US Treasury imposes sanctions on Lebanese businessmen and member of parliament

The United States Treasury imposed on Thursday sanctions on two top Lebanese contractors, alongside a lawmaker with close ties to Hezbollah, over alleged corruption charges that undermined the rule of law within the country.

The two contractors are businessmen Jihad Al-Arab and Dany Khoury, who hold close ties to former Lebanese Prime Minister Saad al-Hariri and Christian MP Gebran Bassil respectively. They were sanctioned for “alleged corruption related to state contracts.”

This is the first time the Treasury imposes sanctions on a close associate of Hariri, when it has normally targeted those with close affiliations to Hezbollah and its allies.

In 2020, Bassil, former finance minister Ali Hasan Khalil, and former public works minister Youssef Fenianos were sanctioned due to alleged corruption and material support for Hezboallah.

As per the Treasury, Khoury and Arab have allegedly received state contracts worth hundreds of millions of dollars for work such as “garbage collection” and “disposal work.”

In particular, Khoury was granted a 142 million dollar contract to operate a coastal landfill. The landfill has previously received accusations of dumping toxic waste into the sea, while also failing to remedy a garbage crisis that has plagued the country for around six years now.

Al-Arab “served as an intermediary as of 2014 to broker a meeting between Lebanese top officials in advance of the Lebanese presidential election, in exchange for two government contracts valued at approximately $200 million.”

“He is not my partner in politics, nor am I a partner in business,” said Gebran Bassil in response to allegations by the Treasury that Khoury had benefited from having a relationship with him.

Lawmaker Jamil Sayyed, in contrast, was sanctioned for seeking “to skirt domestic banking policies and regulations” by attempting to transfer $120 million abroad, at a time when Lebanese citizens are barely able to withdraw their funds from banks due to the implementation of illegal capital controls. 

The Treasury statement found that Sayyed’s actions were done to “presumably to enrich himself and his associates.”

On Twitter, US Secretary of State Anthony Blinken said the new sanctions are “an important step in promoting accountability in Lebanon”, as it seems the US is making a move to target the Lebanese political class in its entirety.

“Lebanese officials must end corruption and take urgent action to address the crises the Lebanese people face,” he added.

On Friday, Sayyed responded by saying that the US is “a party trying to attack Lebanon’s sovereignty”, challenging the Treasury to provide him with an entry visa so that he may prove himself in person. He added that “if they find $120 million in any pod in the world, he would use the funds to finance the previous government’s newly instated ration card with $60 million and give the other $60 million to the people of Baalbeck-Hermel.”

As of now, 74 percent of the population currently resides beneath the poverty line.