Lebanon’s Former Central Bank Chief Riad Salameh Arrested Over Alleged Financial Crimes, Reports Reuters

By Laila Bassam, Timour Azhari, and Maya Gebeily

BEIRUT – Riad Salameh, the former central bank governor of Lebanon, was arrested on Tuesday in Beirut amid allegations of financial misconduct linked to a brokerage firm. This marks his first arrest following years of accusations both domestically and internationally.

At 73 years old, Salameh had a 30-year tenure as governor, but his final years were overshadowed by claims of financial crimes, including illicit enrichment from public funds, brought against him by Lebanese authorities and several Western nations.

Reports indicate that Salameh is accused of illegally obtaining over $110 million through financial crimes connected to Optimum Invest, a Lebanese brokerage firm. The specific charges resulting in his arrest are said to include embezzlement, money laundering, and fraud, which are tied to commissions from the central bank’s transactions with Optimum from 2015 to 2018.

Salameh and his legal counsel did not immediately respond to requests for comments, although he has previously denied any wrongdoing. He is currently being held for four days as a precautionary measure before his case is forwarded to the public prosecutor in Beirut.

Reine Abboud, CEO of Optimum, stated that the company learned of the arrest through the media and was not present at the hearing. Abboud directed attention to a statement from the company indicating that a financial audit conducted in late 2023 found no evidence of wrongdoing in their dealings with the central bank.

The recent allegations are distinct from previous accusations related to Forry Associates, a company run by Salameh’s brother, Raja, which had been implicated in diverting $330 million in public funds through commissions. Both brothers deny any allegations of misconduct.

Despite facing legal challenges in Lebanon, including arrest warrants from France and Germany as well as an Interpol Red Notice, Salameh had not previously been apprehended. Should this case proceed, it could represent a rare instance of Lebanese authorities holding a prominent figure accountable, in a system often criticized for protecting the elite.

Caretaker Prime Minister Najib Mikati stated that the government would not interfere in the judicial process. Throughout his career, Salameh worked closely with Lebanon’s political leaders, leading many to question whether the judiciary, heavily influenced by political ties, would conduct a thorough investigation.

Salameh’s arrest occurred following a hearing regarding the central bank’s dealings with Optimum Invest. The firm was involved in trading treasury bonds and certificates of deposit in a manner that generated significant profits.

Lebanon’s caretaker justice minister, Henry Khoury, acknowledged that he lacked details on the case but affirmed that the Public Prosecutor had acted appropriately in interrogating Salameh.

After taking over the central bank post-civil war, Salameh was initially viewed as a capable administrator and potential presidential candidate. However, following his departure, he faced sanctions from multiple countries, including the United States, the UK, and Canada, which accused him of engaging in corrupt practices to benefit himself and his associates—accusations he has denied.

His fall from grace parallels the collapse of Lebanon’s financial system, which occurred five years ago. The country is currently facing an assessment by a financial oversight body that may lead to increased scrutiny on its practices.

A notable concern raised by the Financial Action Task Force is the lack of judicial action on alleged financial misconduct. Some diplomatic and judicial sources view Salameh’s recent arrest as a potential effort to demonstrate to FATF appraisers that steps are being taken to address these issues.