Oil trader widens legal threat against Lebanese bank over funds row

BankMed has denied claims that it failed to return $1 billion in deposits to oil trader IMMS. (AFP)
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Updated 14 December 2019

Oil trader widens legal threat against Lebanese bank over funds row

  • Protests that have swept Lebanon since Oct. 17 have heaped pressure on the banking sector

DUBAI: Oil trading company IMMS is considering launching more legal action against Lebanon’s BankMed, which it accuses of refusing to release funds on request.

In a statement to Arab News, IMMS said that it has instructed its lawyers to initiate legal proceedings in other jurisdictions where BankMed has a presence.

It follows the launch of proceedings in New York by IMMS against BankMed, which it claims failed to return $1 billion of its deposits when requested.

“By this action, plaintiff IMMS Limited (IMMS) seeks remedies against defendant BankMed SAL (BankMed) for BankMed’s brazen theft of more than $1 billion from its banking client IMMS,” the court filing said.

However, BankMed denies the allegations and said that it had discovered “material breaches of contract and attempts by IMMS to direct funds due to BankMed overseas” between Oct. 30 and Nov. 12, 2019, without providing further details.

An IMMS spokesperson told Arab News: “Since learning of the proceedings, BankMed has chosen to respond through the media in breach of its obligations of confidentiality to its customer. In doing so it has chosen to make the a series of unfounded allegations that it has not previously seen fit to raise with IMMS or its lawyers. Its response sits uncomfortably with its purported commitment to high standards of banking, the protection of its customers’ interests and its application of Lebanese laws and practices.”

Four major US banks, JP Morgan Chase, CitiBank, BNY Mellon and Standard Chartered Bank, have also been named in the suit.

According to court fillings, the four banks were correspondent banks for BankMed in New York. Bankmed used these banks to effect large transactions in US dollars, which include large deposits by IMMS that it claims BankMed has retained, as well as payments to IMMS customers which it alleges BankMed delayed and withheld.

Lebanon’s economy is in its worst state since the 1975-1990 civil war, with the political rise of Iran-backed militia Hezbollah and the neighboring Syrian civil war deterring foreign investment and putting pressure on the country’s liquidity-starved banking sector.

Protests that have swept Lebanon since Oct. 17 have added to the pressures, deepening the hard currency crunch and prompting commercial banks to put curbs on foreign currency withdrawals and transfers abroad.

Saudi Arabia’s 6-point plan to jumpstart global economy

Updated 07 July 2020

Saudi Arabia’s 6-point plan to jumpstart global economy

  • Policy recommendations to G20 aim to counter effects of pandemic

DUBAI: Saudi Arabia, in its capacity as president of the G20 group of nations, has unveiled a six-point business plan to jump start the global economy out of the recession brought on by the COVID-19 pandemic.

Yousef Al-Benyan, the chairman of the B20 business group within the G20, told a webinar from Riyadh that the response to the pandemic -— including the injection of $5 trillion into the global economy — had been “reassuring.”

But he warned that the leading economies of the world had to continue to work together to mitigate the effects of global lockdowns and to address the possibility of a “second wave” of the disease.

“Cooperation and collaboration between governments, global governance institutions and businesses is vital for an effective and timely resolution of this multi-dimensional contagion transcending borders,” Al-Benyan said.

“The B20 is strongly of the view there is no alternative to global cooperation, collaboration and consensus to tide over a multi-dimensional and systemic crisis,” he added.

The six-point plan, contained in a special report to the G20 leadership with input from 750 global business leaders, sets out a series of policy recommendations to counter the effects of the disease which threaten to spark the deepest economic recession in nearly a century.

The document advocates policies to build health resilience, safeguard human capital, and prevent financial instability.

It also promotes measures to free up global supply chains, revive productive economic sectors, and digitize the world economy “responsibly and inclusively.”

In a media question-and-answer session to launch the report, Al-Benyan said that among the top priorities for business leaders were the search for a vaccine against the virus that has killed more than half-a-million people around the world, and the need to reopen global trade routes slammed shut by economic lockdowns.

He said that the G20 response had been speedy and proactive, especially in comparison with the global financial crisis of 2009, but he said that more needed to be done, especially to face the possibility that the disease might surge again. “Now is not the time to celebrate,” he warned.

“Multilateral institutions and mechanisms must be positively leveraged by governments to serve their societies and must be enhanced wherever necessary during and after the pandemic,” he said, highlighting the role of the World Health Organization, the UN and the International Monetary Fund, which have come under attack from some world leaders during the pandemic.

Al-Benyan said that policy responses to the pandemic had been “designed according to each country’s requirements.”

Separately, the governor of the Saudi Arabian Monetary Authority said that it was “too early” to say if the Kingdom’s economy would experience a sharp “V-shape” recovery from pandemic recession.