Former finance minister Ali Hassan Khalil was one of two ex-officials sanctioned by the US © AFP via Getty Images

The US has widened its anti-Hizbollah campaign by imposing sanctions against two former Lebanese ministers for allegedly helping the powerful Iran-backed political party and paramilitary, which Washington considers a terrorist organisation.

The US Treasury on Tuesday accused a former finance minister and former transportation and public works minister, both of whom left office early this year, of corruptly aiding Hizbollah. Neither are Hizbollah members, although both are in parties that ally with Hizbollah in Lebanon’s parliament.

Mike Pompeo, US secretary of state, alleged that Ali Hassan Khalil and Yusuf Fenianos “directed political and economic favours to Hizbollah, including ensuring Hizbollah-owned companies won government contracts worth millions of dollars and moving money from government ministries to Hizbollah-associated institutions”. 

“Hizbollah depends on Lebanon’s corrupt political system for survival,” Mr Pompeo said.

Hundreds of thousands of Lebanese protested endemic official graft last autumn, denouncing the entire post-civil war political class, which includes Hizbollah, as inept and kleptocratic. The recent explosion at Beirut’s port, which killed 192 people, was widely seen as being rooted in state negligence and dysfunction. 

Lebanon’s judiciary is considered to be hampered by political appointments, and there are few examples of public officials being held accountable for wrongdoing committed while in office.

The US sanctions, which fall under terrorism legislation, “show that we’ll hold people accountable for their actions whether they’re in [or out of] government”, said another senior US government official. The measures announced on Tuesday are focused on figures allied to Hizbollah only, however.

Ali Hassan Khalil, from the Shi’i majority Amal Movement, was finance minister from 2014 until 2020, presiding during a period of precipitous economic decline. He is also a former public health minister.

A second US official said Mr Khalil as finance minister had “attempted to shake down contractors” to pay kickbacks and demanded that a percentage should be paid to him directly. 

“He abused public trust as finance minister in the most spectacular way a finance minister can,” the official alleged. 

Both former ministers “remain very active in Lebanese politics”, the official added.

From 2016 to 2020, Yusuf Fenianos headed the transportation and public works ministry, which has been implicated in the scandal surrounding the thousands of tonnes of explosives improperly kept at Beirut port for six years, which ultimately blew up. He belongs to the Christian-majority Marada Movement.

Yusef Fenianos, the former transport minister © AFP via Getty Images

The Treasury’s accusations against the Mr Fenianos include contracting “Hizbollah-owned” companies for publicly funded projects, leaking “sensitive documents” relating to the international tribunal for the murder of ex-prime minister Rafiq Hariri, and “diverting funds from the ministry to offer perks to bolster his political allies”.

Neither Lebanese officials were immediately available for comment. The US did not provide substantive evidence to back up its allegations.

Angry demonstrations have felled two successive governments in under a year, and Lebanon is currently led by a caretaker administration.

Even before the catastrophic explosion which caused up to $4.6bn worth of damage, according to World Bank estimates, Lebanon was crippled by a devastating economic crisis that has pushed more than half the population below the poverty line. 

France has led a push by world leaders to pressure Lebanon’s politicians to undertake reforms to unlock international financing. But potential donors have worried that aid for reconstruction could be diverted by corruption.

During a visit to Beirut last week, Emmanuel Macron, French president, hinted Europe could consider sanctions against political figures. Yet he also met with a Hizbollah lawmaker, insisting that the party had been elected and their co-operation was needed to form a new government.

David Schenker, the top US state department official for the Middle East, said Washington would maintain pressure on Hizbollah in “coming weeks and months”, adding Lebanon’s political leaders had failed to address their people’s needs or fight corruption.

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