Two Maryland Businesses Used in Hezbollah Money Laundering Scheme: Feds

Used cars bought in U.S. sold in West Africa

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    NEWSLETTERS

    The federal government is taking several local businesses to court on charges they helped fund a terrorist organization. Now federal authorities are going after millions of dollars in assets. (Published Thursday, Dec 15, 2011)

    The federal government is taking several businesses to court, including two in Maryland, saying they were used to help a terrorist organization launder money, but some of the business leaders may not be aware of the terrorist connection.

    According to court documents, cocaine and used cars were sold, and portions of the money was funneled to Hezbollah, an organization founded in 1982 and recognized by the United States, Canada, the United Kingdom and Israel as a terrorist organization.

    The cocaine came from Colombia, according to the Drug Enforcement Agency, and some of the used cars came from Columbia, Md., car buyer ARZ Export LLC, News4’s Derrick Ward reported. Hijazi General Trading LLC in Burtonsville also was among the U.S. businesses used in the money laundering scheme.

    “The idea was to get the money into the banking system in Lebanon,” Special Agent Derek S. Maltz said. “So we followed the money and we watched the money flow from exchange houses in Lebanon through the Lebanese Canadian Bank into these businesses in the United States. So we’ve identified approximately 30 businesses operating in the United States with the purpose of buying cars and selling the cars in West Africa for a profit.”

    Forty-three wires totaling $2,157,047 were sent to ARZ Export and 193 wires totaling $7,150,253 went to Hijazi General Trading, according to court documents.

    Proceeds from the sale of the cars and cocaine in West Africa were sent back to Lebanon, according to court documents. A significant portion of the money went to Hezbollah, Ward reported.

    “Terrorists are turning to criminal networks for the funding, so we in the DEA have recognized that if drugs are generating $400 billion a year around the world, and as state sponsorship of terrorism is declining, terrorists fueled by drug trafficking is on the rise,” Maltz said.

    In a lawsuit filed in Manhattan Monday, the U.S. government is seeking almost $500 million in money laundering penalties from the U.S. car buyers and Lebanese financial entities.

    Federal authorities say that while the law has the right to seize the assets of businesses that were knowingly or unknowingly involved, they do not believe that the car dealers in Maryland knew these transactions supported Hezbollah.

    Ayman Joumaa, a Lebanese national who U.S. authorities said is the kingpin of the drug smuggling ring, was indicted but remains at large. The indictment in federal court in Alexandria alleges he led a conspiracy that, among other activities, sold almost 100 tons of Colombian cocaine to the Zetas drug cartel in Mexico between 2005 and 2007 that was ultimately smuggled into the United States. The conspiracy has run since at least 2004 and at times brought in as much as $200 million in a single month, according to court documents.

    Earlier this year, the Treasury Department designated Joumaa as a drug trafficker and said Hezbollah profited from his network. Treasury accused the Lebanese Canadian Bank of being complicit in Joumaa's money laundering and turning a blind eye to massive cash transactions. One of the members of Joumaa's network is a suspected Hezbollah supporter, and bank managers had links to Hezbollah officials, according to the Treasury Department's findings. The criminal indictment itself makes no mention of links between Joumaa, 47, and Hezbollah, which the U.S. government has designated as a terrorist group since 1997.

    The Lebanese Canadian Bank was sold to an affiliate of France's Societe Generale in March to restore confidence after those accusations triggered concerns in Lebanon that the U.S. would begin targeting Lebanon's banking sector as a way to exert pressure against Hezbollah, the Associated Press reported.