The U.S. Treasury Department has accused a prominent Lebanese diamond dealer and a Congo-based money launderer of funneling tens of millions of dollars to the Lebanese militia, Hezbollah, and buying high-end art works to evade sanctions.
Nazem Ahmad, a 54-year-old diamond dealer whose art collection in Beirut includes works by Pablo Picasso and Andy Warhol, doubles as one of Hezbollah’s top financial backers, according to the department’s Office of Foreign Assets Control, which blacklisted him and 11 of his companies Friday.
Ahmad, whose collection is worth “tens of millions,” according to OFAC, has personally funded Hezbollah’s leader, Hassan Nasrallah, and worked closely with an alleged money launderer in the Democratic Republic of Congo, Saleh Assi, 59, who U.S. officials claim uses at least six firms as fronts to funnel tens of millions of dollars back to Lebanon and the militia each year.
“Ahmad stores some of his personal funds in high-value art in a preemptive attempt to mitigate the effects of U.S. sanctions, and he opened an art gallery in Beirut, Lebanon, as a front to launder money” for Hezbollah, according to OFAC, which considers the group a terrorist organization.
Assi was also one of the “few remaining sources of financial support” for Adham Tabaja, a real estate businessman whom OFAC blacklisted in June 2015 for financing Hezbollah, and who allegedly maintains links with a component of the militia that plans terrorist attacks, according to the U.S. agency.
Ahmad, the diamond dealer and art enthusiast, may have provided another source of funds to Tabaja, by virtue of his involvement with him in a bank loan this year, OFAC claimed Friday.
OFAC also blacklisted a third individual in the network: Lebanese accountant Tony Saab, 42, for allegedly helping launder funds back to Lebanon from Africa while working at Assi’s company, Inter Aliment.
The agency did not specify which financial institutions may have been involved in the transfers, but noted that Saab and others moved proceeds through “bulk cash transfers” as well as through Ahmad’s diamond business.
Friday’s designation is an unusually concrete example of the money laundering risks for art dealers, who have often assumed that the primary burden of sanctions compliance fell on financial institutions, Will Rich, a former U.S. Treasury attaché to the United Arab Emirates and Oman, told ACAMS moneylaundering.com.
“In the art market it’s rare to find actors that have comprehensive sanctions compliance programs, and even rarer to find them with programs that are effective,” said Rich, now a New York-based senior vice president with Kharon, a Los Angeles-based analytics firm. “The art industry may not be responsible for BSA compliance but they are responsible for sanctions compliance.”
Contact Daniel Bethencourt at email@example.com
|Document Date:||December 13, 2019|