The President of the Republic, General Michel Aoun has publicly denounced the ill will of the Ministry of Finance Ghazi Wazni and the Governor of the Banque du Liban Riad Salamé without however directly naming them in the face of the various pitfalls and obstacles posed in the face of the forensic audit of Banque du Liban accounts and called for a meeting of the Hassan Diab government to examine this file and reveal the underside of what he describes as almost a sabotage of the process.
The head of state also accused the governor of the Banque du Liban of practices contrary to local financial legislation, such as the use of private deposits as currency reserves.
A meeting took place yesterday between representatives of the Ministry of Finance, the Bank of Lebanon and the Alvarez & Marsal cabinet, without result, deplores the President of the Republic. It was decided to hold another meeting this Friday, which confirms that there is no willingness on the part of some parties to conduct the forensic audit process.
The President of the Republic thus began by recalling the various steps taken by certain parties to avoid this audit of the central bank. He also recalled that this procedure is not only a personal request from the Head of State but also from the international community, a prerequisite for the release of funds from CEDRE and the IMF.
Before my return to Lebanon in 2005, I was aware of the risk of financial collapse, and when I became a deputy and leader of a parliamentary bloc, I insisted that a forensic audit be carried out on the accounts. of the Central Bank and that a special tribunal for Financial crime is established, but both demands have been made.
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After I was elected president, I tried for 3 years, unsuccessfully, to open the door to a forensic audit to protect people’s deposits; The financial and monetary crisis is worsening and signs of collapse began in July 2019 and were revealed on October 17 of the same year.
Before my return to Lebanon in 2005, I was aware of the risk of financial collapse, and when I became a deputy and leader of a parliamentary bloc, I insisted that a forensic audit be carried out on the accounts. of the Central Bank and that a special tribunal for Financial crimes is established, but the two claims have been put in drawers
Put aside political differences, called on the head of state, who calls on the population to trust him on this subject.
“You may disagree with me politically, but you will always find me by your side, and I present to you a battle that exposes the biggest looting operation in the history of Lebanon, so be with me.”
The head of state thus called on the outgoing government to meet to clarify the thefts and embezzlements committed by the Bank of Lebanon and the system in place, citing politicians and local banks, whom he accused of mismanagement, the supervisory and control bodies that have failed.
The speech of the President of the Republic
Dear Lebanese,
A few months have passed since the government of President Hassan Diab was tasked on March 26 last year, through Finance Minister Ghazi Wazni, with taking the necessary steps to carry out the criminal investigation into the accounts of Bank of Lebanon in order to know the reasons for the financial deterioration and to reveal them.
Doubts were confirmed day by day that the accounts of central banks were not transparent and did not know the extent of the loss of foreign currency reserve, which was covered by the funds of the depositaries contrary to the law.
The futile arguments were prevented by the Council of Ministers from hiring the global company ′ ′ ′ Kroll ′ ′ to carry out criminal checks, after enormous efforts the Council of Ministers agreed to entrust the company with Alvarez and Marsal.
The Minister of Finance was tasked with signing the contract on September 1, 2020, that is to say more than five months after the decision of the Council of Ministers.
Alvarez and Marsal through the Minister of Finance asked the Banque du Liban 133 questions. This one answered only 60 questions and refused to answer the others, either on the pretext that it is a violation of the monetary law and the loan, or because it does not has no answer.
On October 20 of last year, the company again asked the questions to the Banque du Liban and went unanswered.
The criminal investigation faced several obstacles. They claimed that the law on banking secrecy prohibited the examination of the accounts of the Bank of Lebanon. I sent a letter to the parliamentary council and its response was that the central bank accounts were subject to criminal scrutiny. We went further, the House of Representatives passed a law that suspends the application of the law on banking secrecy for a period of one year.
All these steps were completed, and the obstacle continued until the Minister of Finance admitted a few days ago that the Central Bank was refraining from answering a large number of questions from the company Alvarez and Marsal .
