Forum in Lebanon warns against cash economy impact on banking sector

The Annual Forum of Combating Money Laundering and Terror Financing warned on Thursday against the repercussions of cash economy on the banking sector. Speaking at the opening of the two-day forum, Acting Governor of the Bank of Lebanon Wissam Mansouri said boosting cooperation amongst Arab banks to face economic challenges was a must, stressing that the economic woes felt by Lebanon in recent years had affected the confidence of depositors in the banking sector. The lack of confidence had diverted economic activities away from the banking sector and led to the prevalence of the cash economy, which threatens all through acts of money laundering and other questionable actions, said Mansouri. Lebanon continues its efforts to avoid being put on the "gray list", which would affect banking operations and would led to more illicit activities, he added. He stressed Lebanon's need to find a collaborative plan gathering several national entities to bolster money policies and help prevent whitewashing and funding terrorism. On his part, the chairman of the executive council of Union of Arab Banks (UAB) Joseph Torbey affirmed that counter money laundering and funding terror was a global issue that requires cooperation amongst all countries. Arab banks' sponsoring of forum and dialogue with international banking entities was essential to create a strategic coalition to counter illicit acts, he affirmed. Touching on the Lebanese economic crisis, he said that proliferation of cash economy was a threat to the country, noting that the World Bank indicated that such economy had jumped in Lebanon from USD 9.9 billion in 2022, which is about 45 percent of the Gross National Product. Meanwhile, the Secretary General of the Special Investigation Commission in Lebanon Abdul Hafeez Mansour said that cash economy led to several worrisome consequences including inability to carry out large monetary transactions, increase circulation of forged currencies and increase in whitewashing. Former Economic Minister Alan Hakim told KUNA that his participation in the forum was to find solutions and combat money laundering and funding of terror through the increase use of cash economy. The woes facing the economic sector in Lebanon, namely banking, must come through regaining confidence of the public and decreasing the impact of cash economy, he affirmed. Source: Kuwait News Agency