Dual Lebanese-U.S. Citizen Pleads Guilty to Money Laundering and Tax Offenses
For Immediate Release
U.S. Attorney's Office, Eastern District of Virginia
ALEXANDRIA, Va. – A dual Lebanese and U.S. citizen who resides in Vienna, Virginia pleaded guilty today to participating in a conspiracy to launder money as part of a decade-long scheme to ship electronics equipment to a Hizballah-owned television station in Lebanon. In addition, the defendant and her husband pleaded guilty to conspiring to commit tax fraud by concealing income from her employment in Virginia.
“For over a decade, Racha Farhat participated in a conspiracy to purchase electronics equipment using the proceeds of illegal activity, which benefited a Lebanese television station owned by Hizballah,” said Raj Parekh, Acting U.S. Attorney for the Eastern District of Virginia. “Working with our law enforcement partners, we will bring to justice those who use the U.S. financial system to further the interests of prohibited entities that engage in unlawful activities abroad.”
According to court documents, Racha Farhat, 44, began laundering money in 2010 and continued to do so until the time of her arrest in February 2021. The scheme involved Farhat receiving money from an unindicted co-conspirator (UCC-1) in Lebanon, which she used to purchase electronics equipment in the United States. Farhat then shipped the items purchased by herself and other co-conspirators overseas, primarily to Lebanon, where UCC-1 supplied at least $175,000 worth of goods to Al Manar TV. Al Manar TV is a Lebanon-based TV station owned and operated by Hizballah. Both Hizballah and Al Manar TV are prohibited entities for a U.S. person to conduct business with under the International Emergency Economic Powers Act (IEEPA).
“This plea is an example of the FBI and our partners using available tools and techniques to investigate criminals who attempt to launder funds through U.S. financial institutions,” said Matthew R. Alcoke, Special Agent in Charge of the FBI’s Washington Field Office Counterterrorism and Incident Management Division. “The FBI will work with our law enforcement partners to bring to justice international money launderers and to deter those who may attempt to perpetrate criminal activity in the U.S.”
In order to facilitate the purchase of electronics equipment in the United States, UCC-1 used a variety of means to transfer money to Farhat that were designed to conceal the money’s origins. Farhat received over $1 million in wire transfers from Lebanon, more than $500,000 of which went into a third-party bank account that actually was controlled by Farhat. Farhat also received nearly $80,000 worth of money orders that were purchased in a way to evade identification reporting requirements.
Farhat received direction from UCC-1 as to what equipment to buy, and she lied to vendors about the intended destination of the items, knowing (or being willfully blind to the fact) that at least some of the money was derived from unlawful activity. Farhat also filed U.S. tax returns for UCC-1 that contained false information and used the refunds generated for electronics purchases.
Farhat and her husband, Hussam Hawi, 46, also pleaded guilty to conspiring to defraud the United States in the collection of income taxes. Farhat and Hawi concealed Farhat’s employment from the IRS, declaring her as a “stay home mom” and failing to declare any of the employment wages she earned for tax years 2015–2019. As a result of these willful misstatements and omissions, Farhat and Hawi received a tax refund each year. They owe the IRS more than $64,000.
Both defendants are scheduled to be sentenced on September 21. Farhat faces a maximum combined penalty of 25 years in prison, and Hawi faces a maximum five years in prison. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.
Raj Parekh, Acting U.S. Attorney for the Eastern District of Virginia; Matthew R. Alcoke, Special Agent in Charge of the FBI’s Washington Field Office Counterterrorism and Incident Management Division; and Darrell J. Waldon, Acting Special Agent in Charge, Washington, D.C. Field Office, IRS-Criminal Investigation (IRS-CI), made the announcement after U.S. District Judge Leonie M. Brinkema accepted the plea.
Assistant U.S. Attorneys Anthony T. Aminoff and Dennis M. Fitzpatrick are prosecuting the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case Nos. 1:21-cr-112 and 1:21-cr-113.
Updated May 10, 2021