Money Laundering and Terrorist Financing Laws in Lebanon: A Legal Overview

1. Criminalisation of Money Laundering and Terrorist Financing

Yes. Lebanon has explicit legislation criminalising money laundering and terrorist financing. These offences are governed by Law No. 44 of 24 November 2015, titled Fighting Money Laundering and Terrorist Financing. This law repealed and replaced Law No. 318 of 20 April 2001, which previously regulated money laundering offences.

Law No. 44 aligns Lebanon’s legal framework with international standards and expands both the scope of criminal liability and enforcement mechanisms.

2. Scope of Application

Law No. 44 applies broadly. It covers any individual or entity that:

• Undertakes or attempts to undertake money laundering or terrorist financing

• Incites, facilitates, intervenes, or participates in such activities

• Assists directly or indirectly in related operations

Liability applies regardless of whether the individual is a principal actor or an accomplice.

3. Prohibited Assets (“Illicit Funds”)

The law prohibits dealings in illicit funds, defined expansively to include:

• Tangible and intangible assets

• Movable and immovable property

• Legal documents or instruments proving ownership or interest

Illicit funds are those derived from the commission, attempted commission, or participation in criminal offences, whether committed in Lebanon or abroad.

4. Definition of Money Laundering

Money laundering is defined as any act committed with the intent to:

• Conceal or disguise the true origin of illicit funds

• Provide false justifications for the source of such funds

• Transfer, transport, substitute, invest, or convert funds to obscure their illegal origin

• Assist offenders in avoiding prosecution

Importantly, money laundering is a standalone offence under Lebanese law. A conviction for the underlying criminal activity is not required in order to prosecute money laundering, provided the elements of the offence differ.

5. Required Mental Element (Intent)

To establish a violation, prosecutors must demonstrate that the accused knowingly and intentionally concealed the illicit origin of funds.

Lebanese criminal law requires proof of:

• Criminal intent

• Awareness of the illegal nature of the assets

Negligence alone is insufficient; purposeful conduct must be shown.

6. Penalties

Money Laundering

• Imprisonment: 3 to 7 years

• Fine: Up to twice the value of the laundered amount

Terrorist Financing

• Imprisonment: Minimum of 7 years, with forced labour

• Additional penalties may apply under the Penal Code for related offences

7. Extraterritorial Application

Yes. Law No. 44 has extraterritorial reach.
Money laundering and terrorist financing are criminalised even if the underlying offence occurred outside Lebanon, provided the funds or conduct fall within Lebanese jurisdiction.

8. Sector-Specific Compliance Obligations

Certain sectors are subject to enhanced anti-money laundering (AML) and counter-terrorist financing (CTF) obligations, including:

• Banks and financial institutions

• Money transfer and exchange companies

• Leasing companies and card issuers

• Insurance companies

• Casinos

• Real estate dealers and agents

• Dealers in high-value goods (jewellery, precious stones, gold, works of art, antiques)

These entities must:

• Maintain transaction records above thresholds set by regulators

• Report suspicious transactions

Additionally, lawyers, notaries, and certified accountants are legally required to report suspicious activity.

9. Penalties for Non-Compliance

Failure to comply with reporting and record-keeping obligations may result in:

• Imprisonment: 2 months to 1 year

• Fine: Up to 100 million Lebanese pounds

• Administrative sanctions under the Code of Money and Credit

• Additional penalties under other applicable laws

10. Enforcement Authority

The primary enforcement body is the Special Investigation Commission (SIC), established originally under Law No. 318 and retained under Law No. 44.

The SIC is responsible for:

• Receiving and analysing suspicious transaction reports

• Conducting financial investigations

• Coordinating with judicial and international authorities

Conclusion

Lebanon’s anti-money laundering and counter-terrorist financing framework is legally comprehensive and aligned with international standards. However, enforcement effectiveness depends heavily on institutional capacity, political will, and regulatory oversight, particularly given the country’s prolonged financial crisis and reliance on a cash-based economy.