Exposure of Hezbollah’s Money Trail Unveiled

Exposure of Hezbollah’s Money Trail Unveiled

In December 2020, Lebanon was impacted by a significant cyber breach orchestrated by a group of hackers known as SpiderZ. Almost 400,000 accounts linked to al-qard al-hasan, a semi-banking charity organization linked to the Shia community in Lebanon, were exposed. The hackers, posing as Anonymous, revealed the organization’s ties to Hezbollah, a terrorist organization, and claimed that al-qard al-hasan was an unlawful Hezbollah bank operating outside of Lebanon’s financial system.

The hackers released information on loan values, repayment ratios, personal borrower information, and the institution’s total budget for 2019-2020. They promised to reveal more in future. They even messaged customers, encouraging them to withdraw their funds and stop paying their loans. They revealed details of Hezbollah members who used the association, including Radwan Force commander Wissam al-Tawil, the head of Hezbollah’s financial unit Ibrahim Ali Daher, and the supreme leader of Iran himself, Ali Khamenei.

The association’s CEO, Adel Mansour, condemned the attack, calling it an act of treason and suggesting foreign intelligence involvement. He was also asked about Israeli attacks on the association’s branches during the Second Lebanon War, to which he replied that the association had only grown stronger.

The Al-Karch Al-Hassan Association was founded in 1982 after Lebanon’s civil war. It was initially named “The House of Muslim Finance” and aimed to encourage the Shia society to support Hezbollah and receive small scale, short term loans. Despite focusing on the Shia community, it reportedly offers services to all factions in Lebanon, including Palestinians.

The association claims its funding comes from borrower commissions, membership fees, subscription fees, and donations. It is estimated that billions of dollars pass through the bank, which has about 400,000 accounts. In 2016, it was added to the US Treasury Department’s sanctions list, but its activity has since increased.

Sanction Evasion

Al-Karch al-Hassan does not have an official website and has a Facebook page where Nasrallah praises the association’s activities and denies any connection between Hezbollah and the association. Over the years, Hezbollah has developed a network designed to evade American sanctions.

The organization’s ability to evade sanctions is linked to its control of Beirut’s airport, which enables it to transfer funds in cash and crypto. It also has extensive smuggling networks in Latin America and Africa, and is supported by various charities, business companies, and a criminal network.

Lebanese Economy

The Lebanese economy has been a significant factor in both the growth of Hezbollah and the association. The 2019 economic crisis left over 80% of Lebanese residents under the poverty line, leading to inflation and economic collapse. This was exacerbated by the COVID-19 pandemic and the Beirut port explosion in August 2020.

Al-Karch al-Hassan stepped in during this crisis, distributing food stamps, granting interest-free loans, and functioning like a bank. Many Lebanese citizens turned to the association for economic necessity rather than ideological alignment with Hezbollah.

Maintaining Legitimacy

Historically, the Shiite population was the poorest in Lebanon, and one of Hezbollah’s growth factors was the population’s need for resources and support. Hezbollah breathed new life into the community and managed the economic crisis better than other factions due to additional income sources not linked to the state.

Hezbollah’s control over Lebanon is established through its economic power in the country. It provides cheap food and medical supplies to its public, while the rest of the Lebanese population struggles financially. This has been a crucial factor in maintaining its support base.

“We Are Asleep”

The importance of economic warfare on terrorism has been highlighted through the campaign against Hamas, which exposed a vast network of costly tunnels. Dr. Udi Levy, an expert in financial warfare, argues that Israel has not done enough to combat the financial resources of Hamas and Hezbollah. He asserts that money is a critical element in both organizations’ activities and that without it, their ability to function would be severely reduced.

However, to collapse Hezbollah’s economic system, the entire economic system of Lebanon would have to be collapsed, a move that the US would not allow and Israel would not be able to do alone.