Sobhi Mahmoud Fayad

Sobhi Mahmoud Fayad is a U.S.-designated senior Hezbollah official and financier in the Tri-Border Area (TBA) of South America––the region that straddles the borders of Paraguay, Brazil, and Argentina. Fayad helped coordinate the financial network of U.S.-designated Assad Ahmad Barakat in the TBA in the 1990s. He has served as a liaison between the Iranian embassy and the Hezbollah community in the TBA, and has traveled to Lebanon and Iran to meet with the group’s leadership and receive military training.“Terrorist and Organized Crime Groups in the Tri-Border Area (TBA) of South America,” Library of Congress, July 2003, 2, 20, https://www.loc.gov/rr/frd/pdf-files/TerrOrgCrime_TBA.pdf. Fayad was imprisoned in Paraguay in 2002 for tax evasion, though he was released in 2009 and reportedly continues to reside in the TBA and travel freely on a Paraguayan passport.“Recent OFAC Actions,” U.S. Department of the Treasury, December 6, 2006, https://www.treasury.gov/resource-center/sanctions/OFAC-Enforcement/pages/20061206.aspx; “The many criminal heads of the Golden Hydra,” Counter Extremism Project, accessed May 25, 2016, https://www.counterextremism.com/sites/default/files/The%20Many%20Criminal%20Heads%20of%20the%20Golden%20Hydra%20%28May%202018%29.pdf; Dr. Emanuele Ottolenghi, “Examining the Effectiveness of the Kingpin Designation Act in the Western Hemisphere,” Congressional Testimony: Foundation for Defense of Democracies, November 8, 2017, http://docs.house.gov/meetings/FA/FA07/20171108/106606/HHRG-115-FA07-Wstate-OttolenghiE-20171108.pdf.

Fayad has resided in the TBA, where he is reportedly an influential member of the Lebanese community living there, since at least 1992.“Terrorist and Organized Crime Groups in the Tri-Border Area (TBA) of South America,” Library of Congress, July 2003, 2, 20, https://www.loc.gov/rr/frd/pdf-files/TerrOrgCrime_TBA.pdf. He served as the executive assistant of U.S.-designated Assad Ahmad Barakat, the leader of Hezbollah’s financial network in the region.“Treasury Targets Hizballah Fundraising Network in the Triple Frontier of Argentina, Brazil, and Paraguay,” U.S. Department of the Treasury, December 6, 2006, https://www.treasury.gov/press-center/press-releases/Pages/hp190.aspx; “Terrorist and Organized Crime Groups in the Tri-Border Area (TBA) of South America,” Library of Congress, July 2003, 2, 20, https://www.loc.gov/rr/frd/pdf-files/TerrOrgCrime_TBA.pdf. Fayad himself conveyed significant funds to Hezbollah-linked charities.“Terrorist and Organized Crime Groups in the Tri-Border Area (TBA) of South America,” Library of Congress, July 2003, 2, 20, https://www.loc.gov/rr/frd/pdf-files/TerrOrgCrime_TBA.pdf. In 2000, he sent more than $3.5 million to Hezbollah’s “Martyr” Social Beneficent Organization, which provides care to children whose parents were killed in the service of Hezbollah, and reportedly received a thank you letter from Hezbollah’s Secretary General Hassan Nasrallah in response.“Terrorist and Organized Crime Groups in the Tri-Border Area (TBA) of South America,” Library of Congress, July 2003, 2, 20, https://www.loc.gov/rr/frd/pdf-files/TerrOrgCrime_TBA.pdf; “The many criminal heads of the Golden Hydra,” Counter Extremism Project, accessed May 25, 2016, https://www.counterextremism.com/sites/default/files/The%20Many%20Criminal%20Heads%20of%20the%20Golden%20Hydra%20%28May%202018%29.pdf.

Fayad was first arrested in October 1998 for conducting surveillance of the U.S. embassy in Asunción, Paraguay, though he was released after cooperating with authorities. He was arrested again in October 1999 for the same reason, though he was again released after authorities failed to gather sufficient evidence to charge him. Fayad was arrested for a third time on November 8, 2001, at the Galería Page shopping center (today known as Shopping Uniamérica) in Ciudad del Este, Paraguay, after authorities found evidence that he was transferring large sums of money to banks in Lebanon and Canada almost daily. He was indicted for tax evasion, falsified document use, and running a business without accounting books, and underwent trial in November 2002.“Terrorist and Organized Crime Groups in the Tri-Border Area (TBA) of South America,” Library of Congress, July 2003, 2, 20, https://www.loc.gov/rr/frd/pdf-files/TerrOrgCrime_TBA.pdf. Fayad was convicted and sentenced to six and a half years in prison.“Libanés condenado por evasión ya está recluido en la Agrupación,” November 23, 2002, http://www.abc.com.py/edicion-impresa/policiales/libanes-condenado-por-evasion-ya-esta-recluido-en-la-agrupacion-673509.html. After he was released from Paraguayan custody in 2009, Paraguay has since reportedly lost track of his whereabouts.“The many criminal heads of the Golden Hydra,” Counter Extremism Project, accessed May 25, 2018, https://www.counterextremism.com/sites/default/files/The%20Many%20Criminal%20Heads%20of%20the%20Golden%20Hydra%20%28May%202018%29.pdf.

Fayad was designated as a Specially Designated Global Terrorist by the U.S. Department of the Treasury on December 6, 2006.“Treasury Targets Hizballah Fundraising Network in the Triple Frontier of Argentina, Brazil, and Paraguay,” U.S. Department of the Treasury, December 6, 2006, https://www.treasury.gov/press-center/press-releases/Pages/hp190.aspx. According to the designation, he held both Lebanese and Paraguayan citizenship, as well as multiple Paraguayan passports, at the time.“Recent OFAC Actions,” U.S. Department of the Treasury, December 6, 2006, https://www.treasury.gov/resource-center/sanctions/OFAC-Enforcement/pages/20061206.aspx.

Fayad’s Facebook account suggests that he has traveled extensively in recent years on a valid Paraguayan passport, according to a 2017 congressional testimony from Dr. Emanuele Ottolenghi of the Foundation for the Defense of Democracies. In December 2015, Fayad reportedly traveled to Karbala, Iraq, to complete a pilgrimage. In September 2016, he reportedly flew from Brazil to Lebanon and then Saudi Arabia to fulfill the Islamic Hajj pilgrimage. In 2017, Fayad reportedly returned to Lebanon and Saudi Arabia, and also visited Damascus, Syria.Dr. Emanuele Ottolenghi, “Examining the Effectiveness of the Kingpin Designation Act in the Western Hemisphere,” Congressional Testimony: Foundation for Defense of Democracies, November 8, 2017, http://docs.house.gov/meetings/FA/FA07/20171108/106606/HHRG-115-FA07-Wstate-OttolenghiE-20171108.pdf.

 
United States

The U.S. Department of the Treasury designated “Sobhi Mahmoud Fayad” as a Specially Designated Global Terrorist pursuant to Executive Order (E.O.) 13224 on December 6, 2016.“Treasury Targets Hizballah Fundraising Network in the Triple Frontier of Argentina, Brazil, and Paraguay,” U.S. Department of the Treasury, December 6, 2006, https://www.treasury.gov/press-center/press-releases/Pages/hp190.aspx.

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