FinCEN ADVISORY ON THE IRANIAN REGIME’S ILLICIT AND MALIGN ACTIVITIES AND ATTEMPTS TO EXPLOIT THE FINANCIAL SYSTEM

On 11th October, FinCEN issued a new Advisory that it says is to help US financial institutions (particularly banks; money services businesses (MSB), such as virtual currency administrators and exchangers; and dealers in precious metals, stones, and jewels) better detect potentially illicit transactions related to Iran.  Further, it says it will also help foreign financial better understand the obligations of their US correspondents, avoid exposure to US sanctions, and address the AML/CFT risks that Iranian activity poses to the international financial system.  It refers to alleged involvement of the Central Bank and exchange houses to facilitate malign activity and the use of its procurement networks, including –

  • printing equipment and materials used for counterfeiting currency,
  • dual-use equipment procurement for ballistic missile proliferation,
  • Iranian airlines and their agents and affiliates have used deceptive schemes to procure aviation-related materials using front companies
  • Iran-related shipping companies’ access to the financial system
  • Iran has previously used precious metals, such as gold, to evade .. sanctions and facilitate the sale of Iranian oil and other goods abroad
  • while the use of virtual currency in Iran is comparatively small at present, virtual currency is an emerging payment system that may provide potential avenues for individuals and entities to evade sanctions.

It refers to FATF findings relating the country’s AML/CFT regimes (though currently Iran is seeking FATF membership and to amend its legislation accordingly); and to Red Flags related to deceptive Iranian activity and the above elements; and to the US sanctions regime.

https://www.fincen.gov/sites/default/files/advisory/2018-10-11/Iran%20Advisory%20FINAL%20508.pdf

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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