Lebanese Canadian Bank Laundering Case

As of November 2026: As of November 2026 the 2013 settlement is the last resolution of the claims against LCB found. The SDNY said the forfeiture action continued against other alleged participants in June 2013; its later outcome was not reviewed. The December 2011 press release, the original and amended complaints and the settlement order were not opened, so details of the complaints rest on the SDNY's June 2013 release, and whether LCB admitted or denied the allegations is not known from the sources reviewed. The US indictment of Ayman Joumaa and its outcome were not reviewed. The Hizballah links are allegations by US authorities and no court finding on them was found. The date of the Section 311 announcement is 10 February 2011 in the Treasury fact sheet and the SDNY release, while the finding itself is dated 9 February and was published on 17 February. Private lawsuits against SGBL and others were not reviewed.

Also known as: LCB · Lebanese Canadian Bank Section 311 action · Ayman Joumaa network · Hizballah used car money laundering case · United States v. Lebanese Canadian Bank.

What happened?

Lebanese Canadian Bank SAL (LCB) was a Beirut bank with 35 branches in Lebanon and a representative office in Montreal. FinCEN, the US Treasury’s financial crimes bureau, said it was the eighth largest Lebanese bank by assets, with more than $5 billion in 2009.

On 10 February 2011 FinCEN announced that LCB was a financial institution of primary money laundering concern, using Section 311 of the USA PATRIOT Act. It also proposed barring US institutions from holding correspondent accounts for the bank. In December 2011 federal prosecutors in Manhattan sued LCB and two Lebanese exchange houses for civil forfeiture. LCB lost its licence in September 2011 and settled the US claims in June 2013. Everything below about the scheme is what US authorities alleged.

Which techniques did it use?

FinCEN’s finding described a network linked to Ayman Joumaa, whom the US Treasury had designated as a narcotics trafficker in January 2011. It said the network moved cocaine from South America to Europe and the Middle East via West Africa, then laundered the cash.

• Cash into exchange houses. Bulk cash was deposited at Lebanese exchange houses (see currency exchanges and bulk cash smuggling). The exchange houses then deposited it into their LCB accounts.
• Wires through US accounts. The exchange houses told LCB to wire dollars through its US correspondent accounts to US used-car dealers.
• Cars as the vehicle. The dealers bought vehicles, which were shipped to West Africa, and the sale proceeds were returned to Lebanon. This is trade-based money laundering.
• A second channel. FinCEN said other funds paid Asian suppliers of consumer goods that were sold in Latin America, then laundered through the Black Market Peso Exchange.

The SDNY’s amended complaint alleged at least $329 million was wired to the United States for the used cars from about January 2007 to early 2011, mostly from LCB and two exchange houses. It said the cash from the cars and drug proceeds went to Lebanon through “Hizballah-controlled money laundering channels.” FinCEN went further on the bank’s own role, saying it had reason to believe LCB managers were complicit. Both are allegations.

How was it found?

Several US agencies worked in sequence. The Treasury’s sanctions office (OFAC) designated Joumaa’s network and three Lebanese exchange houses in January 2011. FinCEN then published its Section 311 finding in February 2011. A DEA task force investigated for the SDNY case. FinCEN’s finding gave some of the data it relied on. By value, 94% of the transfers tied to the exchange houses since January 2006 that named a Lebanese originating bank came from LCB. A review of dollar wires with the two main exchange houses from 2004 to 2008 found 72% sent by one of them through LCB.

What was the outcome?

• FinCEN, February 2011. The finding took effect immediately. A proposed rule would have barred US institutions from opening or keeping correspondent accounts for LCB. FinCEN withdrew it in 2015 because LCB no longer existed.
• Licence and sale. Lebanon’s central bank revoked LCB’s licence on 20 September 2011. Its former shareholders sold its assets and liabilities to SGBL. FinCEN said its withdrawal did not acknowledge any remedial measure by LCB.
• Civil forfeiture, 2011 to 2013. Prosecutors filed on 15 December 2011. In August 2012 they seized $150 million from a US correspondent account of Banque Libano-Française, held as a substitute for an escrow that SGBL had set up in Lebanon for the purchase.
• Settlement, 25 June 2013. LCB forfeited $102 million. To settle SGBL’s $90 million claim on the funds, LCB paid it another $12 million, and SGBL received the remaining $48 million. A June 2013 order made Hassan Ayash Exchange forfeit more than $720,000.
• Other exchange houses. In April 2013 FinCEN found Kassem Rmeiti & Co. For Exchange and Halawi Exchange Co. of primary money laundering concern. It said Rmeiti sent at least $27 million to US car dealers from 2008 to 2011 and used LCB accounts, and that Halawi sent used-car wires from 2008 to 2011, many through LCB.

What were the warning signs?

These are the indicators FinCEN and the SDNY described, as investigators would read them.

• Heavy bulk cash deposits by exchange houses, which serve customers that are hard to check.
• Concentration. One bank carrying most of the dollar wires for a group of exchange houses.
• Oddly structured wires to many US used-car dealers, some linked to drug investigations.
• A trade flow that does not fit the money. Dollars sent to US car dealers by Lebanese exchange houses, with the vehicles shipped to West Africa and the proceeds returned to Lebanon.
• Insider ties. Branch managers who were relatives of network members, and an exchange house in the same building as a key branch, according to FinCEN.
• Weak customer checks. FinCEN cited inadequate due diligence on high-risk customers such as exchange houses and failure to control cash and cross-border wires.

What changed afterwards?

LCB ceased to exist within months of the FinCEN finding, before any settlement. FinCEN’s April 2013 findings said the alleged network adapted after the US actions by moving to other exchange houses, and acted against those houses too. The 2013 settlement left claims open against other alleged participants.

The case is a standard example of how the US uses the dollar to reach a foreign bank: a Section 311 finding, an asset seizure from correspondent accounts, and a forfeiture suit. Compare the settlements at HSBC and Wachovia, a later 311 case at ABLV Bank, and see transaction monitoring and know your customer.

First published November 7, 2026 · Last updated November 7, 2026 · Legal statuses current as of November 2026