A Lebanese art collector accused of financing the militant group Hezbollah evaded U.S. sanctions using a complex web of businesses to disguise millions of dollars in transactions involving art and diamonds, according to an indictment unsealed in Brooklyn federal court on Tuesday.
Nazem Ahmad and eight others were also charged with conspiring to defraud American and foreign governments and money laundering. His accountant, Sundar Nagarajan, was arrested in Britain on Tuesday at the request of American prosecutors; the remaining defendants, including Mr. Ahmad, are at large outside the United States, the authorities said.
The indictment was part of a raft of actions aimed at Mr. Ahmad’s global operations, all announced on the 40th anniversary of an attack on the U.S. embassy in Beirut that killed 63 people, which the United States blames on Hezbollah. The group, which is both an armed movement and a political party, is supported by Iran and designated a terrorist organization by the United States.
The Treasury Department’s Office of Foreign Assets Control announced sanctions against 52 individuals and entities linked to Mr. Ahmad in nine countries, emphasizing that the murky nature of the art and luxury goods markets had been used to launder illicit proceeds.
“Luxury good market participants should be attentive to these potential tactics and schemes, which allow terrorist financiers, money launderers, and sanctions evaders to launder illicit proceeds through the purchase and consignment of luxury goods,” Brian E. Nelson, the Treasury Department’s undersecretary for terrorism and financial intelligence, said in a statement.
In a coordinated action, the British authorities froze Mr. Ahmad’s assets on Tuesday. The authorities said he had an extensive art collection and business in Britain with many artists, galleries and auction houses.
In December 2019, the Treasury Department charged that Mr. Ahmad was one of Hezbollah’s top donors and traded in what are known as “blood diamonds,” or gems that are sold to fuel wars.
His extensive art collection at the time included works by Picasso and Warhol, and many were displayed in his Beirut penthouse, the department said, calling his purchases of high-value art a “pre-emptive attempt” to get around sanctions. He was accused not just of funding Hezbollah, but also personally providing funds to its leader, Hassan Nasrallah.
Mr. Ahmad has maintained a lively presence on Instagram, where he has 172,000 followers and posts works by artists like Jean-Michel Basquiat and Barbara Kruger.
The sanctions prohibited Mr. Ahmad from engaging in most transactions with people in the United States, but he continued trading under the cover of corporate entities based in various countries as well as individuals, prosecutors contend.
Those people included his daughter Hind Ahmad, 30, who runs galleries in Lebanon and Ivory Coast. In a phone interview from Beirut late Tuesday, Ms. Ahmad vigorously disputed the allegations. She said she was unaware of the case in federal court and had only just learned that she and her galleries were named in the Treasury Department’s announcement.
“I would have never imagined this would ever be possible,” she said.
She said the notion that her father was a financier for Hezbollah was absurd. She said the allegations sounded like a fantastical Bollywood movie, and she believed they stemmed from lies told by rivals in Lebanon.
Her father, 58, had faced similar charges in Belgium years ago and was declared innocent, she said. She added that she is due to give birth in two weeks.
A lawyer that she said represents her father in the United States did not immediately return a call for comment.
The investigation by the office of the U.S. attorney in Brooklyn uncovered about $440 million worth of imports and exports, primarily of artwork and diamonds, to the United States by entities linked to Mr. Ahmad after the sanctions were imposed. About $160 million worth of transactions went through the U.S. financial system.
Prosecutors said the Eastern District had jurisdiction because, among other reasons, diamonds and artwork traveled through Kennedy International Airport.
The Justice Department’s Office of International Affairs is assisting with extradition in the case; Lebanon does not have an extradition treaty with the United States, but other countries cited in the indictment do.
The defendants used a U.S.-based diamond-grading service to set prices for about 1,546 carats of diamonds, according to the indictment. In March 2021, they had a 45-carat diamond valued at $80 million shipped to New York to be graded.
They also are accused of obtaining more than a million dollars’ worth of art from the United States — though they undervalued the work to avoid tariffs, the indictment said.
The transactions cited included several with a Chicago art gallery and others in New York. One piece, by the Chicago-based artist Luke Agada, was purchased with a wire transfer through an American banking institution, the indictment said.
Mr. Ahmad had posted an image of it on Instagram about 10 months ago. It depicts a woman with an old-fashioned telephone atop her head, holding a cardboard box marked “EVIDENCE.”
