Risky Business: More Broken Promises by Iranian Regime

Tehran Fails to Meet International Banking Standards; Time to Take “Swift” Action

More than two years ago, Iranian officials promised the Financial Action Task Force (FATF) that Tehran would bring its banking laws up to international standards to protect against money laundering and terrorism financing. To date, none of the reforms that Iran said that they would institute have been fully enacted. Unsurprisingly, at the recent FATF Plenary in Paris, the organization found that the protection afforded to the international financial system by Iran’s laws continues be woefully deficient.

The FATF’s finding that Iran has not fulfilled the 10 promises it made to pass and enforce laws against financing terrorist groups comes as another critical institution, the Society for Worldwide Interbank Financial Telecommunication (SWIFT), considers whether it disconnects Iran from its system. Doing so would protect all other banks from potentially processing transactions that fund terrorism.

SWIFT, the Belgium-based financial messaging system for banks providing cross-border transfers for its members across the globe, is under pressure to disconnect the Central Bank of Iran and other sanction-designated banks from using its system prior to the re-imposition of U.S. sanctions against Iran on November 4. Echoing its successful 2012 campaign, United Against Nuclear Iran (UANI) is in contact with the American and European member banks on the SWIFT board of directors and urging them to take “swift” action.

“Tehran’s laws against money laundering and terror financing are not up to FATF standards. This makes it impossible for Iranian banks, as SWIFT customers, to ensure that no laws, regulations or third-party rights are violated.  Under the rules governing SWIFT, the banks sitting on its board of directors have a clear justification to disconnect Iran from the SWIFT network. It is time to act,” said UANI President David Ibsen.

If SWIFT fails to disconnect Iran from its system, the U.S. may impose financial sanctions on individuals who serve on SWIFT’s board of directors. UANI CEO Ambassador Mark D. Wallace, and UANI Chairman and former U.S. Senator Joe Lieberman recently signed a letter along with other foreign policy experts urging the Trump Administration to do exactly that.

“The threat of Iranian terror globally justifies any threats and actions against countries and financial institutions that aren’t complying with U.S. sanctions, including SWIFT,” said Ibsen.

The case against Iran is clear. Iran proudly funds terror proxies, namely Hezbollah, Hamas, Islamic Jihad, and Shiite militias. There are no prohibitions against Iranian banks due to funding these groups. In fact, the former head of the Central Bank of Iran, Valiollah Seif, was designated by the U.S. Department of the Treasury as a “specially designated global terrorist” after he used his office to funnel money from Iran’s Islamic Republican Guard Corps (IRGC) through al-Bilad Islamic Bank in Iraq to help Hezbollah. And the current governor of Iran’s Central Bank, Abdolnaser Hemmati, served as the CEO of Sina Bank from 2006-2013. The U.S. Treasury Department recently sanctioned Sina Bank under Executive Order 13224 for its role in a network connected to an Iranian paramilitary force which recruits child soldiers.

Recently, the U.S. also concluded that the IRGC is supporting and training Afghan fighters, including children. There are some 14,000 U.S. military personnel supporting the Afghan military in its fight against the Taliban, Al Qaeda, and the Islamic State in Iraq and Syria (ISIS).

“The banks that make up SWIFT’s board of directors are out of time and excuses. After more than two years of making empty promises, the FATF has confirmed that Iran has done nothing to reduce the risks that it poses to the international financial system. Iran must be disconnected from the system immediately,” said Ibsen.