Unsolved murder of ‘diligent’ financier chills Lebanese bankers

At approximately 7 a.m. on a June day last year, veteran banker Antoine Dagher left home for one of Lebanon’s largest banks, his employer for the past 20 years. But the head of Byblos Bank’s anti-fraud and ethics department never came.

A few hours later, Dagher’s wife found his body on the ground next to his gray Honda near their home in Hazmiyeh, an exclusive suburb minutes from downtown Beirut. He had been stabbed five times.

A year later, the unsolved murder of the father of two looms over Lebanon’s once prestigious banking industry. In a police report seen by the Financial Times, investigators said nothing had been stolen, but did not identify the motive and did not charge anyone.

With no clear answers available, many bankers have come to what they see as a foregone conclusion: His murder is related to his job. Lebanon’s banks are being targeted by protesters angry at their role in the country’s financial crisis and by customers unable to withdraw their cash. “It was scary and shocking,” said one of Dagher’s former colleagues. “And so far, we don’t understand anything.”

Antoine Dagher had been head of compliance at Byblos Bank, a ‘risky business’, according to a former regulator Dagher Family

Before heading up the bank’s ethics and anti-fraud department, Dagher was head of Byblos Bank’s compliance unit for a decade.

The job of compliance bankers is to ensure that their employers comply with local and international rules on money laundering and terrorist financing. In Lebanon, “compliance is a risky business, if done correctly,” said a former regulator. The stakes are high: “You have Hezbollah [a paramilitary and political party designated a terrorist organisation by the US], you’ve got [politicians and their families]and it has a corrupt bank management “.

An already difficult job has been complicated by the country’s financial crisis, which erupted amid mass protests and a two-week bank shutdown in October 2019, Lebanon’s woes, worked up by the pandemic and a massive explosion in the port of Beirut last year, they have theirs. it has its roots in decades of state mismanagement and political corruption.

Approximately 40 banks serve the 7 million residents of Lebanon and many of them had invested heavily in public debt and in the central bank. About 70 percent of total bank assets are exposed to the Lebanese sovereign, according to the World Bank. The state defaulted on its debt last year and since then banks have been forced to sell foreign operations and lay off staff in radical restructurings.

Lebanon’s gross domestic product has shrunk by more than a fifth since the crisis began, and its economy has largely shifted to cash. “This is not normal banking,” said a senior banker. “We are dealing with crisis and insanity.” The reputation of the sector has been ruined. “A Lebanese banker was a precious commodity,” said the senior banker, citing the successes of financiers at major banks abroad. But two years after the crisis, now “your name is garbage.”

Disappointment in Lebanon’s banking sector is common. While there is no law on capital controls, individual banks have severely limited withdrawals and transfers. The customer-facing banker said they have to reject what they consider valid requests to access funds, such as medical bills, while providing some services, such as new accounts or withdrawals, only for VIP clients or bank managers.

With financiers vilified for their role in the crisis and private depositors of their money, enraged customers and protesters set fire to bank branches and abused staff. The customer-facing banker said customers have pointed guns at managers, demanding to withdraw their own cash.

His job is now “very dirty,” said the banker facing the client. But employees have no other option to keep their jobs and preserve their safety: “We are afraid, we are living in a country where there is no security, they can kill us.”

Their fear stems from Lebanon’s culture of impunity. Dagher’s murder isn’t the only one that remains unsolved. Dozens of political killings have gone unpunished in recent years. “The inability of the judiciary and the security forces to solve murders. . . has really led the public to lose faith in [their] ability. . . to protect them, ”said Aya Majzoub, a Lebanon researcher at Human Rights Watch.

Pressure has also come from outside Lebanon. More banks were sanctioned in the run-up to the crisis. In 2019, the US Treasury imposed sanctions on the Jammal Trust Bank for allegedly helping Hezbollah; it is now in liquidation. Lebanon’s central bank governor is the subject of two European investigations for money laundering and embezzlement. Hey denies any wrongdoing.

A severe shortage of dollars has made it easy for criminals to launder money through banks, desperate for cash. “It is very difficult to trace and verify the actual source” of cash, said a compliance specialist. Since the crisis began, “compliance is not the first priority, survival is the first priority,” said the specialist.

Byblos Bank said it had cooperated with the official investigation into Dagher’s death, but declined to answer other questions. Four bankers said Dagher was popular, known for his decency and diligence. “He was the most ethical person in the bank,” said a former colleague, adding: “If I could see what’s happening now [in the sector]I’m sure he would have quit. ”

Dagher “was everyone’s favorite,” said his daughter, Michèle. But her son Elie added: “We never realized how dangerous his job is.”