Action Follows a Verified Change of Behavior from the Elaf Islamic Bank
WASHINGTON – The Department
of the Treasury today lifted sanctions against the Elaf Islamic Bank in Iraq
following the bank’s significant and demonstrated change in behavior.
On July 31, 2012 the Treasury Department imposed sanctions under
the Comprehensive Iran Sanctions, Accountability, and Divestment Act of 2010
(CISADA), against Elaf Islamic Bank, a privately-owned Iraqi financial
institution, for knowingly facilitating significant transactions and providing
significant financial services for the U.S. and EU-designated Export
Development Bank of Iran (EDBI). Following the CISADA finding, Elaf immediately
engaged the Treasury Department and began an intensive course of action to stop
the conduct that led to the CISADA sanction, including freezing EDBI accounts at
Elaf and reducing its overall exposure to the Iranian financial sector. Following today’s action U.S. financial
institutions are once again permitted to open or maintain correspondent
accounts or payable-through accounts in the United States for Elaf Islamic
“Today we welcome Elaf Islamic Bank back into the U.S.
financial system, and we urge other designated individuals and entities around
the world to follow its positive example.
As today’s delisting demonstrates, our sanctions are flexible and can be
lifted if the conduct that led to the sanction terminates,” said Under
Secretary for Terrorism and Financial Intelligence David S. Cohen. “As we increase our sanctions against Iran,
we will continue to target any financial institution that works with designated
Iranian banks or attempts to assist Iran in evading sanctions.”
Sanctions may be, and regularly are, lifted when
circumstances warrant, which includes ceasing the sanctionable activity. Any sanctioned party may petition OFAC for
sanctions to be lifted. In general, demonstrating
changes in circumstances or behavior are essential to the lifting of sanctions.
Treasury will continue to use all tools at its disposal to
target entities or individuals engaging in sanctionable activity related to
Iran. CISADA was signed into law by
President Obama in July 2010. Among
other things, CISADA provides the Secretary of the Treasury with the authority
to impose strict conditions on, or prohibit the opening or maintaining of,
correspondent accounts or payable-through accounts in the United States for
foreign financial institutions that knowingly facilitate a significant
transaction or provide significant financial services for a person whose
property and interests in property are blocked under the International
Emergency Economic Powers Act in connection with Iran’s proliferation of weapons
of mass destruction (WMD) or delivery systems for WMD, or for Iran’s support
for international terrorism.