Lebanon’s top prosecutor, Ghassan Oweidat, has instructed Judge Ghada Aoun to halt the Lebanon bank investigations into the financial transactions of commercial banks, according to a letter seen by Reuters. Aoun has been investigating the banking sector since its collapse in 2019 due to years of government corruption, financial mismanagement, and excessive spending.
The move by Oweidat comes a week after caretaker prime minister Najib Mikati blocked Aoun’s investigations, claiming that they overstepped her authority. Mikati also ordered security forces not to carry out Aoun’s judicial decisions, prompting Aoun to take to Twitter to criticize the “unprecedented interference in the work of the judiciary.” Blocks into the Lebanon bank investigation are set to further increase tensions in the country.
The banks have been on strike since February 7th, following a meeting to discuss the legal measures they have faced since Lebanon’s economic crisis began. Aoun’s charges of money laundering against two banks this month further fuelled the banks’ concerns. However, they suspended their strike for a week following Mikati’s move against Aoun and have stated that they are waiting for a long-term resolution of the “deficiency” in the judiciary.
Lebanese politicians retain significant influence over judges’ appointments and prerogatives, while commercial banks also hold considerable sway. The situation has raised concerns about the independence of the judiciary and the ability of authorities to tackle corruption and financial wrongdoing. There was no immediate comment from the banks following Oweidat’s letter on Tuesday.
Lebanon bank investigation effects
The banking system has been paralyzed with most depositors frozen out of US dollar accounts since Lebanon’s financial system collapsed in 2019, marking one of the world’s sharpest ever economic meltdowns. This has led to a wave of bank raids by depositors demanding their money in recent months as a result of the country’s worsening economic crisis.