It looks like you're using an Ad Blocker.
Please white-list or disable AboveTopSecret.com in your ad-blocking tool.
Some features of ATS will be disabled while you continue to use an ad-blocker.
The US Congress passed the Hezbollah International Financing Prevention Act (HIFPA) in December last year. Its goal was to broaden existing financial sanctions against both Hezbollah, the Lebanese Shi’ite group designated a terrorist organization by the US, and Hezbollah-affiliated Lebanese television station al-Manar.
Katherine Bauer, a senior fellow at the Washington Institute for Near East Policy and a former official at the US Treasury Department, says: "When this legislation came out, Lebanese regulators were already requiring their banks to abide by US regulations when dealing in dollars." But, Bauer continues, tensions mounted when Lebanese banks decided to go above and beyond the US restrictions: "There are anecdotal accounts that banks are cutting off all kinds of accounts related to Hezbollah-affiliated parliamentarians, aspects of Hezbollah’s social support network like hospitals, family members’ accounts."
"Banks in the Middle East," Bauer says, "in places that are perceived to be or are higher risk, are having a hard time maintaining correspondent relationships with US banks. Their risk calculation is, as a bank, and especially a Lebanese bank, where the majority of trade is denominated in dollars: 'I won’t survive if I lose my US correspondent, so I’m going to do everything I can to make sure that relationship is maintained’. And, in this case, even at the risk of violence." The violence happened on the night of June 12, when a bomb exploded outside Blom’s headquarters: "Two were injured, but [it was done] to send a message to the banking sector there," says Bauer.
Full article: Euro money
Visit Euromoney for additional distribution rights. For more articles like this, follow us @euromoney on Twitter.