Embassy to Help Remove Banking Hurdles in China

EghtesadOnline: After reports emerged that the banking woes of Iranian citizens in China have resurfaced and they are increasingly finding their accounts closed, the Iranian Embassy in Beijing announced that it is determined to resolve the issue.

News ID: ۷۸۰۱۳۶

29 October 2017

"Solving the banking problems of Iranian citizens, which have prevailed from the time of unjust nuclear sanctions, is one of the priorities of the Iranian Embassy in Beijing. We will emphasize and continuously follow up on resolving them in our negotiations with Chinese officials," the embassy said in a statement obtained by IRNA.

The issue first attracted attention in the media when several reports claimed that three lenders, namely Agriculture Bank of China, Industrial and Commercial Bank of China and China Merchants Bank, are closing the bank accounts of Iranian nationals.

However, an official with the Iran-China Chamber of Commerce denied en-masse closure of accounts and told Financial Tribune that the closures are mainly due to the intensification of regulations whose implementation is expected by the global standard-setting Financial Action Task Force dealing with combating money laundering, Financial Tribune reported.

“Considering the FATF recommendations and the fact that Iran still remains on the list of high-risk countries, it is only natural that Chinese lenders would close the accounts of people without official business accounts and of those who transfer massive amounts of money in their accounts without paying  taxes,” the source had added on condition of anonymity.

This suggested that the closed accounts belonged to private citizens who are on non-business visits to China, but engage in unlicensed business activities.

Shortly after, then-economy minister, Ali Tayyebnia, and Central Bank of Iran Governor Valiollah Seif also denied the closure of bank accounts, announcing that a central bank delegation will visit the East Asian nation to pursue the issue.

As the embassy outlines in its statement, the issue of account closures and refusal to open new accounts for Iranian citizens by ABC and ICBC seems to have persisted.

The issue was specifically discussed when an Iranian delegation, consisting of Seif among many others, travelled to China in mid-September to sign a $10 billion finance deal, but also met with representatives of the China Banking Regulatory Commission, the country’s independent banking regulator based in Beijing, according to the embassy.

Maintaining Dialogue

As a result of the intensification of aforementioned banking problems in recent days and in continuation of the follow-up for resolving the issue, Iran’s ambassador to China met with the officials of Chinese Foreign Ministry on Sept. 26, reads the embassy’s statement.

In addition to outlining banking troubles plaguing Iranian citizens – especially students–in China, Ali Asghar Khaji also conveyed the formal displeasure of Iran at the status quo and called for the resolution of banking issues.

Chinese officials also reportedly reassured the ambassador that the account closures are not limited to Iranian nationals and have resulted from ramped up oversight regulations by Chinese banks to better adhere to FATF recommendations regarding combating money laundering and boosting transparency.

According to an Iranian student in China, ABC was the only lender that still worked with Iranian students but has implemented harsher conditions as well.

“In a text message to students, ABC has announced that offering any services to nationals of North Korea, Syria and Iran is forbidden while dollar services to nationals of Sudan, Cuba and Crimea are disallowed,” an unnamed student told Mehr News Agency. “Residents of Turkey, Afghanistan, Pakistan, Turkmenistan and the UAE have also been put under enhanced monitoring when using Chinese banking services,” the student added.

Mehr News Agency also published a photo of the text message allegedly sent by ABC to the student, which read, “At the urgent notice of Agriculture Bank of China, please withdraw ALL the money in your ABC card TODAY (2017.10.27) in any ABC bank branches.”

“ABC shall FREEZE ALL Iranian student accounts from tomorrow (2017.10.28) ,” the purported message added.