Stringent US Moves against Money Flows from Iraq to Iran

A currency exchange shop in central Baghdad (AP)
A currency exchange shop in central Baghdad (AP)
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Stringent US Moves against Money Flows from Iraq to Iran

A currency exchange shop in central Baghdad (AP)
A currency exchange shop in central Baghdad (AP)

The decline in the value of Iraq’s national currency and the rise in the prices of foodstuffs and imported goods can be traced back to remarkable change in the policy adopted by the US Treasury and the Federal Reserve Bank of New York.

Both bodies have had a policy shift to curb money laundering and the illegal appropriation of dollars by Iraqi commercial banks for the benefit of Iran and other countries subject to sanctions in the Middle East.

The New York Fed began enforcing tighter controls on international dollar transactions by commercial Iraqi banks in November in a move to curtail money laundering and the illegal siphoning of dollars to Iran and other heavily sanctioned Middle East countries, US and Iraqi officials said according to the Wall Street Journal.

Iraqi banks had operated under less stringent rules since shortly after the 2003 US invasion.

It is time for Iraq’s banking system to comply with global money-transfer practices, the officials added.

Since the procedures went into effect, 80% or more of Iraq’s daily dollar wire transfers, which previously totaled over $250 million some days, have been blocked because of insufficient information about the funds’ destinations or other errors, according to US and Iraqi officials and official Iraqi government data.

Under the new procedures, Iraqi banks must submit dollar transfers on a new online platform with the central bank, which are then reviewed by the Fed.

The system is aimed at curtailing use of Iraq’s banking system to smuggle dollars to Tehran, Damascus and money laundering havens across the Middle East, US officials said.

Another US official said the measures would limit “the ability of malign actors to use the Iraqi banking system.”

US officials have pressed Iraq for years to strengthen its banking controls. In 2015, the Federal Reserve and Treasury Department temporarily shut off the flow of billions of dollars to Iraq’s central bank over concerns that the currency was ending up at Iranian banks and possibly being funneled to ISIS militants, officials said at the time.



Blinken Meets China’s Wang after Chiding Beijing’s ‘Escalating Actions’ at Sea

US Secretary of State Antony Blinken speaks at the 57th ASEAN Foreign Ministers' Meeting at the National Convention Center, in Vientiane, Laos, July 27, 2024. (Reuters)
US Secretary of State Antony Blinken speaks at the 57th ASEAN Foreign Ministers' Meeting at the National Convention Center, in Vientiane, Laos, July 27, 2024. (Reuters)
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Blinken Meets China’s Wang after Chiding Beijing’s ‘Escalating Actions’ at Sea

US Secretary of State Antony Blinken speaks at the 57th ASEAN Foreign Ministers' Meeting at the National Convention Center, in Vientiane, Laos, July 27, 2024. (Reuters)
US Secretary of State Antony Blinken speaks at the 57th ASEAN Foreign Ministers' Meeting at the National Convention Center, in Vientiane, Laos, July 27, 2024. (Reuters)

US Secretary of State Antony Blinken met his Chinese counterpart Wang Yi on Saturday during a regional summit in Laos, hours after criticizing Beijing's "escalating and unlawful actions" in the South China Sea.

Blinken and Wang shook hands and exchanged greetings in front of cameras but made no comments before moving to closed-door talks in what will be their sixth meeting since June 23, when Blinken visited Beijing in a significant sign of improvement for strained relations between the world's two biggest economies.

Though Blinken had singled out China over its actions against US defense ally the Philippines in the South China Sea during a meeting with Southeast Asian counterparts earlier on Saturday, he also lauded the two countries for their diplomacy after Manila completed a resupply mission to troops in an area also claimed by Beijing.

The troop presence has for years angered China, which has clashed repeatedly with the Philippines over Manila's missions to a grounded navy ship at the Second Thomas Shoal, causing regional concern about an escalation.

The two sides this week reached an arrangement over how to conduct those missions.

"We are pleased to take note of the successful resupply today of the Second Thomas shoal, which is the product of an agreement reached between the Philippines and China," Blinken told ASEAN foreign ministers.

"We applaud that and hope and expect to see that it continues going forward."

GAZA SITUATION 'DIRE'

Blinken and Wang attended Saturday's security-focused ASEAN Regional Forum in Laos alongside top diplomats of major powers including Russia, India, Australia, Japan, the European, Britain and others, before heading to their meeting.

Blinken said earlier the United States was "working intensely every single day" to achieve a ceasefire in Gaza and find a path to more enduring peace and security.

His remarks follow those of Indonesian Foreign Minister Retno Marsudi, who said the need for sustainable peace was urgent and international law should be applied to all. The comment from the world's largest Muslim-majority nation, was a veiled reference to recent decisions by two international courts over Israeli's Gaza offensives.

"We cannot continue closing our eyes to see the dire humanitarian situation in Gaza," she said.

More than 39,000 Palestinians have been killed in the fighting in Gaza since Israel launched its incursion, according to Palestinian health authorities, who do not distinguish between fighters and non-combatants.

Israeli officials estimate that some 14,000 fighters from armed groups including Hamas and Islamic Jihad, have been killed or taken prisoner, out of a force they estimated to number more than 25,000 at the start of the war.

The war began when Hamas fighters attacked Israel on Oct. 7, killing 1,200 people and abducting some 250 others, according to Israeli tallies.

Also in Laos, Russia's Foreign Minister Sergei Lavrov said guidelines on the operation of US nuclear assets on the Korean peninsula were certain to add to regional security concerns.

Lavrov, according to South Korean news agency Yonhap, said he had not been briefed on the details of the plan, which was of concern to Russia.

"So far we can't even get an explanation of what this means, but there is no doubt that it causes additional anxiety," Russia's state-run RIA new agency quoted him as saying.

'THIS IS NOT SUSTAINABLE'

Ahead of Saturday's two summits, Australian Foreign Minister Penny Wong urged Myanmar's military rulers to take a different path and end an intensifying civil war, pressing the generals to abide by their commitment to follow ASEAN's five-point consensus peace plan.

The conflict pits Myanmar's well-equipped military against a loose alliance of ethnic minority rebel groups and an armed resistance movement that has been gaining ground and testing the generals' ability to govern.

The junta has largely ignored the ASEAN-promoted peace effort, and the 10-member bloc has hit a wall as all sides refuse to enter into dialogue.

"We see the instability, the insecurity, the deaths, the pain that is being caused by the conflict," Wong told reporters.

"My message from Australia to the regime is, this is not sustainable for you or for your people."

An estimated 2.6 million people have been displaced by fighting. The junta has been condemned for excessive force in its air strikes on civilian areas and accused of atrocities, which it has dismissed as Western disinformation.

ASEAN issued a communique on Saturday, two days after its top diplomats met, stressing it was united behind its peace plan for Myanmar, saying it was confident in its special envoy's resolve to achieve "an inclusive and durable peaceful resolution" to the conflict.

It condemned violence against civilians and urged all sides in Myanmar to cease hostilities.

ASEAN welcomed unspecified practical measures to reduce tension in the South China Sea and prevent accidents and miscalculations, while urging all stakeholders to halt actions that could complicate and escalate disputes.

The ministers described North Korea's missile tests as worrisome developments and urged peaceful resolutions to the conflicts in Ukraine, as well as Gaza, expressing concern over the dire humanitarian situation and "alarming casualties" there.