Iran has until June to fix its anti-money laundering and terrorism financing rules or face increased international scrutiny of its banks, the Financial Action Task Force (FATF) said on Friday.
Last October the Paris-based FATF gave Iran until February to complete reforms that would bring it into line with global norms, or face consequences. But at a meeting this week the watchdog concluded that Iran had not done so.
Foreign businesses say Iran’s compliance with FATF rules is key if it wants to attract investors, especially after the United States re-imposed sanctions on Iran last year.
Marshall Billingslea, US assistant Treasury Secretary for terrorist financing, who chaired the FATF meeting, said Iran had until June before countermeasures would automatically kick in.
“That is a significant indication from the FATF that time has expired, the action plan is overdue and we expect it to be implemented without delay,” Billingslea told journalists.
FATF members worldwide would be required to step up supervision of Iranian bank branches on their territory, including on-site inspections, Billinglsea said.
In the absence of compliance, the FATF called on its members to advise their banks to scrutinize all business with Iran, including obtaining information on reasons for intended transactions, stepping up controls on transactions and identifying patterns of transaction for further scrutiny.
Iran’s central bank welcomed the deadline extension granted by the FATF and called in a statement for the “remaining bills to be approved as soon as possible”, the Iranian state news agency IRNA reported.
The government of President Hassan Rouhani and his supporters in parliament have been trying to secure the adoption of four bills to bring Iran into compliance with FATF regulations.
Only two of the bills have been approved.
