The Special Investigation Commission (SIC) is a multi-function financial intelligence unit (FIU) with judicial status. It is the center piece of Lebanon’s AML/CFT regime, a platform for international cooperation and plays a vital role in safeguarding concerned sectors from illicit proceeds.
The SIC’s tasks include receiving and analyzing suspicious transaction reports (STRs), conducting financial investigations, lifting banking secrecy, freezing accounts and/or transactions and forwarding them to concerned judicial authorities.
With respect to terrorism and the financing of terrorism, the SIC is also empowered to prevent the use of movable or immovable assets. In addition to sharing ML/TF intelligence with counterparts and coordinating with foreign/local competent authorities on requests of assistance (ROAs), the SIC also proposes AML/CFT regulations and issues regulations and recommendations to concerned parties.
AML/CFT supervision via risk based compliance examinations that cover banks and other reporting entities to ensure proper implementation of prevailing regulations is also among its tasks.
Law No. 44 criminalizes illicit proceeds that are derived from the following offences:
1. The growing, manufacturing, or illicit trafficking of narcotic drugs and/or psychotropic substances according to the Lebanese laws.
2. The participation in illegal associations with the intention of committing crimes and misdemeanors.
3. Terrorism, according to the provisions of Lebanese laws.
4. The financing of terrorism or terrorist acts and any other related activities (travel, organizing, training, recruiting…) or the financing of individuals or terrorist organizations, according to the provisions of Lebanese laws.
5. Illicit arms trafficking.
6. Kidnapping, using weapons or any other means.
7. Insider trading, breach of confidentiality, hindering of auctions, and illegal speculation.
8. Incitation to debauchery and offence against ethics and public decency by way of organized gangs.
9. Corruption, including bribery, trading in influence, embezzlement, abuse of functions, abuse of power, and illicit enrichment.
10. Theft, breach of trust, and embezzlement.
11. Fraud, including fraudulent bankruptcy.
12. The counterfeiting of public and private documents and instruments, including checks and credit cards of all types and the counterfeiting of money, stamps and stamped papers.
13. Smuggling, according to the provisions of the Customs Law.
14. The counterfeiting of goods and fraudulent trading in counterfeit goods.
15. Air and maritime piracy.
16. Trafficking in human beings and smuggling of migrants.
17. Sexual exploitation, including sexual exploitation of children.
18. Environmental crimes.
21. Tax evasion, in accordance with the Lebanese laws
Money-laundering operations may occur in any business especially:
· Other financial institutions (insurance, mutual funds, etc.)
· Money exchange firms
· Antique dealers
· Real estate concerns
· Jewelry dealers
Money laundering is an illegal act intended to conceal the source or use of illicit funds, by converting cash into untraceable bank transactions. The process goes through three main stages:
· Placement: the launderer introduces the illegal proceeds into the financial system.
· Layering: the launderer engages in a series of operations on the illicit funds movements, in order to distance them from their source. This involves using different channels that make reverse tracing impossible.
· Integration: the funds re-enter the formal financial system, and the launderer can invest the funds in any business of high-value assets