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Lebanon’s campaign against Hezbollah’s finances may be designed to look tougher than it is. Under pressure from Washington and international regulators, Beirut has done enough to claim progress by tightening the regulated financial sector against Hezbollah-linked entities, but without seriously threatening Hezbollah’s parallel financial apparatus, which operates largely outside it. This raises the troubling possibility that Lebanon is not merely failing to impose meaningful pressure but deliberately choosing measures that stop short of actually harming, and therefore provoking, Hezbollah. Lebanese leaders have repeatedly warned that directly confronting the group risks renewed internal conflict. A serious assault on Hezbollah’s finances would strike at the resources sustaining its organization and could invite precisely that confrontation. If so, Beirut has found a politically useful middle ground: cosmetically satisfying foreign demands to preserve the domestic status quo.
Iran remains Hezbollah’s main external source of money. Secretary-General Naim Qassem has acknowledged Iranian funding for postwar relief and reconstruction. In November 2025, the U.S. Treasury said Iran’s Islamic Revolution Guard Corps-Quds Force, its foreign-operations arm, had transferred more than $1 billion to Hezbollah since the beginning of that year, mostly through money exchange companies. Iran and Hezbollah have also used gold to move funds. Qassem has acknowledged smaller contributions from the Iraqi state, Shiite religious authorities and shrines, Iran-aligned Shiite militias, and Iraqi citizens. The Houthis raised funds directly for Hezbollah in 2019 and later for its Lebanese support base. Hezbollah has used cryptocurrency too, though the scale remains unclear.
Hezbollah also generates revenue through ostensibly legitimate businesses and commercial networks that conceal the group’s involvement behind nominal owners. Treasury says a commercial network run by financier Alaa Hamieh diverted more than $100 million to Hezbollah since 2020, while Hamieh allegedly used his state investment post to steer millions toward Hezbollah-linked projects.
Hezbollah-controlled and affiliated entities then manage and move the money. Its Central Finance Unit controls income and spending, Bayt al-Mal serves as its treasury, and Al-Qard al-Hassan (AQAH) provides bank-like services and holds cash and gold. AQAH officials have used personal “shadow” accounts to disguise transactions and move more than $500 million through Lebanese banks. AQAH-backed Jood SARL converts gold into cash, while Hezbollah-linked money-service businesses like CTEX have supplied dollars to Hezbollah institutions and recruited sympathetic money changers. WaTaawanou, a crowdfunding charity officially outside Hezbollah’s formal hierarchy, raises donations for needy Lebanese but directs much of the resulting spending to Hezbollah-run or -linked hospitals and businesses. These funds support personnel, weapons procurement, social programs, compensation, housing, and post-war reconstruction.
Lebanese measures have so far done little to disrupt this diversified financial ecosystem. AQAH’s liquidity problems do not demonstrate otherwise because they predated Beirut’s principal financial restrictions. It began delaying compensation checks in January 2025 and froze them on June 23, after nearly $500 million had already been disbursed. The Lebanese Central Bank did not issue Circular 170 until July 14. That measure bars regulated financial institutions from dealing with AQAH and related sanctioned, unlicensed entities, but does not close AQAH or seize its assets.
AQAH therefore remains operational. It retained branches that survived Israeli strikes, while Treasury said in February 2026 that Hezbollah continued using the institution and that AQAH officials had created Jood to ease its liquidity pressure. The Interior Ministry later withheld AQAH’s annual 2026 certificate of good legal standing pending investigations, but left its underlying association registration intact. An-Nahar reported would require a Cabinet decision to revoke. But, on June 18, Justice Minister Adel Nassar said the government had not even placed the AQAH file on the Cabinet agenda. Stripping a core Hezbollah institution of its legal status would mark a far more direct confrontation with the group, one the government appears unlikely to invite amid the current standoff over Hezbollah’s disarmament.
Judicial action has likewise stopped short of disrupting AQAH’s operations. Nassar referred AQAH and Jood to the public prosecutor in June for investigation. Yet by July 21, An-Nahar reported that the case remained dormant. Prosecutors were waiting for the Central Bank to provide documents establishing financial violations but had not themselves requested them.
Lebanon’s Central Bank also issued Intermediate Circular 761 on May 4, 2026, effective June 30, requiring regulated nonbank financial institutions—including exchange houses, finance companies, specialized lenders, and electronic-payment providers—to identify customers and report cash transactions of $1,000 or more, while flagging repeated transactions apparently structured to evade the threshold. But those requirements can still be bypassed through unlicensed or informal hawala networks, where a sender pays a broker abroad and a partner in Lebanon pays the recipient locally, without the original money passing through a bank or regulated Lebanese institution.
Lebanon’s restrictions have therefore changed Hezbollah’s methods more than its access to money. After Beirut tightened airport controls, Iran reportedly shifted to more couriers carrying smaller amounts of cash or jewelry while moving hundreds of millions of dollars through Dubai. When Whish Money, a Lebanese transfer company, closed WaTaawanou’s donation account in October 2025, the charity directed donors to AQAH and other transfer firms. Hezbollah also reportedly planned a new AQAH branch in Tyre without signage. Treasury has meanwhile documented Hezbollah financiers transferring companies to relatives or associates and creating new entities amid sanctions pressure.
Many of the steps required for real financial pressure already overlap with obligations Lebanon accepted under its FATF action plan, including more terrorist-financing investigations and prosecutions, better identification of true owners, seizure of illicit cross-border currency and precious metals, and stronger targeted financial sanctions. Applied to Hezbollah, that means closing AQAH, prosecuting officials who move its money through personal accounts, shutting Jood and replacement companies, seizing Hezbollah-bound cash and gold, revoking the licenses of financial firms that facilitate the group, and cutting Hezbollah-linked businesses off from state contracts, licenses, and institutions. Claims that Lebanon has clamped down on Hezbollah’s finances, or gone as far as it reasonably can, should be judged against such outcomes—not regulations, administrative measures, or assurances of progress that do not produce measurable, real-world impact.
David Daoud is senior fellow at the Foundation for Defense of Democracies (FDD) focused on Israel, Hezbollah, and Lebanon affairs. Ahmad Sharawi is a senior research analyst at FDD focused on Syria and Iranian intervention in Arab affairs and the Levant. Follow David on X @Davidadaoud. Follow Ahmad on X @AhmadA_Sharawi.
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