FATF anti-money laundering group flags Iran risks

Written by:
Subscribe to Oneindia News

PARIS, Oct 12 (Reuters) Deficiencies in Iran's system of combating money laundering and terrorist financing pose risks to the international financial system, the FATF intergovernmental anti-laundering body said on Friday.

''The Financial Action Task Force is concerned that the Islamic Republic of Iran's lack of a comprehensive 'anti-money laundering/combating the financing of terrorism' (AML/CFT) regime represents a significant vulnerability within the international financial system,'' the Paris-based body said in a statement.

The 34-member FATF called on Iran to address the shortcomings urgently and added: ''FATF members are advising their financial institutions to take the risk arising from the deficiencies in Iran's AML/CFT regime into account for enhanced due diligence.'' A German banking source said the move would have little impact in practice because most European banks had already either discontinued business with Iranian counterparts or were dealing with them only on a very restricted basis.

But he said there was unease in Germany at what was seen as a political move by the FATF.

''It is problematic if the FATF enters into a political field and asks for politically motivated actions,'' said the banker, who requested anonymity because of the sensitivity of the topic.

He said that after the FATF released guidelines on June 29 on the implementation of U.N. sanctions against North Korea and Iran, the German finance ministry wrote to the national credit association expressing its unease about the intervention.

''The FATF is an anti-money laundering organisation and not a political institution,'' the banker said. Asked if there were problems with Iran's anti-money laundering and anti-terrorist finance regime, he said: ''To the best of our knowledge, no.'' Established by the Group of Seven leading industrial nations in 1989, the FATF leads international efforts to adopt and implement measures designed to counter the use of the financial system by criminals.

Its latest move came as U.S. Deputy Treasury Secretary Robert Kimmitt urged the world on Friday to take a concerted approach towards sanctions against Iran over its refusal to abandon sensitive parts of its nuclear programme.

The United States and its allies see the programme as cover for making an atomic bomb, which Iran strenuously denies.


Please Wait while comments are loading...