A Russian-Syrian business network run by a prominent Syrian businessman was responsible for the transfer of millions of dollars to the Assad regime and the development of its chemical weapons arsenal, an investigative report revealed yesterday.
According to the report published by Global Witness, an international campaign group which traces money involved in corruption through the electronic banking system, the businessman named Mudalal Khouri managed to provide the enormous funds for the regime by using a variety of Moscow-based front companies and tax havens in British Overseas Territories. He also headed the acquisition of raw materials and equipment used for the development of chemical weapons.
Khouri, who moved to Russia in the 1970s during its Soviet era, reportedly ran a vast business network along with his brothers Imad and Atiya. The network consists of a variety of enterprises in the property market, banking, online payment systems, as well as a kebab business, all managed by members of the Khouri family and the recently side-lined Makhlouf family.
The Khouri network, for example, helped the Makhlouf family purchase $40 million of property in Moscow and one of the Khouri brothers reportedly used the network to channel funds towards the Syrian central bank and Syria's state oil company.
One enterprise is being carried out by a daughter of Khouri named Sandra, who is an alumna of the London School of Economics (LSE), has an apartment in the central London's Mayfair, and is currently attempting to set up a Russian equivalent of Paypal.
Other businesses within the network include Piruseti Enterprises and Frumineti Investments, both of which are registered in Cyprus and are run by a Khouri-affiliate named Issa Al-Zeydi from Moscow. There is also the organisation named Tredwell Marketing, owned by a Syrian kebab chef based in Moscow and registered in the British Virgin Islands.
The companies have been responsible for the transfer of vast sums of money, with Global Witness estimating that the network as a whole could have handled up to $4 billion. One company named Balec Ventures, also owned by A-Zeydi, reportedly had $500 million transferred through it between the years of 2006 and 2014.
One of the most prominent and controversial activities conducted by some of the aforementioned companies was their partnership with and aid of Syria's Scientific Studies and Research Centre (SSRC), the institute set up by President Bashar Al-Assad's father Hafez which leads the regime's development of chemical weapons.
Despite Al-Assad having largely destroyed much of his chemical weapons stock in 2013 due to international demand and outrage following their use on Syrian civilians and their prohibition under international law, the SSRC operates to this day and is speculated to still be developing its chemical arsenal.
Due to their involvement in financing the Assad regime and its productions of chemical weapons, many of these companies and individuals – including Mudalal Khouri himself – have been sanctioned by the United States starting from 2014 and 2015.
The investigation's revelation of the business network and its activities sheds more light on how the Assad regime is attempting to circumvent sanctions imposed by the international community, the latest of which are the sanctions implemented under the Caesar Act by the US last month.
Although such sanctions restrict the regime's economic activities and its ties with other states and entities, it shows that it is still largely able to acquire millions of dollars from its affiliates around the world, as well as from black market activities such as international drug smuggling in order to fund its military efforts in the ongoing Syrian civil war.