The Iraqi Central Bank published the names of the eight banks banned from dealing in dollars (Al Jazeera)
Iraq decided to prevent 8 local commercial banks from dealing in the dollar, as part of the measures taken to limit fraud, money laundering, and other illicit uses of this American currency, days after the visit of a senior official in the US Treasury Department to the capital, Baghdad.
According to the decision, banks will be prohibited from participating in the daily dollar auction organized by the Central Bank of Iraq, and the auction is the main source of hard currency in the country that depends on imports.
Focal point
Iraq has become a focal point in the American campaign aimed at reducing dollar smuggling to Iran.
This country, a rare ally of both the United States and Iran, has reserves of more than $100 billion in the United States, and Iraq relies heavily on the good will of Washington to ensure that its access to oil revenues and financial resources is not obstructed.
The Iraqi Central Bank issued a document, verified by a bank official, that included the names of the banned banks, namely the Assyria International Investment Bank, the Iraqi Investment Bank, the Iraqi Union Bank, the Kurdistan International Islamic Bank for Investment and Development, Al-Huda Bank, the South Islamic Bank for Investment and Finance, the Arab Islamic Bank, and the Islamic Bank of Iraq. Commercial Hammurabi.
A US Treasury spokesman praised the steps that the Central Bank of Iraq is constantly taking to protect the Iraqi financial system from abuse.
Last July, Iraq decided to prevent 14 banks from conducting transactions in dollars, as part of a broader campaign aimed at preventing the smuggling of dollars to Iran at that time through the Iraqi banking system. Iraqi and American officials said that the decision came after a request from Washington.
The Iraqi Central Bank says that banks banned from dealing in dollars are allowed to continue operating and conducting transactions in other currencies.
Brian Nelson, US Treasury Undersecretary for Counterterrorism and Financial Intelligence, met - last week - with senior Iraqi officials in Baghdad, and discussed with them ways to protect the Iraqi and international financial systems from criminal, corrupt and terrorist entities, as he described it.
The Treasury Department announced measures against Al-Huda Bank during the visit, saying it had participated in transferring billions of dollars to Iranian-backed groups.
Greater effort
Reuters quoted a senior official in the Treasury Department as saying that Washington expects Iraq to make a greater effort to help confront the Iranian-backed armed groups that are carrying out operations from Iraq after the killing of 3 American soldiers last week. Washington has held extremist Iraqi factions responsible for this attack.
The current Iraqi government came to power with the support of powerful parties backed by Tehran and armed factions with interests in Iraq's largely informal economy, including the financial sector, which has long been viewed as a center for money laundering.
Western officials praised the cooperation with Iraqi Prime Minister Muhammad Shiaa Al-Sudani in implementing economic and financial reforms aimed at limiting the ability of Iran and its allies to access the dollar, and bringing the Iraqi economy in line with international standards.
Source: Reuters