Exclusive: Husni Bey Explains the Implications of the US Federal Reserve Freezing the Central Bank’s Accounts

Libyan businessman Husni Bey told our source exclusively:

“Setting personalities entirely aside, who remains governor, who leaves, and who assumes interim management—the recent developments at the Central Bank of Libya confirm a fact we must not ignore: the Central Bank’s stability abroad depends to a great extent on the legitimacy and soundness of procedures within Libya.

“The decision issued by the Presidency of the House of Representatives on October 22, 2026, provisionally accepted Governor Naji Issa’s resignation ‘in principle’ and assigned Dr. Fawzi Misbah Abukhzam to temporarily perform the governor’s duties, pending the submission of the resignation to the House of Representatives and a final decision in accordance with the legislation in force.

“Meanwhile, Mohamed Takala, President of the High Council of State, supported Abukhzam’s temporary assumption of the duties until an agreement could be reached with the House of Representatives. However, the Council’s First Deputy President announced his rejection of the decision, describing it as a unilateral measure. This disagreement is not merely a symbolic political dispute.

“The governor of the Central Bank of Libya holds a sovereign position whose appointment mechanism is regulated by the Libyan Political Agreement, which requires consensus between the House of Representatives and the High Council of State. This mechanism was reaffirmed in practice by the September 2024 agreement under which the Bank’s current leadership was appointed, pursuant to Article 15 of the Political Agreement.

“The real question, therefore, is not who the governor is, but whether the procedures for dismissal, acceptance of resignation, interim appointment, or permanent appointment complied with the constitutional, legal, and consensus-based framework recognized both inside and outside Libya.

“This question has become more urgent following press reports—which have not been conclusively confirmed by an official decision from the Federal Reserve—indicating that the Central Bank of Libya’s accounts at the US Federal Reserve were subject to a temporary precautionary freeze because of uncertainty over which authority was entitled to approve financial transactions.

“Until the Federal Reserve issues an official statement, these reports must be treated with caution. Nevertheless, they reflect a genuine risk: any ambiguity over who has the legitimate authority to sign off on the state’s funds can immediately become an international banking problem.

“Before these developments, an official US communication had expressed concern about the recent events at the Central Bank, warning that undermining its technocratic cohesion and independence could threaten Libya’s financial and economic stability.

“The international financial system does not care who we personally prefer as governor. Correspondent banks, the Federal Reserve, and international financial institutions ask simpler but more stringent questions: Who has legal standing? Who has signing authority? Was the transfer of power carried out in accordance with the law? And is there a single authority recognized internationally that can issue binding instructions on behalf of the Central Bank of Libya?

“Reducing this issue to a conflict between individuals would therefore be a serious mistake. The priority now must be to eliminate any doubt about the Bank’s legal status and complete the procedures in accordance with the Constitutional Declaration and its amendments, the Libyan Political Agreement, applicable banking legislation, and consensus between the two competent institutions.

“It is not enough for a decision to be politically defensible domestically; it must also be legally defensible before the international financial system. The Central Bank of Libya is not a local ministry whose management dispute affects only domestic affairs. It is the institution responsible for managing reserves, oil revenues, external payments, letters of credit, and relations with correspondent banks and the global financial system.

“Any challenge to the legitimacy of its leadership could therefore carry a cost far greater than the political dispute that gave rise to it.

Conclusion

“Regardless of whether the individuals involved are Naji Issa, Fawzi Abukhzam, or anyone else, the priority must be to respect the mechanisms of consensus and the law.

“The phrase ‘temporary arrangement’ or the ‘provisional acceptance of a resignation’ must not become a means of bypassing the legal framework on which the legitimacy of the Bank’s leadership was originally established.

“The objective is not to secure victory for one side, but to protect the Central Bank of Libya from becoming the subject of an international dispute over its legitimacy.

“Political disagreements can be resolved tomorrow. Losing international confidence in the Central Bank and its authority to manage Libya’s funds, however, could carry a cost that is both faster to materialize and far greater in scale.

“Procedural legitimacy is not a constitutional luxury; it is part of the state’s financial security.”