MPs Approve Law to Lift Banking Secrecy, Clearing Way for Forensic Audit

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The Parliament on Monday passed a law that lifts banking secrecy from public accounts for one year, in a move aimed at facilitating forensic audit into the Central Bank’s accounts and into the state’s institutions necessary to obtain international assistance.

Parliament Speaker had called for an end-of-year legislative session to discuss 70 items on the agenda. Several draft laws were approved during the session, most notably a bill criminalizing sexual harassment, especially at workplace.

The vote on the banking secrecy law came in in accordance with a November decision by parliament to clear hurdles obstructing a forensic audit of the central bank and public institutions.

The International Monetary Fund and France are among creditors demanding the audit as part of urgent reforms to unlock financial support, as the country faces a grinding economic crisis.

But the central bank has claimed that provisions including Lebanon’s Banking Secrecy Law prevent it from releasing some of the necessary information.

“After approving a law that lifts banking secrecy… we can begin a forensic audit,” said Hassan Fadlallah, a Hizbullah lawmaker.

But lawyer and activist Nizar Saghieh argued that Monday’s decision would only be “window dressing” in the absence of a clear intention from government to carry out the audit.

“Implementation is a whole separate matter,” he told AFP.

New York-based Alvarez and Marsal, a consultancy firm formerly tasked with the audit, scrapped its agreement with the government in November because the central bank had failed to hand over required data.

The move sparked widespread criticism of Lebanon’s authorities.

The country, which defaulted on its debt this year, is experiencing its worst economic crisis in decades and is still reeling from a devastating explosion at Beirut’s port that gutted entire neighborhoods of the capital on August 4.

The dire economic straits and the explosion have both been widely blamed on government corruption and incompetence.

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