It has become clear that the aim of the delay is to drive the Lebanese to desperation to leave the country and thus stop the criminal investigations.
O Lebanese,
The fall of the criminal investigation means hitting the French initiative because there is no international aid, no Cedre conference, no Arab and Gulf support, no international fund.
The criminal investigation is the first step in finding out who caused the crime of financial collapse.
The criminal examination is not a personal request of the President of the Republic, but rather at the heart of the French initiative and the requests of the IMF, which is above all the request of all Lebanese.
For the custodian whose deposits were stolen from the bank and have evaporated, for a patient waited outside the door of the hospital and who has no money to enter, they are told that their funds are not not available.
For the student who traveled to receive the knowledge and suddenly stopped transferring money from his family, for the parents who are no longer able to insure the family money due to the collapse and of the deterioration of the ivy currency, for the retiree who relied on his compensation at the bank to spend the rest of his life with dignity.
Lebanese,
You may agree with me politically, but you will always find me by your side with the truth.
I present to you in the battle of revelation of the greatest plunder in the history of Lebanon, be with me.
Put aside your political differences and believe that we will not let them rob the people and defeat a father and insult a sick person.
We will not let them tear down the criminal examination or wipe out the state, the people, history and the future.
To political and non-political leaders, your responsibility is great before God, the people and the law, and what happened could not have happened if you had not provided the minimum cover to the central bank, to private banks and the Ministry of Money.
At the central bank, you take primary responsibility for violating the monetary and credit law, and you should have organized the banking work and taken steps to protect people’s money in the banks and enforce the coverage standards. and liquidity.
For the banks, your responsibility is clear and you cannot escape the truth.
People have entrusted their money to you, and you have spent the irresponsibility of greed for quick profit and without ′ ′ risk distribution ′ ′ to the demands of the profession.
All governments, departments, ministries, councils and bodies are responsible for every penny wasted over the years, and all should be included in the criminal investigation.
For the countries that claim to be in solidarity with the Lebanese people, you demand transparency in the central bank and in the whole banking sector and financial and monetary reforms, help us identify the money transfers that took after October 17 2019 financial smuggling.
This money is in foreign currency and was transferred from Lebanon to well-known banks around the world.
Such operations cannot be hidden.
If the decision is made, we are able to know which relates to the funds of the Lebanese abroad, and we are able to investigate and verify if this money is clean, how its owners got it and if it. there is possibility to recover these funds.
The criminal investigation is the beginning and perhaps a more difficult battle than the liberation of the land because it is against the corrupt and the “thief” who are more dangerous than the occupier and the client.
Whoever steals people’s money is stealing our homeland.
Lebanese,
Pay attention, the abandonment of the criminal investigation hit the government’s decision that I invite to convene an extraordinary session to make the appropriate decision to protect people’s deposits, reveal the reasons for the collapse and determine the responsibilities in anticipation of liability and recovery of rights.
I am Michel Aoun, President of the Republic and General whom you know.
I am calling you, not to be with me, but to be with yourself and with the future of your children.
Let’s reveal the facts together to recover the rights.
“We do not agree with the policy.”
Yes to the criminal investigation so that you live and that Lebanon lives ”.
Lebanon accumulates crises
Lebanon is now faced with several crises, economic crisis, crisis linked to the coronavirus, and now crisis linked to the explosion of the port of Beirut, to which is now added a political crisis due to the resignation of the Hassan Diab government .
The Land of Cedars has been without government since August 10.
For the time being, the release of international aid is conditional on the outcome of the negotiations undertaken with the IMF, which requires that the necessary reforms be put in place, particularly economic and monetary reforms. Indeed, many sources or personalities involved in the case multiply the declarations indicating that the international community will not grant “no blank check to Lebanon”, following the non-respect by Beirut of its promises and its commitment to carry out. the reforms necessary for economic recovery already at the Paris I, II and III conferences in the 2000s.
