Perspectives - September 18, 2020

Treasury Targets Hezbollah Executive Council Companies and Official

On Thursday, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) sanctioned two Lebanon-based companies, Arch Consulting and Meamar Construction, for being owned, controlled, or directed by Hezbollah. Additionally, OFAC designated Sultan Khalifah As’ad, a Hezbollah Executive Council official, who is closely associated with both companies.

According to the Treasury Department, Arch and Meamar are two of several companies subordinate to Hezbollah’s Executive Council. Its press release states that Hezbollah takes advantage of these entities’ privately-owned appearance to conceal money transfers for Hezbollah to evade U.S. sanctions. As of 2019, Hezbollah worked with U.S.-designated former Lebanese Minister Yusuf Finyanus to ensure that Arch and Meamar won bids for Lebanese government contracts worth millions of dollars. Both companies in turn sent some profits from these contracts to Hezbollah’s Executive Council. Sultan Khalifah As’ad is publicly listed as a founder of Meamar, and is also the deputy of Hezbollah Executive Council chairman Hashem Safieddine.

U.S. Accuses Hezbollah of Stockpiling Caches of Ammonium Nitrate Throughout Europe

The U.S. State Department’s Counterterrorism Coordinator Ambassador Nathan Sales revealed on Thursday that Hezbollah has been storing caches of weapons and ammonium nitrate for use in explosives across Europe since 2012. Sales said, “I can reveal that such caches have been moved through Belgium to France, Greece, Italy, Spain, and Switzerland. I can also reveal that significant ammonium nitrate caches have been discovered or destroyed in France, Greece, and Italy.” Sales assessed that Hezbollah was engaged in this activity so it “can conduct major terror attacks whenever its masters in Tehran deem it necessary.”

New IRA Forged Links with Hezbollah, Seeks Weapons from the Group

The New IRA, the largest of the Irish republican dissident groups, is thought to have forged alliances with Hezbollah, among other radical groups in the Middle East, which may be providing it with weapons and finances. Irish and British security services suspect that the New IRA’s links with Iran-backed Hezbollah may have led to the import of arms including mortars and assault rifles. Hezbollah and the New IRA opened communications around 2017. Members of the New IRA then traveled to Lebanon in 2018 to meet with Hezbollah representatives, where British security services suspect they procured the weapons. Saoradh, the political wing of the New IRA, has been a long-time supporter of Iran, Hezbollah’s patron.

Lebanese Pound Falls Against Dollar on Black Market

The Lebanese pound fell against the dollar Wednesday, trading at around LL7,600 on the black market as the government formation process continued to be stalled, now past its 15-day deadline. Unlicensed currency exchangers were selling the dollar for LL7,650 and buying it for LL7,550, while licensed traders continued to buy and sell the greenback at LL3,850 and LL3,900 respectively. The pound had been trading as high as LL7,500 to the dollar Tuesday.

Hezbollah Insists on Retaining Finance Ministry

Hezbollah’s parliamentary bloc Thursday said it would insist on assigning the position of finance minister to a Shiite candidate. “We categorically refuse that anyone on our behalf names ministers that represent us in the government,” the bloc said in a televised statement after its weekly meeting.

The bloc also blamed the delay in government formation on the recent U.S. sanctions on two former ministers. “We condemn the extremely negative American role to obstruct government formation efforts,” the Loyalty to the Resistance bloc said.

French Ambassador Meets with Hezbollah

Hezbollah-linked Al-Mayadeen News reported that the French Ambassador to Lebanon Bruno Foucher met with Hezbollah officials in south Beirut. Per the report, during the meeting – which was described as “cordial” – Hezbollah’s officials reiterated their position on government ministry allocations. The report stated that Foucher did not present an alternative to a Hezbollah or AMAL-linked Shiite to head the Finance Ministry, and did not blame Hezbollah for creating the deadlock that caused the French-imposed government formation deadline to pass without the creation of a new cabinet.

France had urged a 15-day deadline – which ended on Tuesday – to form a government. Lebanese officials had committed to French President Emmanuel Macron during his last visit to Lebanon that they would form a government by September 1, 2020. But efforts to form one have hit an impasse with AMAL Movement head and Parliament Speaker Nabih Berri, backed by Hezbollah, insisting that the Finance Ministry be excluded from the proposed shake-up. Prime Minister-designate Mustapha Adib is in favor of rotating the leadership of ministries like the Defense, Interior, and Foreign Ministries among the main sects, while Berri is adamant that a Shiite should stay at the helm of the Finance Ministry.

Adib, Aoun agree to give more time for Cabinet talks

Prime Minister-designate Mustapha Adib and President Michel Aoun Thursday agreed to allow more time for consultations to break the Cabinet deadlock as political leaders struggled to find a solution for the dispute over which sect will helm the Finance Ministry. Despite the government formation impasse, reports indicated that Adib had no intention of stepping down from his role. Earlier reports had claimed that Adib was expected to either present President Aoun with a draft Cabinet lineup or step down. Additionally, sources from within the Baabda Presidential Palace said that no timetable would be placed on Adib to form a government or step aside. On Friday, Reuters reported that France’s President Emmanuel Macron called Lebanese leaders in an attempt to move the government formation process forward.

Israel Charges East Jerusalem Woman with Aiding Hezbollah

An Israeli court on Friday charged a Palestinian woman from East Jerusalem with membership in Hezbollah, after Israel's internal security service said the group had recruited her five years ago. Yasmine Jaber was arrested in early August. The Shin Bet internal security service said she was recruited by Hezbollah operatives at a conference in 2015 and asked to recruit others in East Jerusalem. It said she traveled to Istanbul on several occasions to meet Hezbollah operatives and communicated with them via social media.