US embargo against Iran bank not a violation - IMF

WASHINGTON, Mar 12 (Reuters) The United States' sanctions against Iran's Bank Saderat do not contravene foreign exchange rules, an International Monetary Fund spokesman said on Monday after Tehran asked the IMF to explore whether the U.S. actions were legal.

''We have reviewed the Iranian authorities' request,'' IMF spokesman William Murray told Reuters. ''We advised the authorities that the new U.S. measures do not give rise to an exchange restriction,'' he added.

The IMF's comments follow a request late last year by Iran to determine whether the U.S. embargo against Saderat, which Washington accuses of financing terrorism, violated IMF rules on foreign exchange restrictions.

The matter was raised again last month during a meeting of the IMF's board of member countries to discuss Iran's economy.

Iran first raised the issue in November when an IMF staff mission was holding consultations in Tehran. The authorities had expressed concern that since the United States cut off Saderat, the bank has been unable to issue letters of credit in dollars, which was affecting deposits.

Iran also complained that several correspondent banks in Europe and Asia with activities in the United States has cut off Saderat from operating in other currencies.

Washington has since intensified its campaign to isolate Tehran for its nuclear program by extending sanctions to Iran's oldest bank -- state-owned Bank Sepah -- which Washington accuses of transferring Iranian missile payments to North Korea.

Iran has dismissed the U.S. embargo against its banks as ''harassment.'' REUTERS PDM KN2158