The banking sector crisis, although masked by the financial engineering operations carried out by the Banque du Liban, had started much earlier, despite the colossal profits announced by Lebanese banks until last year. In reality, the Banque du Liban thus repaid nearly 16 billion dollars between 2016 and 2018, thus emptying a large part of its monetary reserves in favor of banking establishments.
On the economic front, the crisis that began in 2018 came to light in the summer of 2019 with a shortage of foreign currency, which is nevertheless necessary for the purchase of basic necessities in particular. However, a reversal of financial flows had been observed as early as January 2019. This crisis was then accentuated following the unilateral imposition by Lebanese banks of capital controls, thus blocking access to accounts.
In addition, the deterioration of socio-economic conditions led to numerous demonstrations from October 2019, the demonstrators denouncing a political class considered as corrupt and demanding the departure.
After the resignation of former Prime Minister Saad Hariri on October 29, 2019, a new government chaired by his successor Hassan Diab was formed on January 17, 2020. As early as March, the Lebanese authorities announced a state of default on maturing Eurobonds. In addition, Lebanon has opened negotiations with the IMF with a view to obtaining economic aid of the expected amount of 10 billion dollars.
However, the negotiations, now suspended, quickly stumbled over the capacity of the Lebanese authorities to carry out the reforms necessary for the release of international aid as well as on the issue of quantifying the losses of the financial sector. The Lebanese authorities estimate that its losses would reach 241 trillion Lebanese pounds on the basis of an exchange rate of 3600 LL / USD. , that is to say approximately 80 billion dollars, which the local banks refuse via the association of the banks of Lebanon or the Bank of Lebanon itself.
The association of banks in Lebanon has thus activated its relays present in parliament. via the parliamentary finance and budget committee. The latter, where some shareholders and representatives of local banks are present, only quantified the financial losses at 81 trillion Lebanese pounds on the basis of an exchange rate of 1507 LL / USD. .
Henceforth, this encryption of the accounts of the Banque du Liban should be carried out by the firms Alvarez & Marsal for the forensic audit and by KPMG and Oliver Wyman for the normal audit . First approached to conduct the forensic audit, the Kroll cabinet, specializing in the matter was dismissed following pressure from the president of the chamber Nabih Berri, considering the company linked to the Hebrew state .
In parallel, the association of banks in Lebanon presented a rescue plan rejected by the IMF and the Lebanese authorities, providing for the sale of part of Lebanon’s gold and the fixed-term session of public goods. This plan is also rejected by specialists who believe that the sale of public goods could only be done by selling them off because of the current circumstances.
Some sources are now citing losses for the financial sector exceeding $ 100 billion, estimating that Lebanon would now require a stimulus package of 63 billion dollars but only 26 billion at most are available . According to these same sources, all Lebanese banks are now insolvent.
The economic situation has further deteriorated with the deterioration in the value of the Lebanese pound and the implementation of different exchange rates: official exchange rate at 1507 LL / USD, the so-called market exchange rate. for stockbrokers or some companies fixed by the Bank of Lebanon, today at 3,900 LL / USD and the black market exchange rate, which fluctuated until reaching 9,000 LL / USD, in June.
Finally, the explosion of the port of Beirut , which also ravaged much of the Lebanese capital, further aggravated the situation, with damage estimated at between $ 10 billion and $ 15 billion.
Thus, if the growth rate of gross domestic product is estimated at -14% before this explosion, d New estimates point to an economic recession of -24% in 2020 .
At the same time, Lebanon is also affected by the coronavirus. The measures taken by the authorities have proved to be insufficient today and the country of cedars risks losing control of the epidemic, with an almost uncontrolled increase in the number of cases, especially after the explosion of the port of Beirut. Now, current hospital capacities have been saturated for 2 weeks, also leading to an increase in the number of deaths since the end of August.
