Iran's Expediency Council Approves Anti-Money Laundering Law

EghtesadOnline: The Expediency Council, a powerful body that resolves disputes between parliament and a watchdog body, the Guardian Council, on Saturday approved the amendment to Combating Money Laundering Law on the first meeting of the council chaired by its new head Ayatollah Sadeq Amoli Larijani.

News ID: ۷۴۶۴۱۳

05 January 2019

The bill was passed by the Majlis last September as part of the legislative push by the administration of President Hassan Rouhani to update the country's laws in line with international norms and especially to meet an action plan set forth by the inter-governmental Financial Action Task Force.

However the Guardian Council found the bill in contravention of the constitution but as lawmakers insisted on their earlier version of the bill, the issue was referred to the Expediency Council which finally decides on what would be "expedient for the system."

The approval would be a victory for the government and moderate forces that favor an embracement of international conventions which they say is necessary for Iran's financial ties with the outside world as the US tries to isolate Iran, according to Financial Tribune.

Two experts which were present at the Expediency Council's Saturday meeting confirmed to the Financial Tribune of the approval but said that due to last- minute changes, they could not opine on the whole legislation until its text is officially released by council.

According to one expert, as per the procedure, the law will now go to the Majlis and the legislative body will in turn notify it to the government.

Majid Ansari, a member of the Expediency Council told the local news website Jamaran that only "minor changes" had been made to the law at the council before being approved.

One expert informed the tribune that although "every word of the government's bill matter", the law was not altered much. "What was approved by the council had the same main components as that version passed by the Majlis."

According to experts with knowledge of the contents of the approved law, the measure lacks an article that would legally bind the Central Bank of Iran to monitor the operations of banks, specifically in the area of money laundering.

"Although it is taken for granted that the CBI should supervise banks in all matters, the legal text officiating that task does not exist in this law," one expert said.

The government had unsuccessfully sought to insert that section before the bill was approved by lawmakers but will reportedly attempt to do so as an amendment soon, given that Iran's deadline to complete FATF's recommendations is approaching its end.

FATF announced in October that Iran had until February to complete reforms or face consequences.

The Paris-based body said after a meeting of its members that it was disappointed that Tehran had failed to complete its action plan despite pledges to make the upgrade. It had previously set a deadline of October to complete all 10 reforms.

The Tehran government has sent four pieces of legislation to the parliament, which includes amending the country's AML/CFT law in accordance with FATF standards and joining the United Nations Convention Against Transnational Organized Crime (Palermo) and the International Convention for the Suppression of the Financing of Terrorism.

Informed sources told the Tribune that the Expediency council will deal with Palermo bill (also contested by Guardian Council) in two weeks. The fate of the most contentious of the bills–the one that will join Iran to the UN anti-terror finance convention–will almost certainly fall to the Expediency Council as well.

Amoli Larijani – who also doubles as the chief of Iran’s judiciary- was named as the new head of the council last week.

Larijani, 57, was appointed by Leader Ayatollah Seyyed Ali Khamenei, who also made him a member of the Guardian Council, which vets laws and elections for compliance with Iran’s constitution and Sharia.