Squire Patton Boggs on 26th April reported on an ongoing court case involving Future Bank, formed by Iran’s Bank Melli and Bank Sadarat with Bahrain’s Ahli United Bank in 2004.  However, by 2015, Bahraini regulators had placed Future Bank into administration and, by 2016, had closed the bank, on suspicions of money laundering.  This prompted Banks Melli and Saderat to bring an action in The Hague, claiming breach of the 2002 Bahrain-Iran Bilateral Investment Treaty for the Promotion and Protection of Investments.  They also sought the return of assets they allege were misappropriated by Bahrain. Banks Melli and Saderat also contend that Bahrain’s closure of Future Bank was attributable to political pressure from Saudi Arabia.  Both Iranian banks had been designated under US sanctions from 2005.  Evidence submitted in the case claims the joint venture afforded Iran “secret access” to the international monetary system in defiance of US and other international sanctions intended to isolate Iran and facilitating $7 billion of trade.  It is claimed that, as a result, Future Bank may have facilitated business for purposes of organised crime, arms proliferation and terrorism, with an audit apparently identifying “hundreds of bank accounts tied to individuals convicted of crimes including money laundering and terrorism financing, as well as phantom loans provided to companies that operate as fronts for Iran’s Islamic Revolutionary Guard Corps.

Author: raytodd2017

Chartered Legal Executive and former senior manager with Isle of Man Customs and Excise, where I was (amongst other things) Sanctions Officer (for UN/EU sanctions), Export Licensing Officer and Manager of the Legal-Library & Collectorate Support Section

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