April 05, 2012

Eyes on Hezbollah

Hezbollah is aligned with the Al-Quds Force, the special forces branch of the Iranian Revolutionary Guards. The party is part of the world's “most capable and expansive terrorist organization,” with extensive activities inside America, and is also involved in the global drug trade.  This is a summary of a recent hearing held by the US House of Representatives Committee on Homeland Security in which several experts testified on why Hezbollah and Iran are a threat to the US. 
The hearing focused on the threat of a terrorist attack on US territory, but experts and analysts stressed on a different perceived threat: Hezbollah’s involvement in diverse criminal activities in America such as smuggling of cars, cigarettes and drugs, as well as money laundering. Over the past decade it has been the Drug Enforcement Agency and Department of Treasury’s job to deal with Hezbollah’s activities on US territory.

American financial security institutions have been working hard to prove that there is a link between Hezbollah, the Al-Quds Force and criminal organizations in Latin America.  Experts also warn that the increasing number of investigations into the party’s money laundering activities raise questions about the reliability of the Lebanese banking system.

Three major investigations have been concluded last year by US law enforcement agencies: the alleged plot to assassinate the Saudi ambassador in Washington involving an Al-Quds agent who allegedly hired thugs from the Mexican Los Zetas drug cartel for the job; the black-listing of the Beirut-based Lebanese Canadian Bank for laundering money from smuggling cocaine and car parts; and the indictment of the Lebanese-Colombian drug lord Ayman Joumaa. All three of them sounded an alarm across the US.

Many officials say Hezbollah members and supporters kept below the radar in the US, but according to former FBI Criminal Investigative Division director Chris Swecker, Hezbollah’s “presence and deep entrenchment in American society and business has the potential to provide a platform to support a more lethal capability.”

The Lebanese community in New York is kept under close surveillance by the New York Police Department, according to the force’s director of intelligence analysis, Mitchel Silber. “Some individuals in New York are family members of Hezbollah political leaders or Hezbollah fighters who have been killed, are associates of known ranking members of Hezbollah, or have received military training from Hezbollah in Lebanon,” he told the House committee.

But experts find more of a threat in the laundering of money made in drug smuggling. According to Michael Braum, a former DEA investigator, Hezbollah got its start in the drug business “a few years ago, acquiring and shipping small 10 to 15 kilogram quantities of pure cocaine to Europe, Israel, the United Arab Emirates, Egypt and other locations where they could sell the small drug shipments for up to $1 million dollars in profit.” 

“Hezbollah operatives and supporters working in the Tri-Border Area [between Brazil, Paraguay and Uruguay] and other areas of Latin America are now routinely acquiring and shipping multi-tons of cocaine to West and North Africa for onward movement to markets in Europe, the Middle East and elsewhere. And where you find Hezbollah, you most assuredly find Al-Quds Force operatives working with them. Remember that it was the Al-Quds Force that helped [bolster] Hezbollah in Lebanon, and they have been inseparable ever since,” Braum said. 

According to David Asher, a money laundering expert with the Center for a New American Security, Hezbollah-controlled banks have also gained priority in American investigations related to money laundering. “Law enforcement is a reactive business. The law enforcement agencies are reacting to the fact that there is a huge suspicious financial activity involving Hezbollah. They did not just go out and pick a fight with Hezbollah,” he told NOW Lebanon. Asher also said that the concern in the US that Hezbollah makes money from smuggling activities in Latin America or West Africa is not new, but what makes it different during the last few years is the scale of the money laundering taking place through financial institutions such as the Lebanese Canadian Bank.  
Asher said it is not surprising that US authorities took notice of the huge amount of money coming from Los Zetas and other drug cartels through the Lebanese Canadian Bank into the US banking system. The key that led to the DEA uncovering the whole affair was the investigation into Lebanese-Colombian citizen Ayman Joumaa, who has been indicted in absentia in the state of Virginia for coordinating shipments of tens of thousands of kilograms of cocaine from Colombia through Central America for sale to Los Zetas.

In December 2011, the US federal government filed a suit in the Manhattan Federal Court, seeking $480 million in penalties from the Lebanese Canadian Bank, two Beirut-based money exchange houses, and 30 auto dealers in the United States.

“I am sure that the phenomenon is much bigger. Why does Lebanon need so many exchange houses, when it has so many banks? The number of exchange houses in Lebanon is attracting attention in the US right now,” Asher pointed out. If the drug cartels in Mexico use exchange houses to launder money, their equivalents in Lebanon might be doing the same, he added.

“I think these activities and the exposure that these cases have received are a threat to the Lebanese banking system.  Not only have we had a money laundering conspiracy, we have a terrorism financing problem [as far as the US is concerned]. It is in Lebanon's interest to ensure its financial system is not being abused, especially by a terrorist group. The best way forward is significantly enhancing compliance, transparency and accountability,” he said.