Financial Crime Watchlist Set to Include Lebanon in Greylist This Week

On Monday, 21 October 2024, a confidential report involving four individuals stated that Lebanon is expected to be added to the FATF’s grey list at the end of the current week, despite requests from Lebanese authorities for flexibility in the decision.

Governor of the Central Bank, “Wassim Mansouri,” stated in August about his efforts and commitment to keep Lebanon away from placing in the grey list of the “Financial Action Task Force (FATF),” which will negatively impact the economy of the country.  Foreign investment will be restricted upon greylisting.

Reason for Grey Listing

Despite serious warnings, Lebanon has not shown improvements in measures to combat financial crimes such as money laundering (ML).  As a result, Lebanon is expected to be placed on the grey list, as announced in the FATF’s plenary in Paris on Friday, state sources.

According to information from four anonymous sources who were not permitted to speak publicly about the situation, Lebanon will be given additional time by the FATF to make the requested changes.

However, the decision regarding Lebanon’s greylisting is final and will not be changed.

Financial Crisis and Regional Tensions

Since 2019, Lebanon has been facing challenges in the economic field, experiencing further destruction due to “expanding Israeli military operation against armed group Hezbollah.”

According to a statement made last week by “Ex economy minister and former vice governor of the central bank,” Nasser Saidi, the damage caused by the bombing operation of Israel will require approximately “$25 billion” for recovery.

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Previous Warnings and Areas of Concern

In May 2023, Lebanon was warned about related greylisting in a “preliminary evaluation.” It has a whole year to close the loopholes in specific areas such as “anti-money laundering measures, transparency on beneficial ownership of firms and legal assistance in asset freezing and confiscation.”

As per media sources, Mansouri is currently in the U.S. to attend the annual “meetings of the International Monetary Fund and World Bank” in the first half of the week before going to Paris for the FATF plenary at the end of the week.