Lebanese Ministry of Information
State Prosecutor Ghassan Oueidat suspended Thursday an order to freeze the assets of 21 Lebanese banks, warning it would plunge the country and its financial sector into chaos.
Oueidat said international financial authorities had intended to halt dealings with Lebanese banks, without giving further details.
Earlier Thursday, a judge stunned Lebanon with a decision to freeze the assets of 21 banks for what he said was a violation of the money and credit law and undermining the rights of the small customers.
In light of this decision, a meeting was held between Oueidat and the Association of Banks to discuss the decision.
Oueidat also held a separate meeting with Financial Attorney General Ali Ibrahim to review his decision concerning the freezing of the assets of the 21 bank, their CEOs and board members.
The Association of Banks in Lebanon held an emergency meeting to review the ramification of this decision but sources at ABL told The Daily Star there would not be a strike Friday to protest Ibrahim’s action.
“The banks will remain open tomorrow. There is no decision on the course of action we will take. We have to wait for the coming few days,” the source said.
Sources close to ABL said a delegation from the association contacted President Michael Aoun and Oueidat to revoke the decision of the judge.
These sources said that Oueidat planned to freeze Ibrahim’s decision under the pretext that this step did not meet all legal requirements.
Several politicians have denounced Ibrahim’s decision, arguing that the step threatens the Lebanese financial system.
Former Prime Minister Saad Hariri was among the politicians who voiced his rejection of this decision.
“The decision of the Financial Attorney General Ali Ibrahim is a populist political message that does not take into consideration the outcome, either on the level of the rights of depositors, young and old, or on the level of the trust of friends of Lebanon,” Hariri said in a tweet.
Earlier, Ibrahim told The Daily Star that the banks committed serious violations in money and credit law and for this reason the judges decided to freeze the assets of the bankers.
“We have investigated the 21 banks for several days and discovered that the lenders did not treat the customers properly and did not even allow them to withdraw their savings. The arguments of the banks was not convincing and for this reason seven judges who studied these files extensively decided to take this decision.
Ibrahim ordered the freezing of the assets of 20 Lebanese banks and to inform this decision to the Directorate General of the Real Estate, real estate registration department, the vehicle and traffic department, the Central Bank, the Association of Banks in Lebanon the Financial Market Authority.
Ibrahim also prohibited the chairmen of the banks, board of directors and general managers from touching these assets.
“This is a judicial decision and I have to stick to it. Banks are obliged to abide by the laws and especially regarding money and credit law,” Ibrahim explained.
The judge stressed that the decision did not require the permission of Central Bank Governor Riad Salameh.
“The bankers know that they made mistakes and they need to fix these mistakes,” Ibrahim said.
But the judge assured that his decision had nothing to do with the issue of transferring money abroad or selling the Eurobonds to foreign investment companies.
“These files are being handled by State Prosecutor Oueidat and not me,” Ibrahim said.
The Association of Banks in Lebanon are holding an emergency meeting Thursday to discuss the actions against banks amid some reports that ABL may call for two day strike to protest the decision.
The Daily Star
