Governance

HM Treasury warns on finance deals with Iran

 Print E-mail
Governance
Written by Gary Howes   
Wednesday, 11 November 2009

Call comes amid concerns over money laundering in aid of terrorism.

 

HM Treasury has warned the UK financial sector to cease all business relationships and transactions with Iranian institutions Bank Mellat and Islamic Republic of Iran Shipping Lines (IRISL).

The warning comes as Financial Action Task Force (FATF) reports back to HM Treasury on the risks posed by unsatisfactory money laundering controls in a number of jurisdictions.

A core concern of the FATF is to prevent money laundering that could be benefiting terrorists.

The warning issued to businesses on dealing with Bank Mellat and IRISL is part of a wider move against Iran.

The FATF is concerned about Iran’s lack of engagement with the FATF and its failure to meaningfully address the ongoing and substantial deficiencies in its AML/CFT regime.

The FATF has called on its members to apply effective countermeasures to protect their financial sectors from risks emanating from Iran, and to protect against the use of correspondent banking relationships to bypass or evade counter-measures and risk mitigation practices.

The FATF has further warned that it will call upon its members and other jurisdictions to strengthen counter-measures at it’s next meeting in February 2010 if Iran fails to take concrete steps to improve the deficiencies in its AML/CFT regime.

All UK businesses regulated under the Money Laundering Regulations 2007 whether financial institutions or other regulated persons should treat transactions associated with Iran as situations that by their nature can present a higher risk of money laundering or terrorist financing, and which therefore require increased scrutiny, enhanced due diligence, and ongoing monitoring, particularly where correspondent relationships are involved, which have been highlighted as a particular risk.

All other persons authorised by the Financial Services Authority should also take this advice into account in respect of their systems and controls to counter financial crime, and take appropriate actions to minimise the associated risks. 

 
 
Share this article:
Digg It! Digg it!   Post to del.icio.us del.icio.us   Seed in Newsvine Newsvine   Post to reddit Reddit   Facebook  Stumble It! Stumble It!  

Subscribe to our weekly newsletter for top jobs, news, blogs and more

Get the latest senior finance job roles, news, blogs, features, industry moves and opinion delivered directly to your inbox every week. Sign up here .