Lebanese prime minister sues cash strapped AUB for $1 million cash

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Hind Al Soulia - Riyadh - Lebanon’s Prime Minister Hassan Diab is demanding $1 million (Dh 3.67m) from the cash-strapped American University of Beirut to cover his expected salary until 2025 despite leaving late last year to run the country.

Two AUB sources told The National that Mr Diab has now filed a lawsuit against AUB over demanding he is paid his annual salary of $200,000 for the next five years.

Just last month, the institution’s head Fadlo Khury laid out the dire state of AUB’s finances, battered by the economic crisis and the Covid-19 pandemic. He said that departments would have to close and up to a quarter of staff laid off.

The news that the prime minister, brought in to head a technocratic government that can halt the country’s total economic collapse, is now suing his old employer has left staff reeling.

“He thinks he’s entitled to this money that he never worked for and he’s obviously using his status as prime minister to bully the university,” said one AUB faculty member. “He wants all the payments outside [Lebanon], in dollars, while we are struggling to keep the university open.”

A man on his scooter passes next to garbage containers and tires that were set on fire by anti-government protesters to block the main road in Beirut, Lebanon. Protesters closed several major roads in the Lebanese capital amid rising anger as the currency hit a new record low on the black market, electricity cuts increased and the government raised the price of bread for the first time in more than a decade. AP Photo

Smoke from burning garbage bins set on fire by anti-government protesters block a main road of the city cause traffic jam during a protest over deteriorating living conditions in Beirut, Lebanon, after the Lebanese government had raised subsidized bread prices. EPA

Smoke from burning garbage bins set on fire by anti-government protesters block a main road to the city's airport during a protest over deteriorating living conditions in Beirut, Lebanon, after the Lebanese government had raised subsidized bread prices. EPA

Demonstrators start a fire during a protest over deteriorating living conditions and after the Lebanese government raised subsidised bread prices, in Beirut, Lebanon. REUTERS

People pass garbage containers and tires that were set on fire by anti-government protesters to block the main road in Beirut, Lebanon. AP Photo

A woman, left, takes photos with her phone of her relative on his scooter in front of burned tires and garbage containers set on fire by anti-government protesters to block roads, during a protest against the economic crisis, in Beirut, Lebanon. AP Photo

Anti-government protestors have garbage bins set on fire to block a road during a protest over deteriorating living conditions in Beirut, Lebanon. EPA

A woman passes in front of burned tires and garbage containers set on fire by anti-government protesters to block roads, during a protest against the economic crisis, in Beirut, Lebanon. AP Photo

An anti-government protester burns tires and garbage containers to block roads, during a protest against the economic crisis, in Beirut, Lebanon. AP Photo

Anti-government protesters burn tires and garbage containers to block a main road, during ongoing protests against the Lebanese government, ,in Beirut, Lebanon. AP Photo

Lebanese army soldiers deploy on a street where anti-government protesters block a main road with garbage containers, during ongoing protests against the Lebanese government, in Beirut, Lebanon. AP Photo

Anti-government protesters block a main road with garbage containers, in Beirut, Lebanon. AP Photo

People queue to buy bread at a bakery in Beirut, Lebanon. REUTERS

A Lebanese woman checking a page where Lebanese people exchange their goods with food, baby clothes and diapers. Tens of thousands of people across the social spectrum have lost their job or part of their income as part of Lebanon's worst economic crisis in decades. As Lebanese parents watch prices soar amid a historic low for the local currency on the market, they are taking to bartering online to survive. AFP

A spokesman for Mr Diab declined to comment and his lawyers did not respond in time for publication.

Potentially more damning for the prime minister is the allegation he demanded the money be paid in US dollars to an overseas account.

Since October, the Lebanese lira has dropped from the official peg of 1,507 to the dollar to upwards of 9,000 to the dollar. In November, two weeks after nation-wide protests erupted because of the crisis, local banks capped cash dollar withdrawals and barred overseas transfers.

My whole salary is worth about $6,000 on the black market

AUB staff member

The AUB source said that Mr Diab had verbally asked the university’s board of trustees to pay the $1 million into a foreign account. “It’s incriminating, you don’t write that down,” the source said.

Mr Diab’s extensive 134-page CV shows that he worked at AUB for 35 years, first as an assistant professor at the faculty of engineering and architecture before he was appointed vice-president for AUB’s regional external programs between 2006 and 2011, a position he returned to in 2013 after serving as education minister.

Ministers in Lebanon continue to accrue a salary even after leaving office as will Mr Diab in his position as prime minister on 17.7m lira a month, which at the official peg equates to around $11,687.

Mr Diab took office on January 21 and vowed a raft of urgent reforms and fixes to slow the collapsing lira and begin shoring up the battered economy. As he marked 100 days on May 21, he said he had completed almost all of those urgent tasks despite the lira continuing to decrease in value, companies continue to lay off staff or close and despite the poverty rate continuing to rise above 40 per cent of the population.

American dollars, which used to be used in parallel with the local currency, have all but disappeared locally and inflation has risen from 17.5 per cent in February to an eye-watering 56 per cent in May.

AUB grants two years of unpaid leave to employees who are appointed to positions in government.

Mr Diab benefitted from this leave – which can be extended – during his stint as education minister from 2011 to 2014. But he did not request it when he became prime minister, the AUB source said.

In early May, AUB President Fadlo Khury wrote an open letter saying that the university was facing its “greatest crisis since [its] foundation in 1866”.

He blamed Lebanon’s “economic meltdown, the Covid-19 pandemic, and the expected global economic depression”.

The university remained open throughout much of the 1975-1990 Lebanese civil war, providing an oasis of calm and greenery even as a number of foreign staff members were kidnapped or killed.

Mid-June, Mr Khury announced that up to 25 per cent of AUB’s staff would be laid off and that they would receive severance packages in Lebanese pounds.

“If I tell you [the amount of] my paycheck for next year, you’ll laugh,” said the AUB source, who has so far kept their job.

“My whole salary is worth about $6,000 on the black market.”

Updated: July 8, 2020 09:47 PM

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