Hezbollah using honorary consuls to smuggle, launder funds - report

Hundreds of honorary consuls were found to have abused their diplomatic privileges across the world, according to a new report.

A Hezbollah flag and a poster depicting Lebanon's Hezbollah leader Sayyed Hassan Nasrallah are pictured along a street, near Sidon, Lebanon July 7, 2020 (photo credit: REUTERS/ALI HASHISHO)
A Hezbollah flag and a poster depicting Lebanon's Hezbollah leader Sayyed Hassan Nasrallah are pictured along a street, near Sidon, Lebanon July 7, 2020
(photo credit: REUTERS/ALI HASHISHO)

Hezbollah has used special diplomats known as "honorary consuls" to smuggle and launder cash, according to an investigation published by the International Consortium of Investigative Journalists (ICIJ) and ProPublica on Monday.

Honorary consuls are private citizens, such as businesspeople, celebrities and former politicians, appointed by their governments to serve their interests in foreign countries and are afforded some of the privileges that career diplomats receive. For instance, their archives and correspondence cannot be seized and cargo belonging to them is protected from searches. Honorary consuls also often receive special ID cards, passports and license plates and even a form of diplomatic immunity.

While the system was originally meant to provide poorer countries with a way to have diplomatic representation without having to fund an embassy, these privileges have been abused by hundreds of appointees to easily commit crimes and finance terrorism, according to the investigation.

There are even online consultants who promise to deliver honorary consul appointments for tens of thousands of dollars in fees.

“It’s just amazing that you can become the honorary consul tomorrow if you want to and you’re willing to pay the money,” said Bob Jarvis, an international and constitutional law professor at Florida’s Nova Southeastern University, to ICIJ and ProPublica. “People buy these things or get them as a reward for supporting a political candidate, and people have no idea what they are supposed to be doing. And no one is busy checking them out.”

 A money exchange vendor displays Lebanese pound banknotes at his shop in Beirut, Lebanon, June 11, 2021. (credit: MOHAMED AZAKIR/REUTERS) A money exchange vendor displays Lebanese pound banknotes at his shop in Beirut, Lebanon, June 11, 2021. (credit: MOHAMED AZAKIR/REUTERS)

At least 500 current and former honorary consuls were found to have been accused of crimes or embroiled in controversy, according to ICIJ and ProPublica. That number is likely higher, but a lack of transparency from many countries makes it difficult to identify who is serving as an honorary consul.

Nine current and former honorary consuls identified by the investigation have been linked to terrorist groups, mostly to Hezbollah.

“Hezbollah has realized that if they use these honorary consuls … they can basically move stuff with impunity and no one is ever going to bust them — you flash your diplomatic passport, no questions asked,” said David Asher, a former senior counterterrorism finance adviser for the Department of Defense assigned in 2008 to help oversee a federal investigation of Hezbollah’s criminal network, to ICIJ and ProPublica. “It’s a huge seam in our international law enforcement capabilities sweep.”

Hezbollah financier sanctioned by US served as honorary consul for Gambia

Retired Drug Enforcement Administration supervisory special agent Jack Kelly, who was helping to lead a US federal operation called Project Cassandra to dismantle Hezbollah's criminal empire, told the news agencies how he first uncovered the terrorist organization's abuse of the honorary consul system in late 2008.

The agent studied contacts on a phone used by a Hezbollah envoy who was suspected of helping to advance Iran's nuclear and ballistic missile programs, before focusing on a phone number belonging to Mohammad Ibrahim Bazzi.

Kelly and Asher believed that Bazzi was a top financier of Hezbollah and was laundering illicit funds through his companies in Lebanon and Africa. Bazzi was a petroleum importer in Gambia and an associate of then-president Yahya Jammeh. While investigating Bazzi's criminal activities, Kelly discovered that he had been appointed as an honorary consul by the Gambian government in 2005.

Bazzi was designated as a Hezbollah financier and sanctioned by the US in 2018. His son was sanctioned a year later for allegedly working on his father's behalf. The US is offering a reward of up to $10 million for information concerning Bazzi and his financial activities for Hezbollah.

Hezbollah offered honorary consulships as a way to smuggle weapons

Honorary consuls were linked to the terrorist group again when "buyers" who were actually DEA informants met with Faouzi Jaber, a Hezbollah-affiliated arms broker, in Ghana in 2012. The buyers told Jaber that they needed weapons to fight against America, to which Jaber responded "Hezbollah sells."

Jaber offered the buyers honorary consulships, saying "All the high people, all the rich people, [are] all consular."

“The best is Africa. Many European white men work as [consuls] from their home countries when there are no embassies nearby," added Jaber in a later meeting. "We go to any country in Africa. We make you consul of Equatorial Guinea [or] Guinea-Bissau. … You pay 200,000 dollar[s].You are the consul official of the country. And you have other passport.”

In 2014, Kelly flew to Prague to ensure that Jaber, an associate named Khaled el-Merebi and a Lebanese-born arms dealer named Ali Fayad, were taken into custody. Merebi and Fayad were later released by the Czech government in a reported exchange for five Czech nationals kidnapped in Lebanon.

Jaber had promised to supply surface-to-air missiles, assault rifles and grenades, as well as to move and store cocaine in West Africa and launder the proceeds through bank accounts in New York. He was extradited to the US and pleaded guilty in 2017 to conspiring to support a Colombian terrorist group.

Meanwhile, New Jersey attorney Gary Osen found references to honorary consuls who had been linked to Hezbollah's finance networks while investigating Hezbollah's campaign against US service members in Iraq, according to ProPublica and ICIJ.

“Everybody who is a big shot in that world is an honorary consul,” said Osen. “It is not necessary to their operation. But it is a further lubricant.”

Osen filed a lawsuit in 2019 on behalf of over 1,000 Americans, accusing 13 Lebanese banks of violating anti-terrorism laws by knowingly managing and moving money for Hezbollah during deadly attacks linked to Iran and Hezbollah in Iraq.

Fransabank, one of the banks listed in the lawsuit, was acquired by Adnan Kassar and his brother, Adel, who has served as the bank's deputy chairman and CEO and has been Hungary's honorary consul in Lebanon, according to records obtained by ICIJ and ProPublica. Bazzi also held an account at the bank and an additional bank listed in the lawsuit.

Honorary consulships used as a sign of status by Hezbollah

Hezbollah uses honorary consulships as a sign of status, according to the investigation. “It’s something like lordships in the British system,” said Mohanad Hage Ali, a senior fellow at the Carnegie Middle East Center in Beirut. “If you have a connection to another sovereign state, whether you know the president or someone in his entourage, you get this honorary consul title. It’s one Lebanese way of saying, ‘I’m important.’”

Ali Myree, a Lebanese businessman and hotel operator, was appointed by South Sudan as an honorary consul in Lebanon. He had been arrested while living in Paraguay in 2000, reportedly for selling millions of dollars in counterfeit software and funneling the proceeds to Hezbollah. Myree has denied ever having a relationship with any terrorist organization.

Ali Saade, a successful businessman in Guinea, was named by the country as its honorary consul in Lebanon. Earlier this year, Saade was accused by the US of being a key Hezbollah financier, as was Ibrahim Taher, who serves as an honorary consul for Lebanon in Cote d'Ivoire. Both Taher and Saader have been sanctioned by the US. Saade has denied providing funds to Hezbollah.