Anti-money laundering rules and the future of banking secrecy laws: evidence from Lebanon

Abstract

This research aims to examine the banking secrecy laws and analyze their effects on the anti-money laundering rules in Lebanon. Banking secrecy laws have always been an advantage for customers, while anti-money laundering procedures have been considered as safety measures to guarantee community security. Certainly, reaching an appropriate balance is a dilemma which many legislative authorities face. Through this research, primary and secondary data are gathered as both are needed to create an overview of the extant situation. Indeed, the existing Lebanese laws related to banking secrecy and anti-money laundering rules are identified. In addition, a qualitative study is conducted through interviewing four Lebanese banks directors that were selected based on the purposive sampling technique. Analysis through using NVivo software is then performed. Results show that banking secrecy rules in Lebanon should be redefined in order to allow revealing customers information in case of any suspicion through following an easy and simple procedure that does not harm the customers confidentiality. Eventually, the increasing menace of terrorism and worldwide money laundering justify the need to amend these laws since without an unlimited cooperation of banks, the successful avoidance of threat is relatively difficult to be achieved. Finally, guidelines that interest scholars, banks, practitioners and legal authorities in Lebanon and elsewhere are provided.