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Anti-money laundering draft laws have to be ratified by Parliament before September, or else…

The Association of Banks in Lebanon (ABL) warned that Lebanon is at risk of being classified as a non-cooperative country in fighting money laundering.

“The ABL and Central Bank (BDL) have submitted some draft laws that are currently under study by parliamentary committees,” said ABL’s Chairman, François Bassil. “These draft laws should be ratified by Parliament before the meeting of the Groupe D’action Financière (GAFI), scheduled for next September, or Lebanon will be considered as a non-cooperative country in fighting money laundry,” he said.

Three draft laws are awaiting Parliament’s approval, after being ratified by the Government in 2012. The first is on the exchange of tax information, the second is on the transfer of funds across borders, and the third consists of amending Law No. 318/2001, which expands the term of anti-money laundering to include most financial crimes, including protection of intellectual property. It also expands declaration forms to include new professional sectors (notaries, lawyers, etc), in accordance with the GAFI criteria.

“We need to be strict in fighting money laundering to preserve our interests with correspondent banks,” said Bassil. “The global economy is dollarized. In Lebanon, 70 percent of deposits are in US dollars and all our financial operations conducted abroad are in this currency. Therefore, we have to apply the rules that protect our correspondents,” he said.

Lebanon has been keen in taking measures to fight money laundering. It created the Special Investigation Commission (SIC) in 2001,which investigates suspicious transactions, decides on the seriousness of evidence, and has the exclusive right to lift banking secrecy.

The Banking Control Commission of Lebanon (BCCL) has also been active in controlling banks’ activities. “The BCCL is highly committed to fighting money laundering,” said Samir Hammoud, Head of the BCCL. “We will be focusing more on enhancing the corporate governance culture inside banks,” he said.

Banks and financial institutions are doing their best to comply with the global Anti-Money Laundering and Countering Financing of Terrorism (AML/CFT) norms and standards.

“Banks are already well ahead of their global peers in applying AML/CTF procedures and requirements,” said Jean Riachi, Chairman of FFA Private Bank. “It is important to avoid any risks against our reputation,” he said.

GAFI is a Paris-based inter-governmental body, which aims to set standards and promote effective implementation of legal, regulatory and operational measures for combating money laundering, terrorist financing and other related threats to the integrity of the international financial system.