Lebanon's “Madoff” : A Divine Bankruptcy
By Elias Bejjani

September 21/09

08/09/09 Al Manar Hezbollah website: “On the businessman, Salah Ezzeddine’s, bankruptcy case,  Sayyed Hassan Nasrallah pointed out that Hezbollah Party, its leadership and the organization had no association whatsoever with this issue from the beginning to the end, stressing that the leadership does not have any of the money claimed. He added that the aim of several media facilities which have shed light on this issue that is in the hands of the judiciary is to tarnish the image of many of the party’s cadres. Sayyed Nasrallah stated  that his party is in the process of issuing a detailed release on this sensitive issue that affects the people's money”.

No matter how hard Sayyed Nasrallah or other Hezbollah mullahs try to camouflage, hide, justify, deny or twist facts, the bitter reality shows that an actual devastating financial earthquake has severely hit the Lebanese Shiite community in Lebanon and abroad. This shocking disaster took place earlier this month after the famed Lebanese Shiite financier, Salah Ezzeddine, filed for bankruptcy and was placed under arrest.

From wealthy Lebanese Shiite expatriates in the Arabian Gulf oil countries, Africa, USA, Canada, Australia, Europe and other countries, to local villagers all over Lebanon, to top notch Hezbollah clergy, officials and MPs, Ezzeddine spared no one as he allegedly concocted a Ponzi scheme that saw almost USD 2 billion go up in smoke.

Tagged as “Lebanon's Bernard Madoff”, Ezzeddine made headlines earlier this month in the local and international press. His dubious bankruptcy has left many serious unanswered questions, all related to his very cozy and privileged relationship with the terrorist organization, Hezbollah. A shroud of mystery still surrounds the whole matter. 

Any sane Lebanese citizen who has a free conscience and is familiar with the unfolding events in his country would take Nasrallah’s statement above as a personal insult to his intelligence and a flagrant infringement on the plain truth. There is no doubt that Nasrallah has turned a blind eye and a deaf ear to the simple fact that the majority of his Shiite community members are fully aware of the kind of intimate and very close relationship that Ezzeddine enjoyed with Hezbollah and its high ranking leadership, including Nasrallah himself, as well as his close associates.

The Kuwaiti Al-seyassah daily reported on September 05/09 that Nasrallah himself and some of his family members were investing USD 2 million in Ezzeddine's businesses. According to the Lebanese media three other senior Hezbollah operatives were also among those who invested and lost funds with Ezzeddine. One of the three is Wafik Safa, chief of internal security. The other two as reported by Al-Arabiya were the leader of Hezbollah's parliament bloc, Mohammad Raad, and a member of the bloc, Amin Sherri. The report did not say whether they had lost their own private funds or those of the organization. Sources affiliated with Hezbollah have estimated Ezzeddine's losses at around USD 1 billion, and a Kuwaiti daily reported that the organization had lost USD 683 million.

A report published on September 12/09 also by the Kuwaiti Al-seyassah daily said that many senior political and military Syrian officials had lost huge amounts of money with Ezzeddine's bankruptcy, and that they are now trying to recover a portion of it from the Hezbollah. The report stated that Hezbollah had collected about EUR 17 million from Ezzeddine before he was handed over to the Lebanese judiciary.  According to the same report, the Syrian president's brother, Maher Assad, his uncle's sons, Rami Hafez Makhlouf, Vice President Faruq al-Shara,  Major General Mohammed Nassif, Maj. Gen. Rustom Ghazali, the family of the late Maj. Gen. Ghazi Kanaan, in addition to a number of senior army and intelligence  officers had all invested with Ezzeddine and had lost their money.  It is interesting to know that USD 200 thousand was the minimum amount of money that Ezzeddine would accept for investment. 

According to anonymous Lebanese neutral financial and sociology experts' assessments that were based on actual facts and firsthand experience, Hezbollah was the sole predisposing and precipitating evil vehicle that stood behind Ezzeddine's scheme from day one until its deadly end. They all concluded that Hezbollah is to be solely blamed for the tragedy due to the simple fact that this armed Iranian militia fully controls the Shiite canton and runs its affairs with an iron fist. Nothing at all happens inside this canton without Hezbollah's approval and full awareness.  

