Last week, the Canadian government issued its 2025 report assessing money laundering and terrorist financing risks in Canada. The report noted that Hezbollah was using both illicit and otherwise legal channels in the country to fund its activities in Lebanon—including exploiting the charitable and non-profit sectors and trade-based money laundering techniques.
One noted example was Hezbollah’s continued utilization of the used car trade to raise revenue. The report stated that the Port of Montreal in Quebec Province is a “known link where luxury vehicles are shipped to Lebanon, financially supporting Hezbollah.”
Hezbollah’s ties to the automobile trade
US law enforcement publicized Hezbollah’s longstanding link to the transnational automobile trade over a decade ago. In 2011, the US district attorney for the Southern District of New York and the Drug Enforcement Administration filed a joint complaint “against a Lebanese bank and a network of Hezbollah-connected companies, including U.S. shipping and used-car firms.”
The suit alleged, among other things, that from January 1, 2007 to early 2011, “Lebanese Financial Institutions” wired at least $329 million to approximately 30 car buyers in the United States—mainly in Michigan, but also in Tennessee, Maryland, and Connecticut— through Lebanese banks and exchange houses for the “Purchase and Shipment of Used Cars to West Africa as Part of [a] Money Laundering Scheme.”
The cars were transported from the United States by Michigan-based transportation company Cybamar Swiss GMBH, LCC, owned by Hezbollah operative Oussama Salhab and his relatives, to West Africa, which is home to a large Lebanese Shiite diaspora with strong links, including financial ties, to Hezbollah. From there, the cash from the sales, along with proceeds from narcotics trafficking, was funneled to Lebanon through a Hezbollah-controlled system of money couriers, cash smugglers, hawalas, and currency brokers, with the group taking “substantial portions of the cash.” Cash was also often received at Beirut’s Rafic Hariri International Airport, where Hezbollah-controlled security safeguarded its passage to the group.
The complaint alleged that this used-car and money-laundering infrastructure was also used to conceal and funnel hundreds of millions of dollars in narcotics proceeds from Latin America and West Africa to Lebanon. Hezbollah couriers were paid fees for facilitating the laundering of the proceeds, which US officials alleged reached as much as $200 million a month in business.
Hezbollah in Canada
Hezbollah has long used Canada as a consistent hub for fundraising and money laundering. One of the financial entities involved in this money-laundering scheme was the now-defunct Lebanese Canadian Bank (LCB), where much of the cash was deposited, and Hezbollah’s Yousser Company and Martyr Foundation maintained accounts among almost 200 other potentially Hezbollah-linked accounts. Based in Beirut, LCB was founded in 1960 as Banque des Activities Economiques SAL and was a subsidiary of the Royal Bank of Canada Middle East from 1968 to 1988, prior to becoming a privately owned Lebanese bank. The bank maintained 35 branches in Lebanon and a representative office in Montreal, Canada.
However, Hezbollah’s presence in Canada predates the revelation of the scheme involving LCB by over a decade. In October 2002, Canadian Security Intelligence Service (CSIS) documents revealed that Hezbollah had been using Canada as an offshore base for raising money and purchasing supplies to conduct and record attacks against Israel. The group laundered tens of thousands of dollars through Canadian banks while drawing on the accounts to buy military equipment.
These operations stretched back at least to the early 1990s, involving Lebanese Shiite Hezbollah operatives who had immigrated to Canada with their families. They used Canada to buy materiel, forge travel documents, raise money, and steal luxury vehicles—activities similar to those noted in the 2025 report. Per CSIS, in 1999 and 2000, Hezbollah directly sent “shopping lists” to these agents operating as part of its networks in Vancouver and Montreal, who filled the orders and sent the equipment back to Lebanon in courier packages.
Additionally, these networks used Canadian banks, like Bank of Nova Scotia, to move hundreds of thousands of dollars to finance purchases for Hezbollah. They also took out life insurance policies on Hezbollah operatives who were later killed in clashes with Israeli forces in Lebanon.
As a result, Ottawa proscribed Hezbollah in its entirety on December 10, 2002—but this listing failed to completely curb the group’s activities in Canada or weed out its operatives. In 2011, The National Post reported on Hezbollah’s potential involvement in an extortion racket that, among other activities, used local agents to threaten Lebanese expatriates into purchasing vehicles that were intended to be shipped to Lebanon through the Port of Montreal.
