Lebanon’s central bank to commit to audit as Macron urged to freeze ‘doubtful’ assets

BEIRUT: Lebanon’s finance ministry said the central bank agreed on Tuesday to provide by the end of the month the documents required by Alvarez & Marsal for a stalled forensic audit.
The audit, which hit a roadblock last year, is a key condition for foreign aid that Lebanon badly needs as it grapples with a financial collapse rooted in decades of waste and graft. The currency has crashed and banks are paralyzed.
When restructuring consultancy A&M withdrew from the audit last November, it said it had not received the information it needed from Lebanon’s central bank.
Parliament agreed in December to lift banking secrecy for one year, amid much back-and-forth between Lebanese officials including the ministry and the central bank over whether certain information could be disclosed.
After a meeting with the central bank and A&M on Tuesday, the finance ministry said the bank confirmed its commitment to an audit and to deadlines to provide the necessary documents. It said attendees would stay in contact “in order to re-activate the forensic audit and evaluate the current development.”
There was no immediate comment from the central bank or A&M.
French President Emmanuel Macron should freeze suspect assets held by Lebanese officials in France to break a “political-economic mafia” that has plunged Lebanon into crisis and misery, an open letter said Tuesday.
Macron called for radical reform in Lebanon after a deadly Beirut port blast and has expressed exasperation at the lack of change, as the former French mandate territory remains mired in political stalemate.
Analysts have said that sanctions such as asset freezes could be the most effective lever for Paris to pressure Beirut, even if France has so far not explicitly indicated it is ready for such a measure.
Macron should issue instructions “with a view to implementing the legal mechanism for freezing assets of doubtful origin held in France by Lebanese political and economic leaders,” said the letter published in France’s Le Monde daily signed by more than 100 Lebanese civil society figures.
It said that a “political-economic mafia is responsible for the misery, hunger and insecurity from which more and more Lebanese suffer.”
The letter suggested that such a legal process should draw on the precedent set over ill-gotten assets owned in France by some African leaders and former Syrian vice president Rifaat Assad.
“This endemic corruption on a grand scale has scandalously enriched Lebanese political leaders” by emptying the treasury and embezzling aid sent after the civil war, the letter alleged.
It was signed by lawyers, doctors, journalists and activists, including prominent political scientist Karim Emile Bitar, former Lebanese culture minister and UN Libya envoy Ghassan Salame and former MP and TV host Paula Yacoubian.
The letter was drafted after French Foreign Minister Jean-Yves Le Drian said in March that “the time has come” to raise international pressure on Lebanon to form a government.
Lebanon’s prime minister-designate Saad Hariri and President Michel Aoun again failed last month to agree on a new government cabinet after months of deadlock, as the country sinks deeper into economic crisis.
A steep depreciation of the Lebanese pound along with an explosion of poverty and unemployment have eroded purchasing power and fueled anger among the population.
The outgoing government of premier Hassan Diab resigned in the wake of an August 4 explosion at Beirut’s port that killed more than 200 people and sparked protests against the entrenched ruling class.
(With Reuters and AFP)

Lebanon’s central bank to commit to audit as Macron urged to freeze ‘doubtful’ assets