FROM A
DIFFERENT ANGLE by Kenneth Rijock
Financial Crime Consultant, for World-Check
Helpful hints on identifying UN Iranian sanctions problems
24 February 2007

Since the deadline has now passed for compliance with no response from Iran, rumours abound that the UN will add more Persian companies and individuals to its sanctions list. MLROs and compliance officers at EU international banks whose clients are presently doing business with Iranian entities might want to check their ability to implement additional sanctions in a timely manner, particularly where the clients are in the midst of Letter of Credit transactions or international funds transfers, pursuant to ongoing contractual relationships, with companies in industries likely to be candidates for blacklisting. You may also want to ensure that you are not negligently dealing with already sanctioned entities on an indirect basis. And let's not forget Iranian banks you work with.

Since UN sanctions are certain to be imposed sooner or later , I suggest some prudent enquiries may be in order:

  • Examine the names of all Iranian firms your customers regularly deal with to ascertain those you find which are linked to the defence and high-technology industries, and thus prime candidates for sanctions should they be assisting in the WMD or missile programmes.  Have you run the names of your clients' Iranian customers through World-Check ? 
  • Check to see whether your bank has a correspondent relationship with any banks located outside of Iran that are wholly owned by Iranian banks, especially those in the UK. Is there any nesting occurring involving Iranian entities already on the sanctions list operating through those wholly-owned banks and into yours ? Have you even considered the possibility that this is going on ? what about Iranian banks operating in Dubai, are you doing business with them ?
  • What about those few major Iranian banks not on sanctions lists; are you dealing with them, and if so, do you have an action plan prepared, in the event they are sanctioned tomorrow ?

The idea is to minimise the stress and delay when Iranian entities and individuals make the sanctions list, to seamlessly terminate sanctioned customers, or customers' customers, and to anticipate the parties involved, so that your staff will get an early indication of who may be next.

 

 

   

 

 

  

 

The facts and opinions stated in this article are those of the author and not those of World-Check. World-Check does not warrant the accuracy of any facts and opinions stated in this article, does not endorse them, and accepts no responsibility for them.

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