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US: Iran Could Use Fraud to Evade Sanctions

US: Iran Could Use Fraud to Evade Sanctions

Saturday, 13 October, 2018 - 05:15
Washington - Muath al-Amri
The United States has warned the world’s banks that Iran might try to use “deceptive practices” to soften the effect of sanctions, weeks before Washington is set to reimpose further measures against Tehran.

“This advisory lays out in great detail the extent to which the Iranian regime uses deceptive practices, including front companies, fraudulent documents, exchange houses, seemingly legitimate businesses and government officials, to generate illicit revenues and finance their malign activities,” said a statement issued by the US Treasury.

Such practices have been orchestrated not only by elements of the Iranian government such as the IRGC-Qods Force, but also by Central Bank of Iran officials, it said.

“Any country that allows its Central Bank to be involved in deception in support of terrorism requires the highest levels of scrutiny, particularly when the country itself is the world’s largest state sponsor of terrorism,” said Sigal Mandelker, Under Secretary of the Treasury for Terrorism and Financial Intelligence.

She said the advisory is intended to help foreign financial institutions better understand the obligations of their US correspondents, to avoid exposure to US sanctions, and to address the Anti-Money Laundering/Combating the Financing of Terrorism (AML/CFT) risks that Iranian activity poses to the international financial system.

“Crucial insight provided through Suspicious Activity Reports (SARs) and other valuable information conveyed by the financial sector have been instrumental in identifying money laundering and other financial schemes associated with the Iranian regime,” added FinCEN Director Kenneth A. Blanco.

“This advisory focuses financial institutions’ attention on the current risks associated with transactions involving the Iranian regime. It also provides concrete red flags and typologies to help them identify potentially illicit Iran-linked activity. In so doing, this advisory not only increases industry awareness; it also enhances the future value of related SAR reporting and ultimately strengthens the safety and security of the US financial system.”

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