Text size

Lebanese authorities have arrested a Hezbollah-linked businessman on suspicion of fraud after he invested hundreds of millions of dollars on behalf of wealthy Shi'ites, a political source said on Tuesday.

Salah Ezz el-Din, who is known to be close to the powerful Shi'ite militant organization Hezbollah, was arrested within the last week after he went bankrupt, the source said.

Judicial sources confirmed Ezz el-Din was under investigation for "the crime of fraud of large amounts of money and large cheques". Some Qataris had also invested with him, the political source said.

The case has alarmed senior Shi'ite leaders, fearing a Madoff-style Ponzi scheme that may have destroyed the savings of many Shi'ites in south Lebanon who invested with Ezz el-Din.

The south is struggling to recover from the 2006 Second Lebanon War between Israel and Hezbollah, in which Israel bombed large swathes of the Hezbollah bastion. Ezz el-Din himself is from the southern Lebanese village of Ma'aroub.