Banks

Great Britain denounces the measures to close the accounts of British nationals by the Lebanese Banks

The British Embassy in Lebanon issued a statement denouncing the closure by Lebanese banks of bank accounts belonging to British nationals.

This information follows a judgment published by a London court, obliging Banque Audi and Société Générale de Banque au Liban (SGBL) to transfer the sum of 4 million dollars abroad to one of their account holders. who has residence in the UK.

In retaliation for the legal risk and the risk of being removed from the international financial system, the Lebanese banks have decided to unilaterally close the accounts of British nationals or residents of Great Britain, by depositing the balance of these accounts in bank check with a notary and not to transfer these sums abroad.

The British Embassy in Lebanon believes that “this unilateral action by the banks has singled out account holders on the basis of their British residence or nationality, which appears to be targeted and discriminatory”, before prosecuting for note that these measures constitute possible violations of the relevant banking laws and regulations and expresses its concerns to the Lebanese political, but also financial and banking authorities.

The British Ambassador to Lebanon, Ian Collard, thus successively met with the Union of Depositors, the President of the Association of Banks in Lebanon, senior representatives of certain banking institutions, the President of the Banking Control Commission, the Governor of the Central Bank and the Prime Minister of Lebanon. It calls for all depositors to be “treated properly and fairly”.

The diplomat believes that “this unfortunate situation is symptomatic of Lebanon’s failing economy”.

“Since the onset of the economic crisis, the UK has joined its international partners in calling on the Lebanese government to enact much-needed and essential economic reforms. Without such reforms, the Lebanese economy will continue its free fall, with serious repercussions for all bank depositors in Lebanon, as well as Lebanese citizens in general and others residing in Lebanon,” the statement continued.

The English diplomatic representation provides its nationals on its website with a list of English-speaking legal representatives in Lebanon.

On the Lebanese side, the chairman of the Banking Commission and the governor of the Central Bank Riad Salamé, who has since been charged with embezzlement, assure that “measures are actively being considered to appropriately protect all the depositors concerned”.

Several local banks are also the subject of complaints in the United States, Great Britain or Europe.

Banque Saradar has already been ordered to pay 2.8 million dollars by a French court while SGBL had reimbursed following an amicable procedure the sum of 20 million dollars after a French court of justice had frozen the assets of the establishment and its directors in France.

The 9th chamber of the Paris Judicial Court also decided on November 19 to reimburse all the sums deposited – equivalent to 2.5 million euros – by a Syrian national who has been resident in France for 45 years by Banque Saradar, failing which the assets of the establishments in France could be seized.

Thus, if the normal procedure in relation to the refusal of Lebanese banks to honor these bank checks whether locally or abroad is confirmed, an appeal should be presented to the central bank, the supervisory body of this sector.

Although he is also the subject of several legal investigations opened against him, the governor of the Banque du Liban Riad Salamé is known for his closeness to the interests of Lebanese banks.

Thus, until now, the Governor of the Banque du Liban has taken no coercive measures against Lebanese banks, which has led several depositors to favor procedures abroad and not locally.

Faced with these risks, local legislators want to adopt new texts offering immunity to local banks and their managers. However, this immunity could not be retained abroad, leading to a possible seizure of the assets of the bank and even of their leaders, some of whom – 6 establishments in this case – are also accused of having embezzled large sums and participated money laundering with the Governor of the Banque du Liban in the context of the Forry Associates case.

Moreover, this refusal by Lebanese banks – already considered to be in a state of selective default by the rating agencies since the introduction of informal capital controls in November 2019 – to transfer these depositors’ funds could definitively induce a state of default. payment of the latter and thus cut Lebanon off from the international financial system which will cease all contact with them, including with the Banque du Liban, leading the Land of the Cedars to an exacerbation of the financial crisis it is going through, an already major crisis.

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