New Decisions Made to Resolve Issues for Depositors of Financial Institutions

A member of parliament announced that 'three decisions' have been made to resolve the issues faced by depositors of the financial institutions 'Fereshtegan' and 'Caspians' by a committee formed at the suggestion of the head of the judiciary. Mohammad Reza Tabesh, a supervising member of parliament in the Money and Credit Council, stated on Tuesday, November 8, to the Tasnim news agency that this committee was formed with the aim of 'solving the problems of depositors.' The members of this committee include 'the liquidation committee of the Fereshtegan financial institution, the board of directors of Caspian, a representative from parliament, a representative from the Attorney General's office, the head of the financial prosecution, and the deputy of the Central Bank's supervision.' According to this member of parliament, 'this committee is supposed to determine the status of debts to depositors and the assets of the Fereshtegan financial institution, which will be transferred to the Caspian financial institution for the payment of depositors.' This supervising member of parliament in the Money and Credit Council announced that in its first meeting, the committee decided that 'assets that have been mutually agreed upon in the pricing between the Fereshtegan and Caspian financial institutions will be transferred.' He mentioned that 'some depositors are also willing to take some of the assets of the Fereshtegan and Caspian financial institutions in exchange for higher prices than the set rate, and in a third decision, it was decided that a list of these assets will also be provided for resolution.' Mohammad Reza Tabesh also referred to a decision made by the heads of the three branches of government that allows for payments of up to 200 million tomans to depositors with 'religious permits.' This decision was made following the referral of some issues related to financial institutions by the Supreme Leader to the heads of the three branches. This member of parliament stated that the part of the 'financial resources of the financial institutions' that had been 'seized' due to complaints from some depositors would be released by the judiciary after the list of accounts of the financial institutions is determined to facilitate payments. Gholam Hossein Mohseni Ejei, the spokesperson of the judiciary, also stated on Sunday, November 7, that the work of this branch in the case of financial institutions is 'identifying the criminals' and 'there is no money to give to the people.' According to ISNA news agency, he added that if the assets of the Fereshtegan and Caspian institutions are 'identified, there is no problem, but if there is a shortfall, the judiciary cannot cover this shortfall.' The spokesperson of the judiciary stated that according to the Central Bank's report, 1,500 billion tomans have been repaid to depositors so far, and there is a 'shortfall' in the Fereshtegan financial institution based on the review of all its movable and immovable assets. The unresolved issues of the depositors of the Caspian institution and the joining of the victims of other institutions such as 'Arman,' 'Fereshtegan,' 'Samen,' and 'Padideh' to their protests have reached a point where the Supreme Leader and the heads of the branches have also become involved in this matter. A number of depositors of credit institutions in Iran, including 'Caspian,' have long protested the blocking of their deposits and are demanding the retrieval of their money. Monetary, banking, and regulatory officials in Iran have been announcing for months the beginning of efforts and some decisions to resolve the problems of these depositors, but according to reports, these problems remain unresolved, and protesters continue their gatherings in front of the parliament and other government institutions. Credit cooperatives, interest-free loan funds, and unauthorized financial institutions are a problem that arose due to the excessive issuance of licenses during Mahmoud Ahmadinejad's presidency. The Research Center of the Parliament also reported in its June report last year that from 1972 to 2011, the volume of banking activities by non-bank financial institutions has nearly tripled. According to this report, a large part of Iran's monetary market is 'outside the regulatory and supervisory framework of the monetary authority,' and out of 7,333 financial institutions in the country, 6,033 do not have licenses. The Research Center of the Parliament also warned that six 'unauthorized' credit institutions have about 133 trillion tomans, which is about six percent of the total assets of the authorized and unauthorized banking system. This center attributed the continued activity of 'unauthorized' financial institutions to the 'dependency' of some of them on 'various and unaccountable entities' to the Central Bank. Central Bank officials have also stated that 2017 will be the year of ending the activities of unauthorized financial institutions and credit cooperatives.