This is not the first time that Riad Salameh has been prosecuted for embezzling and laundering money. The same thing previously occurred in the case concerning the commissions paid to Forry Associates. It is the first time, however, that he has been arrested. The arrest surprised all observers, especially as it came from the cassation public prosecutor (Jamal Hajjar), who is considered – in the prevailing understanding of this judge’s function – the judge closest to the ruling class. While the prosecution in the Forry case came after a series of legal procedures that the public could follow, beginning with the receipt of a letter from the Swiss Public Prosecution in 2020 and ending with the arrival of a European delegation to investigate the case in 2023, the new case against Salameh was initiated without any overtures, except for the measures that Hajjar took to prevent Public Prosecutor in Mount Lebanon Ghada Aoun from investigating the Optimum Invest commissions in June 2024. When the charges in the Forry case were filed, everyone understood the reasons and factors that pushed the Public Prosecution to begrudgingly agree to them after prolonged reluctance or hesitation. However, the factors that prompted the Public Prosecution to move forward with the current charges remain open to many interpretations. The most credible is the concern that Lebanon will be blacklisted, which would have a large negative impact on transfers and the economy as a whole, and the course of the European investigations.

In other words, there are many signs that the prosecution came, as in the Forry case, as a result of a backtracking by the political authority from its red lines on the subject of investigating Salameh for financial crimes. Questions, however, are swirling around the factors that forced this backtracking at this specific time and, more importantly, its scope and dimensions. Is the backtracking due to the prosecution of this case (which concerns the embezzlement of USD42 million), or does it reflect a commitment to clarifying the facts surrounding the administration of the central bank’s funds as part of a broader commitment to combating money laundering pursuant to Lebanon’s international obligations? Does it relate to specific measures, perhaps including Salameh’s arrest, or is it a sign of a commitment to transparent investigation procedures and, most importantly, to removing any obstacles or impediments facing the investigation? Moreover, visible efforts by powerful forces to limit the scope of the case indicate the state of anticipation and caution that these forces are experiencing now that it has been opened. These forces fear that they will be compelled to make further concessions or even completely lose their control over the course of the investigation, especially if facts and evidence leak out and domestic and foreign factors cause the demand for accountability to snowball.

A close examination of this case, as well as the outcome of the Forry case, also shows that these forces are continuing, because of this caution and fear, to reserve the ability to block the entire judicial process if their drift toward concessions becomes more costly to them than resisting any serious scrutiny of past accounts.

From this angle, the investigation seems to be part of an ongoing negotiation (presumably over Salameh’s freedom and the case’s scope), which could result in a turn towards constricting or expanding the case.

This is what I shall explore in this article.

A Prosecution That Reflects a Political Concession

The first thing to note about this case is that Salameh’s prosecution, and especially his arrest, signals a clear political retreat toward curtailing the system of impunity and allowing a breach in its thick walls, although we still do not know whether this curtailment is temporary or permanent. This retreat is evident from several facts.

Firstly, the arrest was decided by the cassation public prosecutor, which is the judicial office most connected to the ruling circles, at least per the understanding of the people who have occupied it. In other words, the cassation public prosecutor is the judge who shapes penal policy in coordination with the political authority, taking into account security and political considerations. This is virtually conclusive evidence that Hajjar made his decision with the full approval of the political authority.

Secondly, the charges came from Financial Public Prosecutor Ali Ibrahim. In addition to Ibrahim’s history of dropping massive financial cases, he himself refused former cassation public prosecutor Ghassan Oueidat’s request to charge Salameh in the Forry case, despite the strong evidence, on the basis that Salameh was his superior in the Special Investigation Commission. Ibrahim’s insistence on this position delayed the charges for approximately six months, and thereafter, the charges only came from another prosecutor amidst pressure from the European delegation. The fact that Salameh ceased presiding over the Special Investigation Commission when his term in Banque du Liban ended does not negate Ibrahim’s obligation to recuse himself as the strong relationship between him and Salameh still stands. The fact that he rushed in the current case to file charges himself, without any question, and on the same day that it was referred to him indicates that he no longer enjoys any latitude to delay charges or recuse himself from them for any reason.

To this can be added several more facts. Most importantly, Salameh appeared in person before the cassation public prosecutor without a lawyer. Whether he agreed to this or was coerced or coaxed into it, it could not have happened in the absence of political arrangements. Moreover, the fact that he accepted the investigating judge’s order to keep him detained without appealing it indicates his certain knowledge that appealing would change no aspect of the decision at this stage. 

