When Khalifa Haftar launched his tank columns toward Tripoli in 2019, he wasn't just burning fuel and ammo. He was burning through a massive pile of borrowed cash that he never intended to pay back. While the world watched the frontline skirmishes, a much quieter and more dangerous operation was happening in the backrooms of Gulf banks.
A fresh investigation by The Sentry has pulled back the curtain on Ahmed Gadalla, a man known in eastern Libya as "Ahmed Alushibe." Before the 2019 assault, Gadalla wasn't exactly a household name, but he became the financial engine for the war effort. He didn't just find a few million under a mattress. He managed to secure $300 million in loans through a network of shell companies in the United Arab Emirates.
The kicker? That money is still missing, and you’re the one footing the bill if you live in Libya. These loans were backed by the Libyan Foreign Bank (LFB), meaning the national wealth was used as collateral for a private war that tore the country apart.
How the $300m shell game worked
War is expensive. Keeping thousands of soldiers fed and paid, while also hiring foreign mercenaries like the Wagner Group, requires liquid cash. Gadalla’s strategy was brilliant in its simplicity and devastating in its execution.
He used companies based in the UAE to borrow $300 million from the Abu Dhabi-based Arab Bank for Foreign Investment and Trade, often called al-Masraf. Because these loans were "guaranteed" by the Libyan Foreign Bank, the risk didn't fall on Gadalla or Haftar. It fell on the Libyan state. When the offensive stalled and eventually collapsed in 2020, those loans didn't just disappear. They became a lead weight on Libya's public finances.
- The Funding Loop: Public money (LFB) was used to guarantee private loans.
- The Expenditure: Cash was funneled into the LNA's war chest, likely paying for Wagner fighters and UAE-supplied hardware.
- The Aftermath: The loans remain unpaid, and Gadalla has transformed into the dominant economic force in eastern Libya.
The rise of eastern Libya’s top money man
Most people who fail at a $300 million business venture go broke or go to jail. Not Gadalla. Instead of facing consequences, he’s spent the last few years consolidating power under the protection of Saddam Haftar, the field marshal’s son.
He now effectively controls the Bank of Commerce and Development (BCD), along with significant influence over Wahda Bank and National Commercial Bank. This isn't just about prestige; it's about control over the lifeblood of the eastern economy. Through these banks, Gadalla is accused of facilitating massive letter-of-credit fraud and laundering illicit profits.
Perhaps the most brazen part of this operation is the circulation of counterfeit Russian-printed dinars. By flooding the market with these notes, Gadalla and his associates have systematically undermined the value of the local currency. If your money buys less at the grocery store today, this is one of the reasons why.
Smuggling arms and breaking embargos
It’s not just about the money. The Sentry’s report links Gadalla to the Haftar family’s transnational arms smuggling operations. Despite a long-standing UN arms embargo, military hardware keeps flowing into eastern Libya.
Gadalla allegedly acts as the logistical and financial architect for these shipments. He arranges the intricate payment structures and the "dark" shipping routes needed to move weapons without triggering international alarms. He’s essentially become a one-man procurement office for a private army, all while sitting in a boardroom.
Why nobody has stopped him
You’d think a guy tied to $300 million in unpaid state-guaranteed loans and international arms smuggling would be an easy target for sanctions. But Libya’s political situation is a mess of "stable" instability.
The Haftar family has entrenched itself so deeply into the economic fabric of the east that removing a figure like Gadalla would risk a total banking collapse in the region. He’s become "too big to fail" in a very literal, very dangerous sense. International actors have also been slow to move, often prioritizing short-term oil stability over long-term financial accountability.
The real cost of the Tripoli offensive
The $300 million is just the tip of the iceberg. The 2019-2020 war caused billions in infrastructure damage and cost thousands of lives. But the financial legacy is what's strangling Libya's future.
When a financier can hijack the national bank's credit to fund a coup attempt—and then get promoted for it—the message is clear: the law doesn't apply to those with the right connections. This kleptocratic system doesn't just steal money; it steals the possibility of a functioning state.
What needs to happen next
If you're looking for a way out of this cycle, the steps aren't complicated, but they are difficult.
- Demand a full audit: The Libyan Foreign Bank needs a transparent, international audit of all guarantees issued between 2018 and 2020.
- Sanction the enablers: International authorities, specifically in the US and EU, need to look past the political leaders and target the "money men" like Gadalla who make these wars possible.
- Unified Banking: Libya cannot survive with two parallel banking systems that allow financiers to play one side against the other.
The $300 million isn't coming back on its own. It's buried in UAE bank accounts, Russian printing presses, and the pockets of those who profit from Libya's chaos. Stopping the next war starts with following the money from the last one.
