Drug money bust reveals Hezbollah’s control

Drug money bust reveals Hezbollah’s control

February 3, 2014 The Australian Crime Commission has foiled an international narco-trafficking and money laundering scheme involving 18 organized groups and 40 separate money laundering operations.  “Project Eligo” has resulted in 105 arrests, 190 criminal charges, and over $500 million in assets seized so far.
Agence France Presse (hat tips to Willauer Prosky and El Grillo) has the highlights of the story:

Australian police crack global money-laundering racket

Sydney — Australian police revealed Thursday they had cracked a major global money-laundering ring with operatives in more than 20 countries and funds syphoned off to groups reported to include Hezbollah.
The Australian Crime Commission said more than Aus$580 million (US$512 million) of drugs and assets had been seized, including Aus$26 million in cash, in a year-long sting codenamed Eligo targeting the offshore laundering of funds generated by outlaw motorcycle gangs, people-smugglers and others.
According to the ACC, the operation had disrupted 18 serious and organised crime groups and singled out 128 individuals of interest in more than 20 countries, tapping information from agencies including the United States Drug Enforcement Administration.
The full details of which countries had been involved were not revealed but acting ACC chief Paul Jevtovic said “the reality is that the Middle East and Southeast Asia have featured prominently”…

The Sydney Morning Herald noted that, “It is believed at least one of the ‘exchange houses’ used in the Australian laundering operation delivers a cut from every dollar it launders to Lebanese militant group Hezbollah, whose military wing has been proscribed in Australia as a terrorist group.”
Hezbollah believes that profiting from the drug trade is permissible under Islam because drugs mainly harm “infidel” nations of Europe and the Americas.
Financial crimes analyst Ken Rijock has some additional insight on the Hezbollah aspect of the story, pointing out that most reports have glossed over Hezbollah’s control and ability to extort money on each financial transaction being processed through Lebanese money services businesses (MSBs).  Although Hezbollah may have only received a portion of the Australian drug money involved, the revelation suggests that no Lebanese MSB is beyond the terrorist organization’s reach:

…The drug money was laundered by being distributed to legitimate recipients of foreign money transfers in Australia, in lieu of the actual funds, which were en route to them; the criminals would then divert the payments to themselves. Coming from legitimate MSB sources, they in effect converted their illegal narco-profits, into legal foreign remittances.
Australian authorities stated that Hezbollah was extorting money from the MSB that was diverting the legitimate payments. It demanded, and received, a portion of “every dollar that it laundered.” Think about that for a moment. Hezbollah, which has no part in the drug money laundering, inserts itself into the payment process, much like a taxing authority. The Taliban have this extortion thing down to a science; perhaps Hezbollah to a page out of their playbook.
First of all, we are obviously talking about MSBs in Lebanon;  Hezbollah has the power to coerce payments in any area where it has a military presence to enforce its demands; That means Beirut…

Rijock concludes that bank compliance officers and others involved in the remittance stream should, “regard all Lebanese MSBs as probable associates with that terrorist organization, as the level of risk with Lebanese MSBs should be regarded as extremely high.”

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