All these facts are remarkable because they relate to a person who has continued to claim innocence throughout the past years and generally refrained from cooperating with any oversight or judicial body. In this regard, Salameh repeatedly refused to appear before Parliament’s Finance and Budget Committee in 2020, and he opposed any forensic audit on the pretext of banking secrecy, thereby delaying the audit by Alvarez & Marsal and weighing it down with restrictions that rendered it more like a regular audit (which does not identify criminal liability) than a forensic one. Moreover, he took, in coordination with the Ministry of Interior and security agencies, clear measures to dodge notification that he must appear before Public Prosecutor in Mount Lebanon Ghada Aoun, and he has filed maljudging suits against any judge whom he fears may not comply with his requests and wishes (an approach that culminated in him contesting four compositions of the Indictment Authority in Beirut in 2023 and 2024, thereby permanently suspending the Forry case). How does it make sense for a man distinguished by such a firm refusal to cooperate with any accountability effort to come himself, and without any defense, to an interrogation unless this move is part of a political plan involving either his cooperation or coercion?

A Concession Constrained Within a Certain Scope and Some Checks?

The second matter that we must examine is, as we explained in the introduction, the clear eagerness of weighty forces inside and outside the judiciary to keep the concession within a predefined scope and set of checks. The best evidence of the extreme care to impose this scope and these checks is the adoption of flimsy arguments and illegitimate means to this end, as we shall detail below.

These checks come in three forms:

The first is the limiting of the charges to a case concerning the embezzlement and laundering of just USD42 million even though the transaction in question was part of what is now known as the “Optimum commissions”, which amounted to approximately USD8 billion. More importantly, the transaction was part of an approach that is suspected to have led to the falsification of the central bank’s accounts and their misrepresentation as profitable in order to conceal a gap that Alvarez & Marsal assessed in early 2020 at USD50 billion (a gap that devoured most of the deposits held by the bank). The restriction of the charges to this relatively limited sum can only be understood as an effort by the cassation and financial Public Prosecution offices and the central bank to limit Salameh’s prosecution to a predefined scope despite the available data. This effort is corroborated by the extreme care being exercised to exclude any other authority that could force an expansion of the investigation from the case, as we explain below.

The second is the efforts in full swing to keep Aoun’s hands off anything related to the Optimum commissions via means that are obviously illegal and arguments that continue to drown the justice sector in unprecedented absurdity. This effort is not new. Aoun has often been subjected to such decisions, sometimes accompanied by media and political smear campaigns, and faces maljudging suits filed before the Full Bench of the Court of Cassation intended to achieve the same ends. This effort came to the fore in early June 2024 when Hajjar issued a circular instructing the judicial police to disregard any order from Aoun, effectively limiting her ability to implement her decisions, on the pretext that public order requires her to desist from examining any case in which the defendant has filed a maljudging suit against her under Article 751 of the Code of Civil Procedure. At that time, the Independence of the Judiciary Coalition (IJC) issued a statement with the revealing headline “Halting Investigations into Financial Crimes Deprives the Public Prosecution Offices of Purpose”. The statement pointed out the absurdity of the interpretation of Article 751 adopted by the cassation public prosecutor.The article is transformed into a superweapon with which any defendant can unilaterally and indefinitely halt judicial investigations as long as the Full Bench of the Court of Cassation remains inoperative due to a political decision. Hence, the IJC called once again upon judges (including Hajjar) to use their power of legal interpretation to block the abuse of this article. The reason: the article’s application in this manner threatens the right to litigate and the state and Public Prosecution’s duty to ensure social peace and the state’s rights, all of which are rights and duties with constitutional force. Now, following Salameh’s arrest, we have witnessed two more steps to keep Aoun’s hands off the case. Firstly, Hajjar’s request for charges overlaps with Aoun’s investigation. Hence, he is appropriating a case pending before another public prosecutor, thereby overstepping his powers. Secondly, on September 9, i.e. just days after Salameh’s arrest, the general director of the Ministry of Justice sent to the presidents of the Courts of Appeal (including the Mount Lebanon court), out of the blue, a circular that Prime Minister Najib Mikati had directed toward them three months earlier and that instructed them to follow the cassation public prosecutor’s circular staying Aoun’s hand from cases in which maljudging suits had been filed against her. This move is bizarre as Mikati’s circular, besides being old, is null and void. A prime minister cannot direct circulars to court presidents because such a power would blatantly conflict with the separation of powers. This circular, if it is followed, completes Aoun’s encirclement by depriving her not only of her ability to use the judicial police but also of her clerks in the Public Prosecution, effectively suspending her from work. Much the same occurred as a result of the circulars issued by Oueidat and Minister of Justice Henry Khouri against Judicial Investigator Tarek Bitar in the port blast case.

