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Treasury Department Imposes Sanctions on Iranian Banks and Entities
The United States Treasury Department’s Office of Foreign Assets Control (OFAC) has imposed sanctions on several Iranian banks and entities, citing their links to terrorist activity and Iran’s ballistic missile program.
Purpose of the Sanctions
According to OFAC, the sanctions are aimed at targeting entities that have contributed to Iran’s proliferation activities and pose a risk to national security. The department has also issued a notice of proposed rulemaking to impose a special measure against Iran based on its finding that it is a jurisdiction of “primary money laundering concern” under Section 311 of the USA PATRIOT Act.
Financial Institutions’ Responsibilities
Financial institutions are advised to familiarize themselves with the financial provisions and prohibitions contained in United Nations Security Council Resolutions (UNSCRs) against Iran and North Korea. Existing U.S. sanctions, including those under the North Korea Sanctions Regulations and Executive Orders, create a legal framework that limits direct exposure to transactions contributing to proliferation activities.
Increased Due Diligence Required for Myanmar
The Financial Crimes Enforcement Network (FinCEN) has advised U.S. financial institutions to apply enhanced due diligence when maintaining correspondent accounts for foreign banks operating under a banking license issued by Myanmar. This is in accordance with the FATF’s decision and Section 312 of the USA PATRIOT Act.
Jurisdictions with Strategic AML/CFT Deficiencies
FinCEN has identified several jurisdictions that have strategic anti-money laundering/combating the financing of terrorism (AML/CFT) deficiencies, including:
- Afghanistan
- Algeria
- Angola
- Bosnia and Herzegovina
- Guyana
- Iraq
- Lao PDR
- Panama
- Papua New Guinea
- Syria
- Uganda
- Yemen
Financial institutions are reminded to comply with general due diligence obligations and ensure that their due diligence programs include appropriate policies, procedures, and controls to detect and report known or suspected money laundering activity.
Reporting Suspicious Transactions
Financial institutions are required to file a Suspicious Activity Report if they know, suspect, or have reason to suspect that a transaction involves funds derived from illegal activity or that a customer has otherwise engaged in activities indicative of money laundering, terrorist financing, or other violation of federal law or regulation. The department also provides a toll-free hotline for financial institutions to report suspicious transactions related to terrorist activity.
FinCEN’s Mission
The Financial Crimes Enforcement Network (FinCEN) is committed to safeguarding the financial system from illicit use and combating money laundering and promoting national security through the collection, analysis, and dissemination of financial intelligence and strategic use of financial authorities.