In light of a devastating collapse in the Lebanese banking sector, and amid accusations of corruption inside and outside the country, the Governor of the Banque du Liban (Central Bank), Riad Salameh, is preparing to leave his post, on Monday, after he held it for nearly 30 years.
For many years, many Lebanese viewed Salameh as the backbone of the financial system until its collapse in 2019, when Salameh watched his position crumble, as the financial collapse led to the impoverishment of a large number of citizens, and the freezing of the deposits of most savers in the banking sector, which was previously one. One of the largest sectors, according to Reuters.
His image was further tarnished when European countries began, one after the other, to open investigations into whether he had used his position to embezzle public money and make a fortune behind it.
French and German authorities issued arrest warrants for Salameh last May, and red notices issued by Interpol indicated that he was wanted in both countries.
The red notice issued at the request of France referred to some charges, including organized money laundering, while the notice issued at the request of Germany stated that he was wanted for money laundering charges as well.
In the same context, many Lebanese held Salameh responsible for the financial collapse, which caused the lira to lose about 98 percent of its value, while his last months in office witnessed some officials calling for him to submit his resignation.
Salameh said, in his interview with Reuters, days before his departure, that he “worked according to the law, and with respect for the legal rights of others” during his tenure in office, denying all the charges against him. While he defended his tenure during another interview with the BBC station last Wednesday, by saying that he had become a scapegoat for this collapse, adding that the government, not the central bank, is responsible for spending public funds.
What happened was a dramatic transformation for a man who had previously been seen as a potential president. Salameh, after assuming the position of Governor of the Banque du Liban, was able to build a good reputation as an expert in the financial system.
Salameh was a constant presence in international financial conferences, won many awards in the banking field, and enjoyed wide powers by virtue of his position, especially after savers obtained high interest rates from 1997 until the time of the financial collapse.
Their confidence was increased by Salameh’s calm manner, his statements that the lira is in a good position, as well as Lebanon’s success in overcoming the global financial crisis in 2008.
But financial conditions began to falter as dollar transfers slowed, adding pressure to a financial system that requires constant inflows of hard currency to survive.
Salameh kept the financial system afloat in 2016 by withdrawing dollars from local banks at high interest rates, which critics described as a form of fraud, because it relied on obtaining new loans in order to pay off existing debts, according to Reuters.
In a related context, Salama told Reuters that the lawyers appealed against the two arrest warrants issued by France and Germany.
Riad Salameh, his brother Raja, and his assistant Howayek were charged in Lebanon with money laundering, embezzlement, and illegal enrichment in February.
2023-07-30 20:18:22
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