Earlier, in October 2019, the Financial Action Task Force (FATF) extended the last deadline for this country to adopt Countering the Financing of Terrorism (CFT) and Palermo conventions.

However, Iranian officials eventually made their genuine decision to continue supporting terrorism by delaying the issue for months. This defiance, of course, proved how important it is for the ayatollahs to meddle in neighboring countries, fund their terrorist proxies, and fuel ethnic and religious conflicts in the Middle East. It is in fact so vital for their rule that they prefer to bear more economic pressures and isolation rather than quit their costly aggressive policies in the region.

During this period, international supporters of the Iranian government, who have much benefited from the opaqueness of Iran’s economy, honestly attempted to extend the deadline.

However, Russia, China, and the E3 finally realized that the ayatollahs had made a strategic decision to defy the FATF standards. Interestingly, Iran was re-designated in the FATF blacklist under the rotating presidency of its close ally China, which shows the disappointment of Iran’s allies over any further concessions in this context.

What Results from Iran’s Entering into the FATF Blacklist?

FATF as a technical intergovernmental body has been established to protect the international financial system. This non-profit organization requires countries to set their financial transactions based on akin measures hoping to achieve a transparent banking system.

FATF, in fact, pursues to incite the countries for combating financing terrorism and money laundering as the main pillars for protecting the global financial system from risks. In other words, objecting to FATF standards is synonymous with the country’s support for terrorism.

On the other hand, Iran’s willful failure to uphold Anti-Money Laundering (AML) and terror finance standards, doing business with any Iranian bank, the insurance company, or other financial institutions, whether sanctioned or not, comes with heavy risks and high costs.

In such circumstances, Iran is supposed to sink into more economic crises. “Given oil sanctions and reduction in the country’s oil revenue, the country needs raw materials and money transfer for import/export affairs,” ILNA news agency quoted Sohrab Sharafi, the head of tourism commission of Fars chamber of commerce, as saying on February 22.

“If we could have limited money transferring with several small foreign banks, now, these banks with disconnecting their communication with [Iran] according to placing the country in the FATF blacklist… FATF’s decision will cause the reduction of the value of the national currency and the rise of the price of the dollar, euro, pound, dirham, and other foreign currencies,” Sharafi added.

The Political Consequences of Iran’s Blacklisting by the FATF

The Iranian government has a notorious record in terrorist activities that aren’t limited to the Middle East alone but also extend across the globe.

In 2018, the UN Security Council released a report highlighting al-Qaeda’s role in Iran. The report highlighted the Iranian government’s role in boosting the authority of al-Qaeda leader Aiman al-Zawahiri.

Earlier, since 2012, the U.S. State Department successively reported, “Iran has permitted al-Qaeda facilitators to operate a core facilitation pipeline through Iran since at least 2009, enabling the terrorist group to move funds and fighters to South Asia and Syria.”

Additionally, during the past couple of years, security officials in the United States and European countries revealed the role of Iran’s Revolutionary Guards (IRGC) and Ministry of Intelligence and Security (MOIS) in several terror plots in the West.

Notably, the German law-enforcement forces detained an Iranian senior diplomat Assadollah Assadi in June 2018. Assadi was arrested for delivering explosive material to terrorist operatives in Belgium for bombing against the Iranian opposition’s rally.

In December 2018, the Albanian government expelled the Iranian ambassador and his deputy due to their role in a similar terror plot against the members of the Mojahedin-e Khalq in this country.

In this regard, even the Iranian government’s allies such as Russia, China, Iraq, and others cannot turn a blind eye to the ayatollahs’ adventurism, which is the main danger to peace and security in the region.

They are truly crippled to cease the economic pressures on this country and provide remedies due to their economic affairs would put at risk. In this context, on January 24, Iraq’s embassy in Tehran submitted an announcement to the government that banned the exporting several agricultural products to this country. This country already banned importing several other agricultural products from Iran under the pretext of self-sufficiency in December 2019.

Further, then the economic consequences, the mentioned developments regarding Iran-Iraq relations, particularly after the Iraqi protests against the ayatollahs’ meddling in this country and now the blacklisting by the FATF show Iran are gradually losing its influence in other countries.

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Dirty Money; Another Obstacle to Iran’s Non-Joining FATF