Lebanon charges ex-central bank governor Salameh over alleged $44.8 million embezzlement

By Laila Bassam

Lebanese prosecutors have indicted former central bank governor Riad Salameh and two lawyers on charges including embezzlement of public funds, forgery and illicit enrichment, judicial authorities said on Tuesday.

Salameh, who headed the Lebanese Central Bank for three decades, was detained for about 13 months over alleged financial crimes committed during his tenure and was released in September after paying record bail of more than $14 million. The banker, who remains in Lebanon and is subject to a travel ban, has denied any wrongdoing.

According to a copy of the indictment issued by Beirut's indictment chamber seen by Reuters, the panel accused Salameh alongside lawyers Marwan Issa el-Khoury and Michel John Tueni of embezzling $44.8 million from what it described as a central bank "consultancy account".

It said the chamber also approved a request by the financial public prosecutor to widen investigations into how funds were moved into and out of banks without senior bank managers notifying the central bank's Special Investigation Commission.

KHOURY SAYS HE HAS NO KNOWLEDGE OF 'CONSULTANCY ACCOUNT'

In a statement to Reuters, Khoury said he had no knowledge of the "consultancy account" referenced in the charge, had not been involved in the central bank's financial transactions and had never received funds from the institution.

He said the indictment itself called for a continuation of the inquiry and that there should not have been an accusation against him before the investigation was complete.

Khoury said the inquiry had already proved that he had not received any funds from the central bank or any fees in relation to its financial transactions.

Tueni could not be reached for comment.

The indictment follows earlier moves by the central bank to file a criminal complaint against a former senior bank official at the central bank, a former banker and a lawyer over alleged illicit enrichment through misuse of public funds, the bank's acting governor Wassim Mansouri has said.

Salameh, whose 30-year term ended amid a cascade of domestic and international investigations, has been under scrutiny over allegations that more than $300 million was siphoned off between 2002 and 2015.

The central bank has said it will act as a principal plaintiff in a state investigation into Forry Associates, a company suspected of receiving commissions from commercial banks and transferring them abroad. The company is controlled by Salameh's brother Raja, who also denies wrongdoing.

The Salameh brothers are under investigation in France, Germany, Switzerland and other countries over alleged embezzlement.