In a civil complaint filed in Manhattan, federal prosecutors claimed that Lebanese Canadian Bank and two Lebanese exchange houses participated in a laundering scheme for the Hezbollah terrorist group for more than $480 million. The suit claims that defendants got money from Lebanon to purchase used cars in the U.S. and sell them in West Africa.
The complaint stated that money generated from car sales and from drug trafficking was directed through Hezbollah-linked money laundering channels and back to Lebanon.
In a statement, U.S. Attorney Preet Bharara said that the complaint discussed a complicated scheme that shows the ways that terrorist organizations fund themselves and transfer their money. Last February, the U.S. Treasury Department named Lebanese Canadian Bank as a "financial institution of primary money laundering concern.”
What happened next is that U.S. financial institutions ended their ties to the bank. This means that it could no longer send any amount to the U.S. In 1997, U.S. President Bill Clinton designated Hezbollah, based in Lebanon, to be a foreign terrorist organization. The suit was filed against two Lebanese exchange firms, Hassan Ayash Exchange Co. and Ellissa Holding. [source: Bloomberg]