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US sanctions Hezbollah-backed MP, two Lebanese businessmen over corruption

And for the first time, an individual widely believed to be backed by former Prime Minister Saad Hariri was added to the list.

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The US sanctioned two Lebanese businessmen and one lawmaker on Thursday for “contributing to the breakdown of the rule of law in Lebanon,” the Treasury Department said.

And for the first time, an individual widely believed to be backed by former Prime Minister Saad Hariri was added to the list.

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Jihad al-Arab, a wealthy businessman in Lebanon, Dany Khoury, close to the also-sanctioned Gebran Bassil, and MP Jamil al-Sayyed were designated in the latest announcement.

“These individuals, who are members of Lebanon’s business and political elite, are being designated pursuant to Executive Order (E.O.) 13441, which targets persons contributing to the breakdown of the rule of law in Lebanon,” a statement from the Treasury Department read.

Secretary of State Antony Blinken said the US was sanctioning the three men in “solidarity with the Lebanese people, who have long demanded accountability, transparency, and an end to endemic corruption.”

Demonstrators walk near a burning fire during a protest near parliament, as Lebanon marks the one-year anniversary of the explosion in Beirut, Lebanon August 4, 2021. (Reuters)
Demonstrators walk near a burning fire during a protest near parliament, as Lebanon marks the one-year anniversary of the explosion in Beirut, Lebanon August 4, 2021. (Reuters)

Al-Arab is a wealthy businessman and was sanctioned for being awarded contracts in exchange for kickback payments to government officials, the Treasury Department said. Arab announced he was closing his businesses and leaving Lebanon earlier this year and is widely seen as one of the most corrupt men in Lebanon.

Treasury accused al-Arab of being an intermediary in 2014 to broker a meeting between top Lebanese officials ahead of the 2016 presidential election, “in exchange for two government contracts valued at approximately $200 million.”

Thursday’s announcement also cited two different contracts al-Arab received, one worth $18 million and another worth $288 million, due to his ties with powerful politicians.

Washington said Khoury is “a close business associate of US-designated Gebran Bassil,” and because of his ties with Lebanon’s former top diplomat, he received “large public contracts that have reaped him millions of dollars while failing to meaningfully fulfill the terms of those contracts.”

Khoury is notorious for being awarded a contract worth more than $100 million from the government to operate a landfill along Lebanon’s coastline in the heavily populated Burj Hammoud district. Khoury’s company has “been accused of dumping toxic waste and refuse into the Mediterranean Sea, poisoning fisheries, and polluting Lebanon’s beaches, all while failing to remedy the garbage crisis,” Treasury said.

As for al-Sayyed, one of the more disliked MPs in Lebanon, Treasury said he “sought to skirt domestic banking policies and regulations and was aided by a senior government official in transferring over $120 million to overseas investments.”

He is close to Hezbollah and Syria’s President Bashar al-Assad. He is also the former head of Lebanon’s General Security and called on Lebanese security officials to shoot and kill protesters during the 2019 uprising when people demonstrated in front of his home.

The MP tweeted that he would hold a press conference to respond to the sanctions announcement on Friday.

A view shows Lebanon's Central Bank building in Beirut, Lebanon February 10, 2021. (Reuters)
A view shows Lebanon's Central Bank building in Beirut, Lebanon February 10, 2021. (Reuters)

“The Lebanese people deserve an end to the endemic corruption perpetuated by businessmen and politicians who have driven their country into an unprecedented crisis,” Director of the Office of Foreign Assets Control (OFAC) Andrea Gacki said. “Now is the time to implement necessary economic reforms and put an end to the corrupt practices eroding Lebanon’s foundations. Treasury will not hesitate to use its tools to address impunity in Lebanon.”

Read more: US officials in Beirut as new sanctions await Lebanon’s politicians and Iran