US Treasury Busts International Money Laundering Nexus in The Diamond & Art Market

The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) has disrupted an international money laundering and sanctions evasion network supporting Hizballah financier Nazem Said Ahmad, targeting over fifty individuals and companies across nine countries. The network facilitated the payment, shipment, and delivery of cash, diamonds, precious gems, art, and luxury goods for Ahmad's benefit, allowing him to evade US sanctions and finance Hizballah and his luxurious lifestyle.

Brian E. Nelson, the Under Secretary of the Treasury for Terrorism and Financial Intelligence, warned that luxury goods market participants should be attentive to potential tactics and schemes used by terrorist financiers, money launderers, and sanctions evaders to launder illicit proceeds through the purchase and consignment of luxury goods.

Ahmad directs a global network of family members, associates, and companies that take advantage of the permissive nature of the global diamond, precious gems, and art market to facilitate payment for, and shipment and delivery of, luxury goods. The network utilises legal and illegal arrangements to coerce both witting and unwitting participants into falsely engineering certificates, required under the Kimberley Process, to manipulate diamond prices and taxes and give their business the appearance of legitimacy.

The Treasury Department said the network also uses aliases, front companies, and fraudulent paperwork to enable Ahmad to purchase or consign high-priced luxury goods and artwork from auction houses and galleries worldwide. The network undervalues invoices for imported goods and clears bulk items through seaports, leveraging Hizballah's influence at these ports of entry to move assets into Lebanon without paying the applicable taxes and duties.

The network includes Ahmad’s family members, such as his son Firas Ahmad, who handles many of his father's business affairs in South Africa. Firas Ahmad is the director of South Africa-based diamond company Mega Gems (PTY) LTD (Mega Gems) and controls another diamond company, Thula Uzwe Trading, also in South Africa. Firas Ahmad obfuscated his ultimate beneficial ownership of Mega Gems through a front company, Oriental Dynasty Limited, directed by his wife, Rim Nasser, who acted as a nominee shareholder.

This OFAC designation is a part of a coordinated action with the Department of Homeland Security, the Department of State's Rewards for Justice program, and the United Kingdom, to disrupt the international money laundering and sanctions evasion network of Hizballah financier and Specially Designated Global Terrorist Nazem Said Ahmad.