The worst part of the scandal for the Hezbollah party might not come in only dollars and cents but in the damage done to its faked and disguised reputation for honesty, competence and integrity especially among its own Shiite community. Journalist Ali Halawi in a report published by the Elaph website on September 16/09 said: “It seems that Hezbollah from the top of its hierarchy represented by its Secretary General, Sayyed Hassan Nasrallah, has made a serious decision to contain Ezzeddine's bankruptcy, which is described as very closely linked to the party. The bankruptcy is causing a great deal of  embarrassment to the Hezbollah party due to the fact that a significant number of its political and security officials are among the thousands of Shiite depositors who invested their money in Ezzeddine's projects for annual profits that reached around 40 percent. In parallel with the decision of containment, some clerics in the party have issued a special religious decree (very close to a Fatwa) forbidding anyone to mention or relate the party to the bankruptcy under any circumstances in a bid that Israeli and American propaganda would not tarnish the party's reputation”.  

Based on Hezbollah's suffocating grip on the canton's, residents, security, banks, media, schools, hospitals, communications, life style, businesses, and worship facilities, there is no way at all that Ezzeddine would have been able to run his very sensitive money business for so many years without not only the approval of Hezbollah, but also without being a member in this very rich organization. Numerous reports even claimed that Ezzeddine was investing for Hezbollah and not for himself. 

It worth mentioning that Hezbollah does not approve or believe in the banking system of earning interest and considers it religiously unlawful. Instead its leadership and clergy advocate what they call a “business partnership”. Ezzeddine was using this religious doctrine and smartly manipulating it to his advantage. All those who put their money in his coffer presumably considered themselves partners in his investments. Ezzeddine was promising his so called “partners” annual returns of 40 to 50 percent. 

More than 11 thousand Lebanese Shiites were hit by Ezzeddine's bankruptcy . Many of them can’t sue him or even file publicly for their losses because they live in countries like Canada, Australia and the USA where tax departments would expose them to very tough financial monitoring if their loses were officially declared.  A Lebanese daily has stated that a Shiite family residing in Canada that had invested with Ezzeddine alone lost more than USD 1 million. According to the report, this family doesn’t even have a receipt from Ezzeddine for their money.
Meanwhile, many prominent Hezbollah members are also afraid to fully admit their losses to avoid questions about the origins of their questionable wealth.

Members in the Lebanese Shiite community placed their life savings with Ezzeddine because of his close connections with Hezbollah, which thus bears at least a moral responsibility for the bankruptcy scheme. The prominent outspoken Lebanese Shiite politician, Ahmad Alassad , blamed Hezbollah for the bankruptcy scheme. The Lebanese National News agency published his statement on September 11/09: "Ahmad Al Assad stressed Hezbollah's responsibility with regard to Ezzeddine's bankruptcy because he had a close relationship with them. Accordingly he said, “it is a crime if the party knew that his activities were wrong and kept silent. At the same time the party is accountable too if it did not know and did not carry out any kind of investigation to trace the sources of the high interest that he was paying to the investors. It is obvious that this man has invested in his relationship with Hezbollah to cover up his activities and to give the impression that he was supported by Hezbollah. Therefore Hezbollah's obligation was to carry out a probe into his activities at least for the benefit of the people for whose interests it claims to work”.

On September 14/09, Ezzeddine who has been under arrest since August 31/09, was  formally charged by the Lebanese judiciary with fraudulent embezzlement, a crime, if found guilty, punishable for up to 15 years in prison. Five others have also been charged with involvement in the case, but all of them are on the run.

It is so sad, disappointing and frustrating for all of Ezzeddine's victims that because of Hezbollah's questionable and suspiciously friendly relationship with him, his bankruptcy case most probably will not proceed anywhere in the Lebanese  judicial system, and he might even be found to be innocent, and subsequently not charged and released.  

Hezbollah's role, intimidation and influence in the bankruptcy scandal are very obvious. This intimidation role is extremely noticeable in the fact that not even one investor from the 11 thousand Shiites that were hit did file a judiciary complaint against Ezzeddine yet.

Why? Because Hezbollah's mini state actually controls and runs the central Lebanese state and all its institutions by terrorism, crime, embezzlement, and corruption.

In conclusion, Lebanon will never be able to reclaim its independence, freedom, and sovereignty until Hezbollah is finally dismantled and disarmed, and whoever has ears to hear ought to hear.

Elias Bejjani
Canadian-Lebanese Human Rights activist, journalist and political commentator
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