” said the state-run National News Agency.
It comes after his arrest by Public Prosecutor Judge Jamal Hajjar on Tuesday following a judicial hearing in Beirut in relation to an investigation into a massive fraud scheme in which tens of millions of dollars in public funds were allegedly embezzled from Lebanon’s central bank. The alleged swindle is known as the Optimum case.
Mr Hajjar ordered a four-day preventive detention. Mr Salameh, once seen as the guardian of Lebanon’s financial sector, is now an international fugitive with frozen assets worth millions of dollars, an Interpol notice against him and several judicial cases both domestically and internationally. He is also widely blamed for Lebanon’s financial collapse.
The case is now in the hands of an investigating judge to confirm the facts, gather evidence, then send them to the chamber of indictment before a potential trial.
The arrangement between Optimum Invest SA and the Banque Du Liban (BDL) is alleged to have allowed massive losses at the bank to be concealed between 2015 and 2018. The Lebanese judiciary also suspects that some of the money shuffled between accounts at the BDL was actually embezzled.
The Associated Press reported that the Lebanese judiciary is looking into embezzlement of $42 million.
BDL’s forensic audit, conducted by consulting firm Alvarez & Marsal (A&M), suggested that at least $111 million might have been siphoned off as shady disbursement to undisclosed third parties through the deals with Optimum. It is not known where the money went.
It is unclear why the judiciary is investigating only part of the amount flagged by the audit.
This is a different case from the widely reported Forry Associates Ltd scandal, which involves another brokerage company under investigation domestically and internationally.
Optimum commissions are suspected to be a continuation of the Forry commission’s scheme, another broker under investigation in Europe allegedly used by Mr Salameh to embezzle $330 million from the BDL between 2002 and 2015.
In Lebanon, the case has been stalled for years by political interventions despite the mounting international pressure.