The third check limiting the case’s scope is an equally clear effort to exclude the Cases Authority (which is the body legally entitled to represent the state in court) from the case, once again based on flimsy pretexts. At the behest of Salameh and the Financial Public Prosecution, First Investigating Judge Bilal Halawi decided not to allow the Cases Authority to attend Salameh’s interrogation until it proves its standing. He tasked it with proving two things in particular. Firstly, he asked it to demonstrate that the relevant ministry (the Ministry of Finance) asked it to intervene in this case, thereby suggesting that it is not entitled to intervene in the case of its own accord. Secondly, he asked it to prove that the state incurred specific damage as a result of the violations attributed to Salameh, thereby suggesting that the embezzlement of money from Banque du Liban does not in and of itself harm the state’s interests because the bank has a legal personality separate from the state.

The first demand was previously raised in the Forry case and was settled when Minister of Finance Youssef Khalil sent to the Cases Authority a letter expressing his surprise that such a request had been directed toward him and accepting its power to do whatever it sees fit to protect the state’s rights. Nevertheless, it reflects a desire to subjugate the functions of the Cases Authority to political considerations and checks. This can be done by forcing it to obtain prior approval from the minister concerned instead of intervening in cases of its own accord to protect the state’s interests, contrary to the principle that this body enjoys independence in the defense of public interest. 

As for the second demand, the IJC, in a statement issued on September 13, detailed its oddity under the circumstances of the current case. The state is the sole owner of Banque du Liban and bears, under Article 116 of the Money and Credit Law, the burden of the bank’s losses, within certain conditions. Hence, it is of course damaged by any misappropriation of the bank’s funds. Moreover, the violations attributed to the central bank’s administration contributed in a key manner to the unprecedented financial, economic, and monetary collapse. As a result of this collapse, the state lost the actual value of many of its accounts with Banque du Liban and the value of its resources and national currency, not to mention the grave damage done to its public utilities, economy, and banking sector. The IJC even noted that the damage done to the state by the violations attributed to Salameh is virtually the largest damage any state has suffered as a result of actions by the governor of its central bank, and it is among the greatest damages that a Lebanese official has caused to the Lebanese state. In other words, if the state is deemed undamaged by Salameh’s actions, the word “damage” becomes meaningless.

Making a Concession While Reserving the Right to Rescind It

Besides the above, we must note that there is no evidence of any effort to protect the investigation from the fate met by the investigation in the Forry case and, specifically, against the filing of maljudging suits under the aforementioned Article 751 in order to obstruct it. Salameh will not resort to staying the judiciary’s hand while he is detained because he needs it to release him, but he will be free to do so, just as he did in the Forry case, as soon as he is released. Hence, through its reluctance to remove the mechanism for obstructing justice via this article, the ruling authority is still reserving the ability to obstruct the investigation that it has initiated if it perceives a benefit in doing so.

From this angle, keeping Salameh imprisoned is essential for protecting the investigation and demonstrating its earnestness in the sense of Article 107 of the Code of Criminal Procedure.

Conclusion

Given the above, and while Salameh’s arrest clearly indicates a concession from the political authority on the issue of the financial and banking crisis, serious questions remain about the factors that prompted this concession and the nature and extent of it, especially as the charges are limited to one transaction that, though important, remains marginal in relation to the magnitude of the crisis. These questions are reinforced by the efforts underway to sideline the Mount Lebanon Public Prosecution, along with the Cases Authority and, by extension, the state it represents. Of course, the greatest danger remains that the investigation will be completely suspended, just as occurred in the Forry case, if Salameh is released. This indicates that the authority is reserving the power to rescind its concession if it perceives a benefit in doing so. Despite this bleak picture, this concession clearly constitutes a breach in the wall of impunity that ends the previous stasis and that we could potentially enlarge in the future. So let’s keep watch and take action.

This article is an edited translation from Arabic.