The current significance of vehicular theft for Hezbollah
As a result of its recent war with Israel, Hezbollah is suffering an acute financial crisis. Significant portions of the group’s once-massive arsenal and financial assets were destroyed by the Israelis. More importantly, however, the conflict decimated large swathes of the predominantly Shiite areas of Lebanon in which the group had ensconced itself. Unless the aftermath of this destruction is remedied soon, Hezbollah risks confronting a massive wave of Shiite anger that could deprive the group of critical social support at a time when Lebanon is considering pathways to the group’s disarmament.
A March 2025 assessment by the World Bank estimated that the reconstruction and recovery needs following the conflict stood at $11 billion. Some reports indicate that Iran immediately transferred $1 billion to Hezbollah via a regional country at the onset of the Lebanon-Israel ceasefire on November 27, 2024. However, Iranian funding has been hampered by Tehran’s own financial constraints, the curtailment of Hezbollah’s Syrian lifeline after Bashar al Assad’s downfall, and Israeli operations in Lebanon that have forced Beirut to limit Iranian efforts to finance the group.
This situation has left Hezbollah scrambling for sources of funding to cover the difference. For example, since the November 2024 ceasefire, Hezbollah Secretary-General Naim Qassem has repeatedly placed the onus of rebuilding on the Lebanese government—to shift both the financial burden of reconstruction onto Beirut, as well as the potential public anger if assistance is delayed.
However, the Lebanese government’s ability to finance reconstruction adequately also seems to be a non-starter, as Lebanon’s traditional financiers, like the United States, France, and the Gulf States, have been withholding funding from Beirut for years, absent significant political and economic reforms, including curtailing Hezbollah.
Hezbollah has leaned into its connection with criminal enterprises while being financially constrained in the past. This makes the group’s financial reliance on its network of diffuse operatives in Western countries even more significant—where they can readily take advantage of “strong, open and stable econom[ies] and financial sector[s]” that, per the 2025 report, have made Canada an “an attractive source, destination, and transit point for proceeds of crime for both organized groups and third-party enablers.” Through these networks, only tacitly linked to Hezbollah, the group can exploit the strengths of Western economies and financial streams to raise funds in countries where it is otherwise proscribed.
Canada is considered a hub for automobile theft and international smuggling, and Hezbollah stands to benefit from tapping into that preexisting stream of criminal activity. Per INTERPOL’s 2024 numbers, “Canada ranks among the top 10 countries” for car theft. According to a 2017 study by the Insurance Bureau of Canada, a significant portion of the tens of thousands of vehicles stolen annually in Canada are smuggled abroad by organized crime groups, including to West Africa via Italy and Lebanon.
Meanwhile, in the intervening years, car theft and automobile smuggling to foreign destinations have been on the rise in Canada. The Groupement des asseurers automobiles, a group of automobile insurers in Quebec, noted a 55 percent increase in automobile thefts in the province between 2013 and 2023, in what the Insurance Bureau of Canada subsequently described as a “national crisis.” Other statistics put the number at 58 percent. Ontario Province experienced a 48 percent increase in car theft in the same period.
The Port of Montreal is considered “the principal exit port for stolen vehicles going overseas,” according to the National Odometer and Title Fraud Enforcement Association, which listed Beirut as a significant destination for stolen cars. According to Ben Jillett, a former Royal Canadian Mounted Police officer who now works with the Insurance Bureau of Canada, theft rings will often use stolen identities to lease or buy vehicles on credit and then drive them straight into containers or staging areas for later shipment.
In just one 2024 action, “Operation Vector,” Canadian authorities recovered 598 vehicles valued at $34.5 million that were set to be smuggled through the Port of Montreal for sale in foreign markets, including the Middle East.
The year prior, 1,000 cars were similarly recovered, a “great number” of which were reportedly in the process of being shipped to Montreal. By April 2023, Canadian law enforcement had seized 53 vehicles valued at $2.6 million—mostly new high-end SUVs and pickup trucks—that were loaded onto containers bound overseas.
Hezbollah, as one criminal actor among many tapped into this illicit financial stream, is likely taking only a fraction of the proceeds from the resale of cars successfully smuggled out of Canada. However, even a fraction is significant now, as it allows the group to continue buying time and delaying a potential Shiite backlash until a more permanent solution to its financial constraints presents itself.
David Daoud is Senior Fellow at at the Foundation for Defense of Democracies where he focuses on Israel, Hezbollah, and Lebanon affairs.
Analysis: Hezbollah continues exploiting Canadian vehicular theft and money-laundering schemes
