American Legislators: FATF Restrictions Against Iran Should Be Reinstated

Ed Royce, Chairman of the House Foreign Affairs Committee, and Rob Portman, Chairman of the Senate Permanent Subcommittee on Investigations, called on the Trump administration in a letter on Thursday, June 21, to work towards reinstating the Financial Action Task Force (FATF) sanctions against Iran. These two members of Congress urged Steven Mnuchin, the U.S. Treasury Secretary, to use his influence to encourage FATF member countries to prevent Iran from accessing the international financial system. The FATF meeting is scheduled to be held next week in Paris. According to Reuters, the FATF, established in 1989, monitors international standards against money laundering and the financing of terrorism and weapons of mass destruction. In their letter, Royce and Portman referenced the findings of a Senate subcommittee investigation regarding the issuance of a 'secret license' for currency conversion for Iran by the Obama administration in 2016, emphasizing the significance of the upcoming FATF meeting. The subcommittee's report stated that the license was issued after the nuclear agreement between Iran and six world powers, known as the JCPOA, allowing Tehran to convert about $6 billion of its funds held in a bank in Muscat, Oman, into U.S. dollars. The two Congress members wrote that the Obama administration unreasonably provided a wide range of economic concessions, including through the FATF, to preserve the severely flawed nuclear agreement. In July 2016, due to 'Iran's commitment to implementing these measures' and 'taking necessary steps,' the FATF decided to keep Iran on the blacklist while suspending sanctions against it. Over the past two years, the enforcement of restrictions against Iran has been suspended during FATF meetings. Royce and Portman stated that every six months for the past two years, actions against Iran have been extended, while Iran has continued its dangerous and hostile actions. Reports indicate that Iran has intensified its financial support for its proxy terrorist groups following the nuclear agreement. The two Congress members pointed to Iran's assistance to groups like Hezbollah and Hamas. Royce and Portman asserted that it is time to acknowledge that Iran, despite its promises over the past two years, has been unable to take the necessary actions to exit the FATF's blacklist of high-risk countries. Iranian central bank officials and the FATF reached an agreement in 2016 to address the concerns of this body regarding money laundering and terrorism financing. In this context, the Iranian Parliament approved a bill on January 24 last year for Iran's accession to the United Nations Convention against Transnational Organized Crime, which faced opposition from conservatives. In this regard, Ayatollah Ali Khamenei, the Supreme Leader of the Islamic Republic, on Wednesday asked the Parliament to set aside the bill on combating terrorism financing. Opponents of Iran's accession to the terrorism financing convention argue that this would block financial assistance to Hamas and Hezbollah. Supporters of Iran's accession to this treaty claim that its opponents fear economic transparency and the prevention of banking corruption.