Lebanese Hezbollah is using money laundering and the drug trade — and dabbling heavily in used cars — to raise revenue for their own nefarious operations and benefit their Iran regime benefactors, a leading Drug Enforcement Administration official said today.
John Fernandez, the DEA’s assistant special agent in charge of the Special Operations Division’s Counter-Narcoterrorism Operations Center, told a forum at The Washington Institute for Near East Policy in D.C. that when it comes to connections on the criminal side of terrorist organizations, the ideologies of criminal partners cease to matter — whether Hezbollah teams up with Colombian cartels or Shia drugs are funneled to Saudi nightclubs.
“When it comes to the bottom line, it doesn’t matter about sectarian differences,” he said.
And though Iran infamously supports Hezbollah, the lucrative proceeds from the group’s underworld dealings allow a reciprocal relationship. “We have seen indications of Hezbollah criminal activity also benefiting their Iranian masters,” Fernandez said.
Of 68 groups designated as foreign terrorist organizations by the United States, the DEA has linked 25 of those to drug trafficking or some role in the drug trade. Because of this convergence, Fernandez noted, the DEA is regularly crossing into counterterrorism cases. Sometimes the agency hands over information to relevant CT partners for pursuit — including intel on attacks, kidnappings, or the targeting of Americans overseas, constituting “literally hundreds of reports” — if there is no convergence into criminal activity investigated by the DEA. And sometimes pursuing charges for drug or financial crimes turns out to be the best way remove terrorists from the battlefield.
“DEA has a critical role in the USG’s overall fight against terrorism,” Fernandez said, stressing the agency’s footprint with a vast global network. In Afghanistan, for example, the agency has helped save U.S. military lives by gleaning information about locations of improvised explosive devices or planned ambushes.
Focusing on the criminal network operations of Hezbollah, the Taliban, ISIS, and Colombia’s FARC and ELN, Lebanese Hezbollah stands out as unique for its sophisticated intelligence operations and very hierarchal leadership as well as recognition as a state actor with political and military wings. Fernandez said one shouldn’t believe the denials of Hezbollah leader Hassan Nasrallah, who claims reports of the group’s criminal activities are “completely baseless” and drug trafficking would violate Islamic law.
“They operate as a traditional organized crime group just like the Mafia or Pablo Escobar’s cartel,” Fernandez said. “Nasrallah’s saying that, but he’s a murdering terrorist” — just like Escobar built orphanages and murdered people. “It’s a PR campaign and sometimes they lie.”
“If Nasrallah really wanted to rein these people in he could, but he doesn’t,” he noted.
Hezbollah, a major proxy for Iran, receives the majority of its support from Iran — money also mingled with criminal proceeds — but as the cash flow from Iran has been strained Hezbollah has increasingly turned to criminal enterprises for revenue, Fernandez said. They operate in the Shia Crescent, buoyed by alliances with Bashar al-Assad’s regime in Syria, Russia, and the Houthis in Yemen — and they tap into a global diaspora of money launderers, arms traffickers, and drug traffickers on six continents.
The type of criminal activity conducted by Hezbollah’s networks varies from continent to continent, but in North America the main operations are money laundering, the used car trade, and drug trafficking — “trafficking coke here whether as transshipment broker or supplier.” When the Treasury Department blocked American financial institutions from conducting business with Lebanese Canadian Bank in 2011, for example, officials alleged that revenue from European and Latin American drug sales was wired by the bank to used car dealers in the United States, who shipped the cars to West Africa where they were sold; the proceeds came back to Hezbollah.
In South America, Hezbollah has benefited from a “long history of Islamic extremism in the Tri-Border Area” and its ties to Colombian cartels and a corrupt Venezuela government — the regimes of Hugo Chavez and Nicolas Maduro, Fernandez noted, have facilitated air shipments of cocaine to Syria and helped members of Hezbollah and Iran’s Islamic Revolutionary Guard Corps get fraudulent passports. In Mexico, he cited money laundering links between Hezbollah and Los Zetas cartel.
DEA investigations and intel have pointed “to a sort of overlapping” of Iran and Hezbollah benefiting from this criminal activity, and an “uptick in IRGC criminal activity as they face strains with the proxy wars and the sanctions.” Fernandez said the agency has “seen cases where Hezbollah criminal activity does benefit Iran,” and overall “a lot of the criminal activity touches the U.S.”
Fernandez also noted an “extensive permeation of drug trafficking of all sorts throughout Syria, being trafficked by not just Hezbollah but Syrian military intelligence,” criminal activity to the extent that it’s “just rotting their whole system.”