BAGHDAD: Iraq’s premier said Tuesday that new banking regulations had revealed fraudulent dollar transactions made from his country, as the fresh controls coincide with a drop in the local currency’s value.
Iraq has in recent months been making efforts to ensure its banking system is compliant with the international electronic transfer system known as SWIFT.
Referring to the new controls, Prime Minister Mohammed Shia Al-Sudani hailed “a real reform of the banking system,” but denounced “falsified invoices, money going out fraudulently,” in particular as foreign currency payments for imports.
“That is a reality,” he said in an interview on state television.
The adoption of the SWIFT system was supposed to allow for greater transparency, tackle money laundering and help to enforce international sanctions, such as those against Iran and Russia.
An adviser to Sudani had said that since mid-November, Iraqi banks wanting to access dollar reserves stored in the United States must make transfers using the electronic system.
The US Federal Reserve will then examine the requests and block them if it finds them suspicious.
According to the adviser, the Fed had so far rejected 80 percent of the transfer requests over concerns of the funds’ final recipients.
Before the introduction of the new regulations, “we were selling $200 million or $300 million a day,” Sudani said.
“Now, the central bank provides $30 million, $40 million, $50 million,” he said, questioning: “What were we importing in a single day for $300 million?“
“There are products that were entering (Iraq) for prices that make no sense. Clearly, the objective was to take foreign currency out of Iraq,” he said. “This must stop.”
Money may have been transported to Iraq’s autonomous Kurdistan province “and from there to neighboring countries,” Sudani said, without specifying whether he was referring to Turkiye, Iran or war-torn Syria.
He said the new controls had been planned for two years, in accordance with an agreement between Iraq’s central bank and US financial authorities, and deplored previous failures to put them in place.
Iraq, which is trying to move past four decades of war and unrest, is plagued by endemic corruption.
The official exchange rate is fixed by the government at 1,470 dinars to the dollar, but the currency was trading at around 1,680 on Tuesday on unofficial markets amid dollar scarcity.
The drop has sparked sporadic protests by Iraqis worried about their purchasing power.
Foreign Minister Fuad Hussein and the new central bank chief will be among a delegation traveling to Washington on February 7 to discuss the new mechanism and the fluctuating exchange rate, Sudani said.
Iraqi PM says banking reforms reveal fraudulent dollar transactions
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Iraqi PM says banking reforms reveal fraudulent dollar transactions
- Iraq has in recent months been making efforts to ensure its banking system is compliant with the international electronic transfer system known as SWIFT
UN chief condemns Israeli law blocking electricity, water for UNRWA facilities
- The agency provides education, health and aid to millions of Palestinians in Gaza, the West Bank, Jordan, Lebanon and Syria
United Nations Secretary General Antonio Guterres condemned on Wednesday a move by Israel to ban electricity or water to facilities owned by the UN Palestinian refugee agency, a UN spokesperson said.
The spokesperson said the move would “further impede” the agency’s ability to operate and carry out activities.
“The Convention on the Privileges and Immunities of the United Nations remains applicable to UNRWA (United Nations Relief and Works Agency for Palestine Refugees in the Near East), its property and assets, and to its officials and other personnel. Property used by UNRWA is inviolable,” Stephane Dujarric, spokesman for the secretary-general, said while adding that UNRWA is an “integral” part of the world body.
UNRWA Commissioner General Phillipe Lazzarini also condemned the move, saying that it was part of an ongoing “ systematic campaign to discredit UNRWA and thereby obstruct” the role it plays in providing assistance to Palestinian refugees.
In 2024, the Israeli parliament passed a law banning the agency from operating in the country and prohibiting officials from having contact with the agency.
As a result, UNRWA operates in East Jerusalem, which the UN considers territory occupied by Israel. Israel considers all Jerusalem to be part of the country.
The agency provides education, health and aid to millions of Palestinians in Gaza, the West Bank, Jordan, Lebanon and Syria. It has long had tense relations with Israel but ties have deteriorated sharply since the start of the war in Gaza and Israel has called repeatedly for UNRWA to be disbanded, with its responsibilities transferred to other UN agencies.
The prohibition of basic utilities to the UN agency came as Israel also suspended of dozens of international non-governmental organizations working in Gaza due to a failure to meet new rules to vet those groups.
In a joint statement, Canada, Denmark, Finland, France, Iceland, Japan, Norway, Sweden, Switzerland and the United Kingdom said on Tuesday such a move would have a severe impact on the access of essential services, including health care. They said one in three health care facilities in Gaza would close if international NGO operations stopped.
