The Dubai Financial Services Authority (DFSA) said yesterday it would require companies in the Dubai International Financial Centre free zone to "treat all transactions with clients domiciled in Iran as high-risk transactions". The announcement came in response to the UN Security Council resolution to impose sanctions on Iran.
The DFSA said companies should increase monitoring of financial transactions "particularly with the central bank of Iran, Bank Melli and Bank Saderat" or any other entity highlighted by the Security Council as high risk. "Regulated entities may also consider additional steps such as terminating the relationship with the relevant customer or account or suspending the relevant transaction pending further investigation" if they appear to evade sanctions or do not disclose enough information to determine whether they are evading sanctions, the DFSA said.
The Security Council imposed additional sanctions on Iran in resolution 1929, which was adopted on June 9. The resolution calls upon member states to restrict financial services to companies aiding Iran-related entities "if they have information that provides reasonable grounds to believe that such services, assets or resources could contribute to Iran's proliferation-sensitive nuclear activities, or the development of nuclear weapon delivery systems".
The Security Council directed the resolution especially at 41 new entities and individuals from Iran, including Bank Sepah International, Abzar Boresh Kaveh, Joza Industrial, and Sho'a' Aviation. Several individuals are also subject to asset freezes and travel bans, including Dawood Agha-Jani, the head of the Pilot Fuel Enrichment Plant at Natanz, and Mohammed Qannadi, the vice president of research and development at the Atomic Energy Organisation of Iran.
The DFSA said it would require all regulated entities to conduct risk assessments of relationships and due diligence processes with Iranian banks with an eye to amending their procedures to mitigate risks of unwittingly assisting them with the evasion of sanctions. All transactions should have documentation that shows the originator and beneficiary, the DFSA said. @Email:bhope@thenational.ae