The U.S. Treasury Department released a statement on Tuesday outlining new sanctions that target Hezbollah’s cash-based financial network.
Elaborating on the sanctions, Secretary of the Treasury Scott Bessent stated that the “Treasury will work to cut these terrorists off from the global financial system to give Lebanon a chance to be peaceful and prosperous again.”
The department singled out the al-Qard al-Hassan gold exchange, targeting the company Jood SARL which converts Hezbollah’s gold into liquid funds that the organization can use. The release further emphasizes that al-Qard al-Hassan carries out financial activities beyond what its NGO licensing outlines, bypassing oversight from the Lebanese state.
The statement also included associates of Hezbollah finance team member Ali Qasir, based in Iran, for facilitating sanctions evasion via Russian associates.
The U.S. Treasury department warns that all assets in the U.S. are frozen and any foreign banks or entities that help the targets risk accruing secondary sanctions from the U.S. financial system.
Hezbollah has created a parallel economy in which it set up its own institutions and services independent of the Lebanese state, historically financed by Iranian backers and illicit smuggling of goods and cash. It offers utilities including water management, and a construction industry tasked with building up its infrastructure, as well as subsidized goods at a rate different from the rest of Lebanon.
As its support system in Iran runs dry and the new Ahmed al-Sharaa government in Syria cracks down on Hezbollah’s network, the organization is even more heavily reliant on its cash smuggling operations and other fiscal assets including its gold reserves held in al-Qard al-Hassan’s umbrella.
Particularly since Lebanon’s 2019 economic collapse, from which the country has yet to recover, Hezbollah has benefitted from an increasingly unregulated cash economy to provide salaries to its contractors.
The U.S. sanctions aim to target these dynamics on a more fundamental level as the Treasury department identifies “revenue generation in coordination with the Iranian regime and exploitation of Lebanon’s informal financial sector.
Read the U.S. Treasury Department’s press release here: https://home.treasury.gov/news/press-releases/sb0393
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