A host of 75 Iranian legislators signed on Sunday a letter to Chairman of the country’s Expediency Council Ayatollah Sadeq Amoli Larijani, warning that the FATF action plan taken up by the country’s government 3 years ago which led to the implementation of 41 requirements of the body has deadlocked national economy.
“The government immediately put all the requirements, except four of them which needed the parliament’s approval, into full practice, because it believed that meeting the FATF demands would ease Iran’s banking relations with other countries,” the letter read.
The signatories asserted that the government’s firm stance to fully observe the requirements of the FATF had led to the depreciation the national currency, Rial, last year.
The lawmakers held Iranian First Vice-President Eshaq Jahangiri and some other members of the cabinet responsible for worsening economic situation in the country, adding that the mentioned officials should be held accountable for implementing 39 FATF requirements and insisting on approval vote for the 2 remaining articles of the demands.
They concluded the letter asking Ayatollah Amoli Larijani to require the government to offer a report on the results of the implementation of the FATF standards in the past three years.
“Before making any decision on accession to the convention against the funding of terrorism (CFT) and the UN Convention on Transnational Crime (Palermo bill), the government must be required to submit a comprehensive report to your excellency on the achievements of three years of compliance with the 41-fold FATF requirements,” they said.
Early in March, Iran’s Expediency Council concluded its last session of the current (Iranian calendar) year without making a final decision on Tehran’s accession to the CFT and the Palermo bill, postponing the final say until May.
An EC Member Seyed Mostafa Mirsalim said that upon the request of Government and Parliament representatives to decide the fate of Palermo and CFT, Expediency Council will be given more time to review the bills, leaving the fate of the bill unknown till the next Iranian year (starting on March 21).
Another member of the council, Ayatollah Mohsen Mojtahed Shabestari said that there were two reasons behind the stagnation in reaching the final say.
“Considering that the Palermo bill and the CFT are related to each other, we have to wait and take both of the issues into a joint commission for making a more thorough decision,” he added.
Mojtahed Shabestari highlighted that a second reason is an inclination to wait and see how Europeans are abiding by their commitments to Iran.
“If Europeans fail to deliver on their promises, then the EC will make a relevant decision, and we have to wait till then,” he underlined.
Iran has been required to fulfill dozens of FATF recommendations to enhance its status from a blacklist of non-cooperative countries, while the country is under US sanctions. The country’s status in FATF has no impact on toughening or easing the US sanctions.
FATF has required Iran to implement a number of moves that include endorsement of several conventions.
Palermo bill is one of the four government bills seeking to bring Iran’s anti-money laundering and countering terrorism financing standards into line with those defined by the FATF.
The parliament has approved all the measures but except for the bill that updates Iran’s domestic law on countering financing of terrorism. All the rest have been rejected by the Guardian Council – a watchdog that ensures laws are in line with the Constitution and Sharia.
The bills on Iran’s accession to the Palermo Convention and the CFT were rejected by the Guardian Council in early November due to some flaws that violated the country’s Constitution. The bills were then amended by the Iranian Parliament, waiting for the next steps in the Guardian Council.
To fulfill FATF requirements, President Hassan Rouhani’s administration has proposed four bills to the parliament for approval, two of which are still undecided, including the Palermo Convention. They have been referred to the Expediency Council for final approval.
Yet, Iran has recently approved a national anti-money laundering (AML), which was a domestically-developed bill.
In its February meeting, the FATF decided to extend the deadline for Iran until June to complete reforms under the specified action plan that includes a list of 9 major moves, including the opening of its financial transactions data bank to the FATF that is headed by the US Department of the Treasury’s Assistant Secretary heading the Office of Terrorist Financing and Financial Crimes Marshall Billingslea.
The Political-Defense-Security and Legal-Judicial Commissions of the Expediency Council declared in January that endorsement of the Palermo bill would run against the country’s interests.
In relevant remarks on January 26, Secretary of Iran’s Expediency Council Mohsen Rezayee announced that the EC’s specialized commissions have rejected the country’s endorsement of the Palermo bill, adding that the final decision would be made in the Council’s next meeting.
Speaking to reporters after an Expediency Council meeting on Palermo convention here in Tehran, Rezayee said that the EC’s specialized commissions have concluded that harms and losses of Iran’s endorsement of the convention would overpass its merits.
“It is a reality but the EC will have the final decision in this regard,” he added.
Asked if Iran is entitled to set preconditions to join Palermo and the blur conditions surrounding this issue, Rezayee said, “Of course, there are much more ambiguities too and it was decided that the pros and cons study them in the next meeting.”