NOVEMBER 17, 2017 - Germany's Federal Financial Supervisory Authority (BaFin) announced on Tuesday that the agency imposed a credit ban on Iran's Bank Sepah for violating the country's credit law. Bank Sepah was previously sanctioned for its role in aiding Tehran's missile program.
Sabine Reimer, a BaFin spokeswoman, told The Jerusalem Post on Friday that 'a credit ban against Bank Sepah's branch in Frankfurt was imposed because the institution violated the requirements of the rules of a business organization according to paragraph 25a of the lending law.'
She said that she could not provide additional information on account of the obligation of secrecy. The ban on credit went into effect on October 13, according to BaFin.
The UN, US and EU previously sanctioned Sepah because of its role in Iran's illicit missile procurement activities. The sanctions were lifted against Bank Sepah in 2016 as part of the Iran nuclear deal. The Iran deal, formally known as the Joint Comprehensive Plan of Action, outlined restrictions on Iran's nuclear program in exchange for sanctions relief.
'Bank Sepah is the financial linchpin of Iran's missile procurement network and has actively assisted Iran's pursuit of missiles capable of carrying weapons of mass destruction,' said Stuart Levey, the US Treasury's former Under Secretary for Terrorism and Financial Intelligence in 2007.
In addition to Frankfurt, Bank Sepah has European branches in Paris, Rome, and London.
Bank Sepah is a state-owned bank that the US Treasury Department stated is the 'bank of choice' for Iran's Aerospace Industries Organization (AIO). According to the US Treasury Department, 'AIO, a subsidiary of the Iranian Ministry of Defense and Armed Forces Logistics, oversees all of Iran's missile industries and is the overall manager and coordinator of Iran's missile program.'
The bank operates an estimated 1,700 branches within the Islamic Republic of Iran.
Large European banks have not launched business with Iran's financial system because of high risks and terror finance concerns. The Financial Action Task Force (FATF), an inter-governmental body, wrote in June on its website that it is 'concerned with the terrorist financing risk emanating from Iran and the threat this poses to the international financial system.' FATF noted that Iran does not meet its standards and will remain on the list of high risk countries along with North Korea.
Source: Jerusalem Post