Lebanon’s Central Bank has launched a major forensic audit to trace billions of dollars spent during the country’s economic collapse, in a move aimed at recovering looted or misused funds and restoring a measure of accountability to the financial system, Nidaa Al-Watan reported on Monday.

The central bank is coordinating with the Ministries of Finance and Justice to appoint an international auditing firm through a public tender to trace the flow of funds used to support the exchange rate and finance imports of essential goods, including food and fuel, between October 17, 2019, and the end of 2023.

Some observers have linked the audit to Law 240/2021, passed to investigate the path of support funds, but central bank sources stress that the current investigation goes beyond that legislation. The audit will conduct a comprehensive forensic review of all central bank expenditures during the collapse.

The audit will examine not only support funds but all sums spent by the central bank during the period, including transfers made on behalf of the state or through correspondent banks, as well as other payments that may have disrupted relations between Lebanese banks and foreign financial institutions. According to internal estimates obtained by Nidaa Al-Watan, the total under review is around $16.4 billion.

The investigation will focus on identifying the ultimate beneficiaries of these funds to ensure that subsidies were used as intended: merchants were expected to import the required goods and sell them at subsidized prices. Findings will be forwarded to the Ministries of Finance and Justice for legal action if irregularities or fraud are detected.

Early leaks about the audit prompted panic among some major merchants, who reportedly lobbied government figures to halt the investigation on grounds it would harm Lebanon’s economic image. The central bank has resisted these pressures, and the process is moving forward without delay. Sources emphasized that compliant merchants and banks that conducted legitimate transactions will face no consequences.

Observers note that the audit raises broader questions about the origin of Lebanon’s subsidy program. Legal experts say the government had no statutory authority under the Currency and Credit Law to direct the central bank to fund specific sectors or commodities. Instead of borrowing from the central bank to fund a structured program, the government issued informal instructions that the central bank implemented without legal mandate.

As a result, roughly $9 billion of depositors’ money was spent on a poorly regulated support program: some citizens benefited from subsidized prices, some merchants realized extraordinary profits, and a political faction gained populist leverage, all while the central bank violated its own rules and lost the ability to reclaim the funds.

Sources stress that the forthcoming audit will clarify the facts, including the companies, profits, and money flows involved. However, questions of political and administrative responsibility remain: where were government officials and central bank managers during this period? Where was Parliament and its oversight committees? And where were those who claimed to champion depositors’ rights while publicly theorizing about the misuse of funds?

Analysts say the audit also exposes the intertwining of financial and political interests. Authorities appear to have prioritized short-term political appeasement over proper oversight, while Hezbollah and allied actors allegedly diverted subsidized goods, including fuel, to Syria. The result, sources say, is a financial disaster whose cost has fallen on Lebanese depositors.

The central bank maintains that the goal of the audit is to recover funds, not punish, and has vowed to pursue the investigation to its conclusion.