KURDPA - Belgium\'s Society for Worldwide International Financial Telecommunication, or Swift, is preparing to ban sanctioned Iranian banks and companies from using its financial communications and clearing system, the organization said Friday.
The move will drastically curtail Tehran\'s ability to conduct global trade, as virtually all of Iran\'s largest state and trade banks are on U.S. and European Union blacklists for allegedly supporting Iran\'s nuclear program and for supporting Middle East-based militant groups.
U.S. lawmakers have alleged that sanctioned Iranian banks have been using Swift\'s services to evade these sanctions. And both chambers of the U.S. Congress have drafted legislation that could lead to penalties against Swift\'s board of directors and owners if the body doesn\'t cut off the proscribed Iranian entities from the Swift system.
\"Swift is ready to implement sanctions against Iranian financial institutions,\" the organization said in a statement. \"A clear multilateral legal framework in relation to international financial sanctions against Iran is emerging.\"
The Obama administration, France and other European countries have been pressing the EU to formally call on Swift to cut off the sanctioned Iranian banks and companies. EU financial regulators are expected to make such a ruling either later this month or in early March, according to European officials.
Swift said on Friday that it would comply with the EU\'s ruling.
\"Swift stands ready to act and discontinue its services to sanctioned Iranian financial institutions as soon as it has clarity on EU legislation currently being drafted,\" the organization said.
Many of Iran\'s largest financial institutions, which are currently facing U.S. and EU sanctions, have continued to use Swift\'s services in recent months, according to its public records. Among them are Banks Sepah, Saderat and Mellat.
A spokesperson for Swift wouldn\'t comment on whether its actions would include cutting off Iran\'s central bank from using the organization\'s services. Such a move is seen as almost completely freezing Iran out from the global financial system. Virtually all of the world\'s largest banks use Swift to conduct financial wire transfers.
Swift\'s lawyers and directors have met with the Obama administration and members of Congress in recent weeks to discuss the new legislation being drafted, U.S. officials said. Swift has also consulted with EU regulators, the organization said.
\"This decision follows extensive consultation with our board and with relevant regulatory authorities,\" Swift said. \"The decision also reflects the extraordinary and highly exceptional circumstances of significant multilateral international support for the intensification of sanctions against Iran.\"
Source - Wall Street Journal