By Nate Raymond
NEW YORK, June 25 A Lebanese bank accused of
being at the center of global money-laundering schemes tied to
the militant group Hezbollah has agreed to pay a $102 million
settlement, U.S. prosecutors in New York said Tuesday.
The settlement would resolve a 2011 lawsuit that accused
Lebanese Canadian Bank of using the U.S. banking system to
launder drug-trafficking profits through West Africa back to
"Today's settlement shows that banks laundering money for
terrorists and narco-traffickers will face consequences for
their actions, wherever they may be located," U.S. Attorney
Preet Bharara said in a statement.
Most of the bank's assets were acquired by the Lebanese
subsidiary of France's Societe Generale after the U.S.
Treasury Department designated Lebanese Canadian Bank as a
"primary money-laundering concern" in February 2012.
The $102 million would come out of $150 million previously
seized in August 2012 by the U.S. government, the Justice
The Societe Generale subsidiary, Societe Generale de Banque
au Liban, would receive the other $48 million. Lebanese Canadian
Bank would pay another $12 million to Societe Generale, the
Justice Department said.
Evan Barr, a lawyer for Lebanese Canadian Bank, said the
settlement "certainly resolves (the case) for our client." He
said the bank is in liquidation in Lebanon following its $580
million purchase by Societe Generale.
Mike Sullivan, a lawyer for Societe Generale, said in an
email the bank was pleased the seized funds would be released
and that its $90 million claim had been "favorably resolved."
The U.S. Justice Department sued the bank in December 2011
alleging a massive scheme involving two exchange houses linked
to Hezbollah, which the U.S. lists as a terrorist organization.
Prosecutors alleged that from January 2007 to early 2011,
the bank and other financial institutions transferred at least
$329 million to the United States to buy cars subsequently sent
to West Africa.
Prosecutors said Lebanese Canadian Bank played a key role in
laundering the proceeds of those car sales and profits from
narcotics trafficking, enabling the money to arrive back in
Lebanon. The lawsuit sought a $230 million from the bank.
The settlement follows an accord reached last week with
Hassan Ayash Exchange Company, one of the exchange houses, which
agreed to forfeit $720,000.
The case is U.S. v. Lebanese Canadian Bank SAL, et al, U.S.
District Court, Southern District of New York, No. 11-9186.