The United States and United Kingdom on Tuesday (April 18) took action against an international network dealing in luxury goods that allegedly has sought to evade sanctions and launder money for a blacklisted Hizbullah operative.
Per an indictment unsealed Tuesday by a US court, Lebanese art dealer Nazem Said Ahmad, who is already under US sanctions, has used a complex web of business entities to avoid sanctions for the benefit of Hizbullah.
Ahmad, 58, a dual Belgian-Lebanese citizen, resides in Lebanon. According to the indictment, a Ugandan passport bearing his photograph was previously issued under another name.
In December 2019 Ahmad was blacklisted for being one of Hizbullah's top donors and for trading in "blood diamonds" -- gems that are sold to fuel wars.
Ahmad and eight others are charged with conspiring to defraud the United States and foreign governments, launder money and evade sanctions and customs laws, according to the nine count, 70-page indictment.
They had relied on an international network of business entities -- sanctioned Tuesday by the US Treasury -- to obtain valuable artwork from US artists and art galleries and to secure US-based diamond-grading services, it said.
"Entities controlled by or operating for the benefit of Ahmad engaged in more than $400 million worth of financial transactions between approximately January 2020 and August 2022," per the indictment.
About $160 million worth of artwork and diamond-grading services were funneled through the US financial system, it said, with at least $6 million of the scheme's proceeds transferred to Lebanon for use by Ahmad and his associates.
The US Treasury on Tuesday blacklisted the international network of 52 individuals and entities that facilitated the payment, shipment and delivery of luxury goods for Ahmad's benefit.
The designation of the money laundering and sanctions-evasion network was a part of a co-ordinated action with the US Department of Homeland Security, the State Department's Rewards for Justice programme, and the United Kingdom.
The United Kingdom froze Ahmad's assets on Tuesday on national security grounds, effectively barring him from trading in the UK art market.
Ahmad reportedly has an extensive art collection in Britain and conducts business with UK-based artists, galleries and auction houses.
According to the US Treasury, the network operated out of Lebanon, the United Arab Emirates, South Africa, Angola, Côte d'Ivoire, the Democratic Republic of the Congo, Belgium, the United Kingdom and Hong Kong.
The individuals and their associated companies involved in the network had helped Ahmad evade US sanctions "to maintain his ability to finance Hizbullah and his luxurious lifestyle", it said.
Since 2012, the Treasury said, Ahmad has acquired over $54 million in works of art from major auction houses, galleries, exhibitions and artists' studios.
Many works from Ahmad's collection were displayed in his Beirut penthouse.
Shell companies, fraudulent schemes
"The individuals involved in this network used shell companies and fraudulent schemes to disguise Nazem Said Ahmad's role in financial transactions," said US Treasury official Brian Nelson.
Key facilitators include Ahmad's son Firas, who handles his father's business affairs in South Africa, and daughter Hind, who runs galleries in Lebanon and Côte d'Ivoire, along with other relatives and business associates.
"Luxury good market participants should be attentive to these potential tactics and schemes, which allow terrorist financiers, money launderers and sanctions evaders to launder illicit proceeds through the purchase and consignment of luxury goods," Nelson said.
Ahmad is accused not just of funding Hizbullah, which has been proscribed as a terrorist organisation by the United States, United Kingdom and a growing number of countries, but also of personally providing funds to its leader, Hassan Nasrallah.
In a separate action on Tuesday, the US Department of State's Rewards for Justice programme announced a reward of up to $7 million for information on key Hizbullah leader Ibrahim Aqil, also known as Tahsin.