Iran's CB Dismisses Bahrain Court Ruling

EghtesadOnline: The Central Bank of Iran condemned a Bahraini court verdict convicting Iranian banks for alleged money laundering saying that it "lacks legal basis".

News ID: ۷۵۱۴۲۸

08 November 2020

In a press release posted on the CBI website, Morteza Etebari, head of the bank’s legal affairs department, said the Bahraini move was "politically motivated" and "lacks judicial validity".

The state-owned Bahrain News Agency (BNA) reported Thursday that the high criminal court in the tiny pro-US Arab kingdom sentenced three Iran-owned Future Bank officials charged for financial crimes and money laundering to five years in jail and fines of one million dinar each.

The court also fined the CBI and other Iran-owned banks, including Future Bank, implicated in the schemes one million dinar each and ordered confiscation of funds that the banks allegedly wanted to transfer illegally.

Advocate general, Nayef Yousef Mahmoud, head of the Financial Crimes and Money Laundering Prosecution, said the total fines in seven cases reviewed by the court reached 49 million dirhams while the confiscated funds amounted to $173 million.

Known also as Al-Mustaqbal Bank, the Manama-based bank was set up in 2004 with the permission of the Bahraini government as a joint venture by Bank Saderat Iran and Bank Melli Iran as well as the Arab state’s Al-Ahli Bank, operated under the supervision of the its central bank, according to Etebari.

The official said the ruling has not been officially sent to the CBI or other Iranian banks mentioned in the case and that they had not been summoned by the Bahraini court to defend themselves against the allegations.

"As the court has violated the defendants' rights to defse, its verdicts are considered politically motivated, which lack judicial validity," he said.

"If and when the verdict is officially announced it will be responded to legally in due time.”

Etebari accused the Manama government of making false allegations against Future Bank and its managers, reiterating that due process was not observed in issuing the verdicts.

Alleged Illegal Transfer

According to BNA, Bahrain's public prosecution office earlier claimed that its investigations had revealed Iran's central bank planned to launder billions of dollars through Future Bank to pass suspicious financial transactions in favor of Iranian entities, mainly the CBI, in violation of laws and regulations.

The news agency claimed that Future Bank received requests for suspicious financial transfers in favor of the CBI and other Iranian banks through the “SWIFT” system to conceal the identity of the Iranian banks.

The general advocate said investigations are still underway regarding remaining incidents in which the central bank and other Iranian banks used Future Bank to carry out international transactions in violation of the Law on Prohibiting and Combating Money Laundering and Combating Terrorism Financing.

To date, the Manama court has imposed a total of 330 million dinars in fines against those “found guilty” in cases related to Future Bank, confiscated transfer amounts worth $323 million and issued custodial penalties against them.