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The arrest of former Central Bank of Lebanon chief Riad Salameh last week has triggered a slew of speculation both within and beyond Lebanon's borders.

Until he was forced to step down at the end of July last year, 73-year-old Salameh was governor of Banque du LibanĚýfor 30 years (1993-2023).

He was detained on 5 September following an interrogation by Public Prosecutor Jamal Al-Hajar and faces multiple charges, most notably his involvement in a suspicious deal between financial services and brokerage company Optimum Invest and Lebanon’s Central Bank during his tenure as governor.

On Monday, investigative judge Bilal Halawi ordered Salameh to remain in detention after questioning him for the first time since being taken into custody, reported. Another hearing is scheduled for Thursday.

Salameh also faces accusations including embezzlement, money laundering, illicit enrichment, forgery, and theft of public funds, further complicating the case against him, as he is considered by many Lebanese as one of the main instigators of Lebanon’s financial crisis and the collapse of the Lebanese currency. He has repeatedly denied these accusations.

In 2023, Interpol arrest warrants were issued against Salameh by Germany, France as well as the US, the UK, and Canada over accusations that he illegally accumulated real estate and banking assets to the tune of $110 million, according to , with the latter three countries imposing sanctions on him and his family members.

Possible scenarios following Salameh's arrest

Following his questioning on Monday Salameh will remain in detention until his next hearing, which is scheduled for Thursday, according to .

Lebanese lawyer Wadea Aqel explained to °®Âţµş that the judge will have one of two options.

“The first option is to issue an arrest warrant, which would send Salameh to prison for a temporary period ranging from four to six months until he is indicted and possibly sentenced to up to ten years in prison,” Aqel said.

The second option, according to the lawyer, is to release him conditionally, in which case the Prosecutor will appeal the decision, which will be adjudicated by the Indictment Chamber’s Judge Maher Cheaito, who will make the final decision.

On an international level, Aqel noted that Salameh is being pursued in 13 countries, including the United States, which means that these countries could request an expansion of the investigation or submit direct interrogation requests.

“But all interrogations will be conducted exclusively in Lebanon,” Aqel said, refuting rumours that Salameh is being interrogated in Lebanon to thwart an overseas trial.

Aqel believes that a judge should order a search of his home to confiscate the allegedly large quantities of money, gold, jewellery, and art, along with numerous documents, before they are smuggled out by his guards.

“One of the Prosecutor’s options is to order that his house be sealed with red wax,” said Aqel.

Will political interventions obstruct the investigation?

Concerns about the politicisation of the investigation, given Salameh’s large banking network connected to him, are valid, says Aqel.

“But the international spotlight is now focused on Lebanon, so any attempt to protect Salameh could put those involved under international scrutiny,” the lawyer added.

Political analyst and commentator Youssef Diab, however, believes that Salameh is part of the political systemĚýand that politicians will naturally intervene to secure his release.

“The trajectory of this case will depend on the nature of Salameh’s interrogation and whether he will disclose information about his collaborators in this corrupt system,” says Diab.

Diab emphasised how the element of surprise in Salameh’s arrest played a crucial role in the current situation.

“If the political elites had known that he was being summoned for investigation, they wouldn’t have allowed him to attend the interrogation,” says Diab.

He points out that Salameh himself did not anticipate this.

“He was so confident that he was being summoned to provide testimony on cases unrelated to him that he didn’t even tell his lawyer,” says Diab. The surprise stemmed from the findings of the , which contained documents reinforcing suspicions against him, explained Diab.

Salameh and the Lebanese judiciary

Judicial sources confirm that what is happening now is merely the beginning of a long process that will expose other corrupt officials. The Minister of Justice in the current caretaker government, Henri Khoury, said in a statement that "the Riad Salameh file has taken its correct legal course … the role of the state is to protect public funds, and the judiciary has made its decision”.

Diab says that Salameh’s case is a turning point in the Lebanese judicial system, but its value will be limited. Diab believes that it is not enough for the investigations to stop at Riad Salameh alone.

“Salameh’s arrest,” says Diab, “is a lesson to any bank director or anyone holding public office: You must calculate every step you take, especially when it involves public funds”.

Economist Mounir Younes, however, believes that the unfolding legal drama is a response to international pressure on Lebanon, including the threat of putting the country on the Financial Action Task Force’s (FATF) in October due to a widespread failure to tackle money laundering.

“This pressure,” says Younes, “pushed the Lebanese judiciary to make the arrest to signal to the international community that it is seriously pursuing financial crimes.”

But Younes stresses that this step is not sufficient.

“Full justice requires accountability and an evidence-based explanation of how around $100 billion of depositors' money, and public funds, were squandered. If the investigation is limited to Riad Salameh alone, the full truth will not be revealed,” says Younes.

Younes believes that Salameh's arrest will not directly impact Lebanon's economic situation or the recovery of depositors' funds unless all files related to the Central Bank are thoroughly investigated, not just the files related to Optimum Invest and the alleged $8 billion in commissions that he accrued.

“Uncovering the truth about the depositors' funds requires opening other files, such as the financial engineering operations, Lebanese dollar accounts [lollars], subsidies, and the transfer of funds abroad,” says Younes, noting that addressing these issues would make the search for depositors' funds possible.

A full audit of the Central Bank's accounts with complete transparency is the only way to enable the recovery of funds if they exist, says Younes.

“We should learn from Iceland’s experience,” says Younes, recounting how the Scandinavian country created a parliamentary fact-finding committee and conducted a strong judicial process with the assistance of 30 international judges to uncover a large-scale corruption ring.

“Such a committee will assign responsibilities, conduct swift audits and investigations, and eventually lead to a fair resolution for depositors, ending the crisis in 3-4 years,” says Younes, expressing his concern that opening major financial files would lead to scandals that will further destroy the financial system.

“My fear is that if Lebanon is put on the grey list, receiving remittances from abroad will become more difficult, and moving to the black list could result in an even greater economic catastrophe,” he says.

This article is published in collaboration withĚý.