Central Bank Chief's Directive to Provide Services to Sanctioned Entities

Following reports about the lack of currency services provided by Iranian banks to entities sanctioned by the European Union and the United Nations, the Governor of the Central Bank requested banks to provide services to customers "solely based on domestic laws." Meanwhile, the spokesperson for the Iranian Foreign Ministry dismissed "some objections and concerns" regarding the implementation of the Financial Action Task Force (FATF) regulations as "unfounded" and stated that they have "no concerns" about implementing these regulations. According to Tasnim News Agency, Valiollah Seif, the Central Bank Governor, emphasized in a letter published on Tuesday, September 6, that "any action" to restrict or cut services to individuals and entities based on Western sanctions "has no basis in the JCPOA and other international commitments of the Islamic Republic of Iran." Seif stated that according to the Vienna nuclear agreement, foreign financial institutions cooperating with Iranian banks "will not be subject to sanctions on the pretext that Iranian banks maintain their relations with individuals still on the sanctions list." He stressed that all Iranian banks and financial institutions can cooperate with all individuals on the Western sanctions list and that "there are no restrictions arising from sanctions within the country." On Saturday, September 4, Kayhan newspaper reported that Iranian banks, including Mellat and Sepah, announced they could not provide currency services to entities sanctioned by the EU and the UN, including the Islamic Revolutionary Guard Corps (IRGC). According to the newspaper, Bank Mellat responded to a request from the Khatam al-Anbia Headquarters, affiliated with the IRGC, stating that "processing all currency (international) services for those customers whose names are on the EU sanctions list or the joint EU and UN sanctions list is not possible." In contrast, some Telegram channels have stated that due to the sanctions on these entities, if Iranian banks issue currency declarations for them, foreign banks will not accept these declarations, indicating that the letter from these banks outlines technical reasons and the existing reality. In recent days, several members of parliament have protested the implementation of the FATF regulations in Iran. In recent months, media affiliated with the IRGC, including Fars and Tasnim news agencies, have published dozens of reports and interviews protesting the implementation of these regulations. On June 24, 2016, the FATF announced that the restrictions on Iran's banking system would be suspended for 12 months. This announcement and the 12-month opportunity for Iran followed an agreement reached by Iranian Central Bank officials with a special group called the "Action Plan" regarding anti-money laundering and counter-terrorism measures. Iran committed to implementing the action plan to demonstrate its commitments. Meanwhile, the spokesperson for the Iranian Foreign Ministry responded to the protests, stating: "Some information and interpretations are incorrect. Of course, some concerns are well-intentioned, and we understand that." According to IRNA, Bahram Qasemi emphasized: "To those who raise issues in this regard and confuse public opinion with misinformation, we clearly state that we have no concerns about the FATF, and these issues do not have the significance they are given." He stated that they consider Hezbollah to be "the pride of Lebanon and the Islamic world" and added that "these regulations are against recognized terrorist groups such as ISIS, Al-Qaeda, and Al-Nusra." The Iranian Foreign Ministry spokesperson also emphasized that this agreement is "not related" to the Vienna nuclear agreement and is "a separate matter." Some members of parliament have claimed in recent days that if the FATF regulations are implemented, Iran will recognize groups such as Hezbollah, Hamas, and Islamic groups as "terrorist groups" from 2018 onwards. Abbas Araghchi, the Deputy Foreign Minister of Iran, emphasized on Tuesday, July 10, that the Islamic Republic will "sacrifice nothing" for Hezbollah. According to Araghchi, Iran is expected to reach an understanding with the FATF regarding the concept of terrorist groups, and these negotiations will continue for another 18 months.