More than £36m in UK property seized in Riad Salameh money laundering probe

The UK has been the prime location for the Salameh family’s property empire in Europe, with European investigators uncovering £36.5 million of real estate assets acquired between 2012 and 2020, which they believe were purchased with misappropriated funds.

European judicial documents reveal, for the first time, how investigators managed to directly trace the source of the funds back to Forry Associates.

Forry, the governor’s brother’s company, is suspected of having syphoned off public funds through undisclosed commissions received from Lebanese banks for financial instrument purchases, without providing any corresponding services.

Documents seen by The National reveal that all these real estate assets were seized in March 2022 on the request of the French judiciary, under the trade and co-operation agreement, which regulates freezing and confiscation in criminal matters between the UK and the EU after Brexit.

“There are serious and converging indications of the commission of acts that could be classified as concealment and money laundering, committed as part of an organised group, involving embezzlement of public funds and aggravated breach of trust”, French judge Aude Buresi, who was entrusted with the investigation in 2021, stated in her seizing order related to the Salamehs’ properties in the UK.

“These real estate [assets] are alleged to be the proceeds of money laundering from embezzlement of public funds and aggravated breach of trust”, she added.

The Salameh family is not allowed “in any way [to] dispose of or deal with the properties”.

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The decision came about after the French judiciary asked its British counterpart in February 2022 for all information about Mr Salameh’s assets in the UK, using “any means, including raids” to obtain the relevant details as part of mutual legal assistance.

These actions were initiated from the French side as no official announcement has been made regarding legal proceedings by the British judiciary, despite a 2020 complaint filed by Guernica 37 Centre, a British anti-corruption body.

The complaint outlined the vast wealth held in the UK by the governor and his family, drawing notably from previous inquiries conducted by investigative media outlets OCCRP and Daraj.

Behind the scenes, however, discussions with law enforcement agencies have taken place, as British lawyer Toby Cadman, the head of Guernica 37, confirmed to The National.

In the UK system, the responsibility for investigating criminal offences lies with the police, while the Crown Prosecution Service charges suspects and conducts criminal proceedings.

“These matters have been investigated by the UK authorities for three years, however (…) specific details cannot be disclosed to prevent potential removal of assets by the parties implicated”, confirmed Mr Cadman.

‘A money laundering scheme allowing it to hide the origin of the funds’

But documents from the French investigation, seen exclusively by The National, reveal substantial findings regarding the UK acquisitions, with a particular focus on Fulwood Invest SA.

This Luxembourg-based company, owned by Mr Salameh and managed by his son, Nady, has made multimillion-pound acquisitions in the UK, capturing the attention of investigators.

The investigation was able to track Fulwood’s capital to BR 209, whose origin is traced to a Forry account at HSBC in Switzerland.

BR 209 subsequently injected more than £50 million between 2012 and 2020 into Fulwood to finance the UK property acquisitions of the Salameh family, the European investigators found.

The National visited four properties in London listed as being directly owned by either Nady Salameh or Fulwood Invest.

They included a discrete office tucked away in London’s legal hub, bought in 2012 for £5.9 million, and a converted warehouse by a canal in an area near King’s Cross station that has seen substantial redevelopment in recent years.

It was acquired by Fulwood Invest for £4.9 million in 2020.

Riad Salameh acquired a property near King’s Cross station for £4.9 million in 2020 using allegedly misappropriated funds. The National
Riad Salameh acquired a property near King’s Cross station for £4.9 million in 2020 using allegedly misappropriated funds. The National
Those who answered the door appeared to be unaware of what has happened to the properties.

Another building registered as belonging to Fulwood Invest in the Fulham area of west London, bought for £6.2 million in 2020, is leased to a supermarket and a drug rehabilitation centre.

At a high-end apartment block by Hyde Park in central London, a concierge said the property registered as belonging to Nady Salameh was currently unoccupied.

The block sits on a private road in an upmarket area that is home to many embassies and wealthy expatriates.

The property, valued at £3.5 million, was a gift to Riad Salameh in 2017 from an obscure Panamanian company.

But the Salameh family’s British real estate empire extends beyond London and includes a large office building in an industrial park in Bristol, housing Boeing Defence UK, which Fulwood Invest acquired for £10.5 million.

The three-storey office, encompassing 33,443 square feet of floor space on a 1.53-acre site with 136 parking spaces, was sold to an “unnamed overseas investor”, a UK magazine reported at the time.

The article added that the property is let to Thales Property, and underlet to Boeing Defence UK, on a 25-year lease at an annual rent of £911,086 from 2008.

In December 2016, Fulwood Invest also acquired several floors of office space in central Birmingham for £5.4 million.

The judiciary was able to trace these payments back to Forry through a series of transactions which seem to have no economic rationale, except for concealing the origins of the funds.