For the time being, some experts familiar with the matter note with concern that politico-economic interests are more important for certain parties than the general interest in benefiting from economic aid in the face of the crisis, to the point of estimating that traditional divisions political parties have faded from parliament in favor of the banking party and others.
Also, some of these interests would even have gone so far as to threaten a civil war if the reforms demanded by the international community were carried out. However, it remains firm on this matter.
During his trip to Lebanon on the occasion of the centenary of the proclamation of the state of Greater Lebanon, on September 1, 2020, the day after the appointment of Mustafa Adib as prime minister , the President of the French Republic would thus have handed over to the Lebanese leaders, a roadmap for the implementation of the economic reforms deemed necessary and first, a diagnosis of the losses of the Banque du Liban. This roadmap also provided for the establishment within two weeks of a government capable of carrying out these reforms. However, 15 days later, following the expiry of the allotted time, the Lebanese authorities seem to have failed to set up a new cabinet, notably following the announcement by Washington of economic sanctions targeting Ali Hassan Khalil, arms- right of Nabih Berri and former Minister of Finance, the other political parties having accepted the principle of rotation of sovereign ministerial portfolios, namely defense, interior, foreign affairs and finance.
On September 21, 2020, the President of the Republic considers that Lebanon is currently heading “to hell” due to the deterioration of social and economic conditions, further acknowledging that the reserves of the Banque du Liban – currently subsidizing the purchase of basic necessities – will be exhausted shortly.
On September 26, taking note of his failure, the prime minister-designate announced his resignation from the steps of the Baabda Palace, plunging Lebanon a little more into crisis.
For his part, the governor of the Bank of Lebanon Riad Salamé announces, in August, the end of subsidies to essential products within 2 to 3 months due to the decrease in monetary reserves of the Central Bank.
This announcement comes as negotiations with the International Monetary Fund are still suspended and a forensic audit of the Banque du Liban is taking place.
Thunderclap, the firm of Alvarez & Marsal announces its withdrawal from the forensic audit procedure , November 20, 2020 after the Banque du Liban refused to answer 57% of the questions asked , under the pretext of the credit and currency code or even legislation related to banking secrecy, plunging Lebanon into uncertainty. Indeed, this audit is now considered essential for obtaining assistance from the international community. The Ministry of Finance or that of justice considered that the contract did not violate the texts in force.
In his speech on the occasion of the 77th commemoration of the independence of Lebanon, General Michel Aoun indicates that the procedure should nevertheless go to the end and therefore envisages recourse to parliament to force the Banque du Liban to comply while the governor of the Banque du Liban Riad Salamé would be in Paris in order, indicate some sources, to find an agreement with France, leader of the community international organization which remains intractable so far on the need to conduct a forensic audit of central bank accounts.
April 7, 2021, the President of the Republic General Michel Aoun publicly denounced the ill will of the Ministry of Finance Ghazi Wazni and the Governor of the Banque du Liban Riad Salamé without, however, directly naming them in the face of the various pitfalls and obstacles faced with the forensic audit of the Banque du Liban accounts and called for a meeting of the Hassan Diab government to examine this file and reveal the underside of what he almost describes. as a sabotage of the procedure.
The head of state also accused the governor of the Banque du Liban of practices contrary to local financial legislation, such as the use of private deposits as currency reserves. The President of the Republic recalled the various steps taken by certain parties to avoid this audit of the central bank. He also recalled that this procedure is not only a personal request of the Head of State but also of the international community, a prerequisite for the release of funds from CEDRE and the IMF.
In addition, in the face of the crisis, some correspondent banks of the BdL would have closed the accounts , indicates in a letter Riad Salamé.
These would include dollar accounts with Wells Fargo, sterling accounts with HSBC, Swedish krona with Danske and Canadian dollar accounts with CIBS.
According to the governor of the Banque du Liban, these decisions would be motivated by the state of default, the political campaigns targeting the Bank of Lebanon and by “the judicial outcry”, allusion to accusations of embezzlement and corruption against Riad. Salamé himself
