Once celebrated as the “Switzerland of the Middle East,” Lebanon has watched its institutions corrode under the weight of corruption, foreign influence, and civil strife. Recent reforms – such as the end of banking secrecy protections – offer a glimmer of hope. However, unless Lebanon’s leaders confront the most untouchable force within their borders – Hezbollah’s parallel state and illicit financial empire – real reform will remain an illusion.

In late April, Lebanon’s parliament passed a key reform granting regulatory authorities, including the central bank, greater access to bank account information. This move, aimed at unlocking a long-promised $3 billion financial package from the International Monetary Fund (IMF), allows for retrospective audits of customer accounts going back up to a decade, without requiring prior justification. On the surface, this is a vital step toward addressing decades of entrenched financial opacity and restoring international trust.

Yet Lebanon’s reality remains complicated. The banking crisis that erupted in 2019 revealed deep structural flaws: banks unilaterally froze depositors’ funds, introduced a discriminatory “fresh dollars” system (distinguishing post-2019 cash inflows from older, restricted deposits known as “lollars”), and operated with little to no accountability. Throughout this collapse, a shadow economy flourished – and none benefited more from the collapse of formal institutions than Hezbollah.

Despite the banking sector’s devastating failures, the question remains: will Lebanon’s newly expanded auditing powers be applied to Hezbollah’s financial system? Will the group’s opaque and sophisticated network – operating outside of any regulatory framework – finally face real........

© Blitz