New Hezbollah Sanctions Highlight Corruption, Role of Political Leadership in Terror Finance

The U.S. Department of Treasury yesterday sanctioned Amin Sherri and Mohammad Hassan Ra’ad, both of whom are Hezbollah members of the Lebanese parliament. The information that Treasury released about these individuals’ illicit activities undermines the European Union’s artificial distinction between the political and military wings of Hezbollah – the pretext for the EU’s refusal to sanction the entire organization.

In its justification for the new sanctions, Treasury emphasized Ra’ad’s dual role as “both a Member of Parliament and a member of Hizballah’s Shura Council, which directs Hizballah units to carry out overseas military and terrorist attacks.” Members of Hezbollah’s parliamentary bloc are not insulated from the party’s military and illicit financial activities. On the contrary, they are at its very center.

Treasury also revealed ongoing cooperation between the sanctioned lawmakers and Hezbollah financier Adham Tabaja, a senior leader in Hezbollah’s Business Affairs Component who oversees much of Hezbollah’s illicit financial activity overseas. In Sherri’s case, that cooperation includes partnering with Tabaja in a company identified by The Wall Street Journal as the Fantasy World amusement park.

Treasury also announced the imposition of sanctions on Hezbollah security official Wafiq Safa, an action that underscores the deep involvement of Hezbollah’s security branch in illicit trafficking. According to Treasury, “As the head of Hizballah’s security apparatus, Safa has exploited Lebanon’s ports and border crossings to smuggle contraband and facilitate travel on behalf of Hizballah.” This contraband included both illegal drugs and weapons.

Hezbollah’s leaders have donned the anti-corruption mantle in Lebanon and denied accusations that the organization draws income from illicit activities. U.S. court cases show the opposite. In 2016, for example, a Paraguayan-Lebanese dual national named Ali Issa Chamas was arrested in Paraguay on drug trafficking charges and then extradited to the U.S., where he was convicted in 2017. Court documents show that Chamas facilitated cocaine shipments to Lebanon via Beirut’s Rafiq Hariri International Airport. For one shipment of 31 kilograms, Chamas and his associates paid $10,000 per kilo to guarantee its safe passage into Beirut, knowing the money was destined to reach Hezbollah. This is consistent with Treasury’s description of Wafiq Safa’s role, in which he worked with narco-traffickers and other criminals to smuggle their product through Lebanon’s commercial entry points in exchange for bribes.

A 2009 U.S. criminal complaint against Hassan Hodroj and his associates also provides evidence that Hezbollah’s security apparatus facilitates smuggling via its control of entry points into Lebanon. While discussing smuggling operations into and out of the U.S., Hodroj and his associates revealed to undercover U.S. agents that Hezbollah had unfettered access to Syria’s Port of Latakia. Cash and weapons would then, thanks to Hezbollah’s influence, transit safely from Syria to Lebanon.

The evidence supporting yesterday’s designation clearly builds on more than a decade of Department of Justice cases against Hezbollah Business Affairs Component members and their associates. With this in mind, the Department of Justice should follow Treasury’s lead and jumpstart cases against Hezbollah’s terror finance network overseas, much of which launders money through the United States.

Emanuele Ottolenghi is a senior fellow at the Foundation for Defense of Democracies (FDD), where he also contributes to FDD’s Center on Economic and Financial Power (CEFP). Follow Emanuele on Twitter @eottolenghi. Follow FDD on Twitter @FDD and @FDD_CEFP. FDD is a Washington, DC-based nonpartisan research institute focusing on foreign policy and national security.