Restrictions on Money Transfers in Lebanon Amid US Pressure to Cut Hezbollah Funding

SadaNews - The Central Bank of Lebanon today, Friday, imposed new restrictions on financial transactions through non-bank institutions as part of its efforts to combat money laundering and prevent illegal transfers, amid pressures from Washington to dry up Hezbollah's funding sources and strip it of its weapons.

The announcement of precautionary measures came just days after an American delegation visited Beirut, including officials from the U.S. Treasury, who urged the authorities to cut off Hezbollah's funding sources from its Iranian backers, estimating the transfer of over one billion dollars since the beginning of the year, mostly through money exchange companies.

The Central Bank announced the imposition of "preventive measures" that affect the work of "all non-bank financial institutions licensed by the Central Bank, including money transfer companies, exchange companies, and other entities engaged in cash transactions in foreign currencies and transferring them to and from Lebanon."

Starting from the beginning of next month, those institutions are required, according to a circular from the Central Bank, to "collect information and data related to their clients and operations" when "conducting any cash transaction equal to or exceeding the amount of one thousand US dollars, or its equivalent, for a single transaction," and send it to the Central Bank within a maximum of two days from the date of the transaction.

The aim of these measures is to "prevent the transfer of illicit or illegally obtained money through these institutions, in line with international standards on combating money laundering and terrorist financing, and to prevent the misuse of the licensed financial system for suspicious operations."

The Central Bank placed these measures within the framework of "working to remove Lebanon from the gray list of the Financial Action Task Force" and to "enhance the compliance environment within the financial sector."

The group had officially placed Lebanon on its gray list in October 2024 due to what it described as "weak measures taken by the Lebanese government in combating money laundering and terrorist financing."

Last week, the U.S. Treasury imposed sanctions on three individuals from Hezbollah, accusing them of "facilitating the transfer of tens of millions of dollars from Iran to Hezbollah in 2025."

US Treasury Under Secretary for Terrorism and Financial Intelligence, John Hurley, said in Beirut on Monday that much of the money transfer is done in cash and through gold, with some done through cryptocurrencies, emphasizing his country's determination to "end Iran's malign influence" through Hezbollah.

Hezbollah's parliamentary bloc condemned in a statement on Thursday "the American efforts to tighten the financial siege on Lebanon," describing it as "condemnable and rejected efforts that come as part of imposing financial guardianship" on the country.

Hezbollah, which operates financial, educational, and economic institutions, emerged weakened from the last war it fought with Israel, which ended in a ceasefire a year ago that stipulated the dismantling of its military structure near the borders and restricting weapons in the hands of legitimate forces.

Lebanon has been experiencing an economic crisis since the fall of 2019, which has weighed heavily on the banking sector, leading to strict restrictions on cash withdrawals and transfers.

This has resulted in the resurgence of financial operations outside the banking system, particularly through money exchange companies and money transfer institutions.