November 23, 2015 | Policy Brief

Congress Moves to Target Hezbollah with New Sanctions

November 23, 2015 | Policy Brief

Congress Moves to Target Hezbollah with New Sanctions

Congress took action this week to target Hezbollah and its global network of illicit finance. The Senate passed H.R. 2297, the “Hezbollah International Financing Prevention Act of 2015,” which would impose new sanctions on entities providing the group with financial support, both in its home base of Lebanon and beyond.

The United States has designated Hezbollah as a terror group since 1995, but the new legislation would expand Washington’s ability to target the group’s activity in countries where it is only partially designated or not designated at all. The bill would also compel the U.S. to label Hezbollah a significant foreign narcotics trafficker and transnational criminal organization, thereby allowing international law-enforcement entities like Interpol to target Hezbollah’s illicit financing activities globally.

The legislation is important in light of Hezbollah’s global reach to areas in the Western Hemisphere, where it has used the drug trade, trafficking of exotic animals, and black-market sales of precious metals and gems to finance its terror activities. These funds are not only used to prop up the group’s domestic power, but to expand its increasingly brazen military operations alongside the Assad regime in Syria.

Hezbollah has also been successful in exploiting the Lebanese economy through informal transnational banking networks and real estate. The informal nature of these institutions, however, means they are difficult to track and even more difficult for the Treasury Department to designate. The legislation compensates for those obstacles by empowering Treasury to impose strict conditions on U.S. entities that transact with foreign financial institutions that knowingly work with Hezbollah.

The legislation would also attempt to limit propaganda used by Hezbollah to recruit new members and elicit financial support. This would require the State Department to report on satellite, broadcast, and internet providers that support the Hezbollah-run channel Al-Manar, which Treasury designated back in 2006.

Finally, Congress requests through this bill additional reporting from the U.S. government on Hezbollah’s global activity. This should arm the legislative branch with better information and to fund the resources needed to combat the group.

With the Iran nuclear deal set to be implemented soon, Hezbollah – as Iran’s foremost proxy group – will almost certainly be a leading beneficiary of Tehran’s sanctions relief (estimated at $90-120 billion in short-term cash relief) and will also gain from the end of the conventional arms embargo on Iran set to expire in five years. The legislation cannot halt Iran’s largesse to Hezbollah after the nuclear deal is implemented, but it could play a key role in limiting it.

Tyler Stapleton is deputy director for congressional relations at Foundation for Defense of Democracies.


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