US sanctions Lebanese consulting firm 'directed by Hezbollah'

18 September 2020 4 min. read

The United States has imposed far-fetching sanctions on Arch Consulting, a Beirut-based engineering consulting firm. 

According to the Office of Foreign Assets Control (OFAC) of the Department of the Treasury, which announced the sanction yesterday, Arch Consulting is “owned, controlled, or directed by Hezbollah” without specifying further details. 

Contrary to most European governments, which consider Hezbollah a political party (the group has a seat in Lebanon’s parliament and is part of the ruling government coalition), the US considers the Iran-backed Hezbollah a terrorist organisation. Having imposed sanctions on many of the militant group’s officials in the past, the US has in recent weeks stepped up its game in the wake of the devastating blast in Beirut’s port.

Many in the country have accused Hezbollah of mismanagement of the port, an area the group to a large extent controls. Meanwhile, the US also accuses Hezbollah of terrorist activities, as well as corruption, money laundrering and a host of other illicit activities. 

US sanctions Lebanese consulting firm 'directed by Hezbollah'

OFAC believes Arch Consulting is being leveraged to “conceal money transfers to Hezbollah's own accounts, further enriching Hezbollah's leadership and supporters, and depriving the Lebanese people of much-needed funds,” the Office said.

Founded in 2000, Arch Consulting helps its clients with architecture, engineering, technical consultancy, project management and construction supervision services. The firm has been involved with several high-profile projects in Lebanon, including working with the United Nations on improvements to Palestinian camps, and the construction of the Saiidi Municipality Palace, the Borj El Brajneh Social and Medical Center, and the Red Cross headquarter in Balback.

Notably, Arch Consulting is ISO certified, and has bagged several awards for its services from the Lebanese Ministry of Public Works & Transportation and private sector organisations.

In parallel to imposing sanctions on Arch Consulting, OFAC also blacklisted Meamar Construction, and Sultan Khalifah Asaad, who allegedly is a senior Hezbollah Executive Council official who provided project guidance to the companies. 

The sanction sees all US assets of the two companies and Sultan Khalifah Asaad frozen and generally bars US-based companies and Americans from dealing with them. Business or people that do engage with the entities run the risk of being hit with secondary sanctions, said Treasury Secretary Steven Mnuchin in a statement. 

The move comes shortly after the US sanctioned two former Lebanese Cabinet ministers allied with Hezbollah – Ali Hassan Khalil (the ex-finance minister, currently a lawmaker) and Youssef Fenianos (the former public works and transportation minister). They were accused of conspiring with Lebanese officials to direct government contracts to the companies that are overseen by Hezbollah, and of accepting bribes for their role. 

“The United States remains committed to targeting Hezbollah and its supporters as they corruptly abuse Lebanese resources to enrich their leaders while the Lebanese people suffer from inadequate services,” said Mnuchin. 

“More decisive action”

Meanwhile, US President Trump has urged Europe to take “more decisive action” against Hezbollah, he said in a recent speech, claiming that Europe is shutting its eyes for the risks of a potential terrorist attack. Unpacking on the statement, Nathan Sales, the department’s counterterrorism coordinator, said that US intelligence has uncovered caches of weapons and ammonium nitrate owned by Hezbollah in Europe. 

“I can reveal that such [Hezbollah weapons] caches have been moved through Belgium to France, Greece, Italy, Spain and Switzerland. I can also reveal that significant ammonium nitrate caches have been discovered or destroyed in France, Greece, and Italy,” Sales said in a video appearance for a US-based advocacy group. 

“Hezbollah sees Europe as a vital platform for its operational, logistical, and fundraising activities. And it will continue to do so until Europe takes decisive action, as the UK and Germany have both done,” added Sales, pointing at the fact that the UK and Germany earlier this year both named the entire organisation [its military and political win] a terrorist entity.

With more sanctions expected in the coming weeks, the US continues to lobby for other European governments to follow suit.