Upon analysing the financial flows, the French judge concluded that these funds originated from Forry’s Swiss account “via a succession of banking operations involving several offshore structures, Amanior and Westlake Commercial, of which Riad Salameh is the beneficial owner”, via his Luxembourg accounts, she wrote in the seizing order.

Property linked to Nady Salameh, the brother of Riad Samaleh, that were seized in London on behalf of the French authorities. The National
Property linked to Nady Salameh, the brother of Riad Samaleh, that were seized in London on behalf of the French authorities. The National
Belize-based Amanior International Ltd and Panama-based Westlake Commercial Inc are offshore entities with no commercial activities, which served as intermediaries in the alleged money laundering scheme, according to the European investigation.

This “demonstrates a money laundering scheme allowing [it] to hide the origin of the funds and the actual beneficiary of the acquired properties’ origin”, the French judge added.

Riad Salameh did not respond to The National’s request for comment. The National approached Nady Salameh, to answer a number of questions concerning the investigation. However, he did not provide a reply to these questions.

The UK network

Riad Salameh’s offshore companies have also been found to engage in transactions with UK-based firms.

According to the Swiss investigation, Westlake reportedly received $7 million between 2008 and 2012 from Forry.

In August 2008, Riad Salameh purchased via Westlake a 5 per cent share in Crossbridge Holding for $2.5 million.

Crossbridge holding, headquartered in Malta, serves as the parent company of Crossbring Capital, a UK-based wealth management firm, where Nady Salameh worked as one of the first recruits.

“The Salameh family was known historically to two of the founders of the company”, a representative of Crossbridge acknowledged to The National.

Established in 2008 by bankers of Lebanese origin, the company has ties with several prominent Lebanese businessmen and officials.

According to Lebanese legislation, the central bank governor is prohibited from engaging in external business activities, except for holding securities or shares in joint-stock companies.

“Crossbridge conducted all the due diligence required by the Malta authorities for any shareholder holding a minority stake in a company, ie, identity of beneficial ownership and bank reference”, a representative of Crossbridge told The National when questioned about Riad Salameh’s investment in the company.

Regarding the source of the funding, they added that the “bank account is monitored by the bank itself and such responsibility does not extend to the companies in which the bank account owner elects to invest those funds”.

In January 2009, Westlake transferred its shares to Crossland Assets Corp, another Panama-based company, as revealed by an investigation conducted by OCCRP and Daraj.

At the time, the ownership of both entities remained undisclosed, even though there were indications linking Crossland to Riad Salameh.

Crossland Assets moved to Liechtenstein in 2018 and became Crossland Limited, which, according to our information, has multiple bank accounts in Lebanon belonging to Riad Salameh.

In 2015, Crossbridge decided to raise its capital, leading to Bank Audi Group’s acquisition of a 19 per cent stake in the company.

Riad Salameh, as the governor of Lebanon’s central bank, is the regulator of Bank Audi, one of the biggest banks in the country.

This raises concerns about potential conflicts of interest since Bank Audi invested in Crossbridge while a company tied to Riad Salameh still held shares in the same company.

When questioned about this matter, a media representative for Bank Audi told The National that “the ultimate owner of Crossland stake in Crossbridge was reported to [them] as being Mr Nady Salemeh”.

The representative of Crossbridge said that they performed all required regulatory filings regarding the acquisition of shares in Crossbridge to all of their regulators.

Crossland retained ownership of the share until December 2016 when it sold it to Beryte International NV, a subsidiary of Lebanon’s Bank Audi.

Bank Audi denied all issues, saying that the “shares were acquired in a legal and transparent transaction, at arm’s length, and at financial conditions exactly similar to the previous subscription in Crossbridge shares”.

A representative of Crossbridge told The National: “All required regulatory filings regarding the purchase of shares by Beryte were performed. All required disclosures were made in accordance with regulatory duties. Crossbridge has no interest resulting from a sale and purchase of its shares.”

A very generous gift

In January 2017, a month after the transaction, a mysterious Panamanian company, Merrion Capital SA, transferred the ownership of the Hyde Park property valued at £3.5 million to Riad Salameh without “money or anything that has a monetary value”, according to official documents from the English authorities seen by The National.

This means that he was given the property as a gift, which he passed on to his son the very next day.

The OCCRP and Daraj investigation revealed that Merrion capital was created the same day in November 2008 and placed under the same management as Crossland, highlighting coincidences connecting Crossland to the flat donation.

Bank Audi said they “have no connection with Merrion and never heard of it before”.

Crossbridge said that transaction involving the flat is “entirely unknown, unrelated and unconnected to Crossbridge”.

The identity of the person behind this very generous gift remains unknown, but the suspicion surrounding the property led judge Aude Buresi to declare that the value of the Hyde Park apartment “partly corresponds to the value of the proceeds from money laundering, committed as part of an organised group, involving embezzlement of public funds and aggravated breach of trust”.

Article Credit: https://www.thenationalnews.com/mena/lebanon/2023/07/27/riad-salemeh-uk-property-seized/