For years, U.S. authorities said, Mohammad Ibrahim Bazzi funneled millions of dollars to Hezbollah, the militia backed by Iran and based in Lebanon that is currently clashing with Israel.
Because of Mr. Bazzi’s ties to the group, the Treasury Department deemed him a terrorist. The designation prohibited people in the United States from doing business with him or for his benefit.
On Friday, in a Brooklyn federal court, Mr. Bazzi, 60, acknowledged trying to evade those sanctions by using a fake franchise agreement to obtain money from restaurants in Michigan in which he had a secret ownership stake. He pleaded guilty to one count of conspiracy to conduct unlawful transactions involving a specially designated global terrorist.
Mr. Bazzi, a dual citizen of Lebanon and Belgium, said in court that he had worked with others to try to transfer the money, even though “I know that such transfer was prohibited.”
The charge to which he pleaded guilty carries a potential fine of up to $1 million and a maximum prison sentence of 20 years, although prosecutors and defense lawyers said on Friday that under federal guidelines he would most likely face a sentencing range of 37 to 46 months in prison.
The scheme began in 2006 when a co-defendant, Talal Khalil Chahine, fled the United States, losing control of a restaurant chain he had owned in Michigan. Federal prosecutors there said Mr. Chahine had skimmed $20 million in restaurant proceeds and sent it to Lebanon. Michigan tax authorities put liens on his investments, federal prosecutors in New York said.
The next year, according to a federal indictment, Mr. Chahine, Mr. Bazzi and others spent about $7 million to secretly buy the restaurant chain and resume operations.
In 2018, Treasury officials named Mr. Bazzi as a “specially designated global terrorist” and a key Hezbollah financier who operated in Belgium, Lebanon, Iraq and West Africa. Hezbollah “uses financiers like Bazzi who are tied to drug dealers, and who launder money to fund terrorism,” Steven T. Mnuchin, the Treasury secretary at the time, said then.
Hezbollah, which the United States labeled a foreign terrorist organization in 1997, has long been among the more violent forces in Lebanon and across the Middle East.
In 1983, according to the State Department, the group killed 241 U.S. military personnel, including 220 Marines, 18 sailors and three soldiers in a terrorist bombing of the Marine Corps barracks in Beirut.
The group has been involved in a long-running conflict with Israel that has flared into bloodshed, and the standoff along Israel’s north border is particularly critical as it fights a war in Gaza.
This week, tensions increased when dozens of people in Lebanon were killed and thousands were wounded by the coordinated explosions of pagers and walkie-talkies that targeted members of Hezbollah and are believed to have been booby-trapped by Israel. On Friday, Israeli military officials said they had killed several top Hezbollah commanders, including one wanted by the United States for his role in the barracks bombing, in an airstrike on Beirut.
In discussing Mr. Bazzi’s guilty plea, Breon Peace, the U.S. attorney in Brooklyn, described it as a success in a continuing battle against terrorists.
“This outcome demonstrates our commitment to enforcing sanctions imposed to starve terrorism financiers of funds, and the stark consequences that will be enforced when they are ignored,” Mr. Peace said in a statement.
After Mr. Bazzi was designated as a global terrorist, an indictment said, he moved to sell the restaurant chain and its headquarters and to transfer the proceeds out of the United States. The headquarters, in Dearborn, Mich., was sold in 2018 for $905,000; a few months later, in a phone call from New York State that was recorded by federal authorities, Mr. Chahine and Mr. Bazzi discussed several schemes to transfer sale proceeds out of the U.S.
The schemes, prosecutors said, included transferring the money through someone in China as part of a bogus purchase of restaurant equipment; transferring it through someone in Lebanon in a phony real estate deal in Beirut; and pretending the money was being sent as a loan to Mr. Chahine’s relatives in Kuwait.
Finally, prosecutors said, the two men decided to transfer as part of a fictitious agreement for the rights to operate a Lebanese restaurant chain in the U.S. They then created a paper trail with fake documents, including purported franchise agreements mailed from Lebanon to New York and from New York to Michigan.
Romanian law enforcement authorities arrested Mr. Bazzi last year in Bucharest. He was then extradited to the United States.
Treasury officials have said that Mr. Bazzi maintained ties to a Lebanese drug kingpin, Ayman Joumaa, and described Mr. Bazzi as “a close associate” of Yahya Jammeh, a former leader of Gambia who is accused of plundering his country’s coffers and ordering assassinations.
Mr. Bazzi also worked with Hezbollah’s representative to Iran to re-establish a political relationship between Gambia and Iran and to expand banking access between Iran and Lebanon, according to Treasury officials.
The post Man the U.S. Says Financed Hezbollah Admits Trying to Evade Sanctions appeared first on New York Times.