Sanctions on Foreign Financial Institutions under the Comprehensive Iran
Sanctions, Accountability, and Divestment Act
WASHINGTON – The U.S.
Department of the Treasury today announced the imposition of sanctions under
the Comprehensive Iran Sanctions, Accountability, and Divestment Act of 2010
(CISADA), against two financial institutions for knowingly facilitating
significant transactions and providing significant financial services for
designated Iranian banks. The financial
institutions sanctioned today are Bank of Kunlun in China and Elaf Islamic Bank
Acting to expose and isolate Iranian financial institutions
connected to Iran’s WMD proliferation or support for terrorism, the Treasury
Department has imposed sanctions against two dozen Iranian banks. As financial institutions around the world
have cut ties with these designated Iranian banks, Bank of Kunlun and Elaf
Islamic Bank took the opposite approach by providing financial services to
designated Iranian banks and facilitating the movement of millions of dollars
worth of international transactions.
“Our actions to cut off Kunlun and Elaf from the U.S.
financial system underscore Treasury’s commitment to use all the tools at its
disposal to intensify financial pressure against Iran while protecting the U.S.
financial system from illicit activity,” said Under Secretary for Terrorism and
Financial Intelligence David S. Cohen.
“Any bank, anywhere, that seeks to provide a financial lifeline to
Iran’s designated financial institutions should know that it will be held
accountable and its activity will be exposed.”
Today’s action against Bank of Kunlun and Elaf Islamic Bank
effectively bars them from directly accessing the U.S. financial system. As a result of the sanctions imposed today
under CISADA, financial institutions may not open correspondent or
payable-through accounts for Bank of Kunlun or Elaf Islamic Bank in the United
States and any financial institutions that currently hold such accounts must
close them within 10 days.
Bank of Kunlun
Bank of Kunlun has provided
significant financial services to more than six Iranian banks that were
designated by the United States in connection with Iran's weapons of mass
destruction (WMD) programs or its support for international terrorism. .
Bank of Kunlun has provided
hundreds of millions of dollars worth of financial services to these designated
banks, including holding accounts, making transfers, and paying their letters
In early 2012, Bank of Kunlun transferred
hundreds of payments totaling roughly $100 million dollars from accounts it
holds for designated Bank Tejarat. This
activity happened after Bank Tejarat was designated by the United States (and
the European Union) in January 2012 for providing financial services to several
Iranian banks and firms already subject to sanctions for their involvement in
Iran’s illicit proliferation activities.
In addition to these transfers, in
early 2012 Bank of Kunlun made at least one payment for an affiliate of Iran’s
Islamic Revolutionary Guard Corps pursuant to a letter of credit opened by Bank
Elaf Islamic Bank
Elaf Islamic Bank, a privately-owned
Iraqi financial institution, has facilitated significant financial transactions
and provided significant financial services for a designated Iranian bank. Iraq's Elaf Islamic Bank has engaged in
activity during the past year worth tens of millions of dollars with the Export
Development Bank of Iran, which was designated by the United States in October
2008 and also designated by the European Union in July 2010 for its support of
Iran’s proliferation activities.
Provisions of CISADA
CISADA was signed into law by President Obama in July
2010. It 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 the Secretary
the efforts of the Government of Iran, including Iran’s Islamic
Revolutionary Guard Corps (IRGC), to acquire WMD or delivery systems for
WMD or to support international terrorism.
the activities of a person subject to financial sanctions under certain
United Nations Security Council Resolutions related to Iran.
in money laundering, or facilitate the efforts of the Central Bank of Iran
or any other Iranian financial institution, to carry out the activities
a significant transaction or provide significant financial services for
the IRGC or its agents or affiliates whose property and interests in
property are blocked under the International Emergency Economic Powers Act
(IEEPA); or a financial institution whose property and interests in
property are blocked under IEEPA in connection with Iran’s proliferation
of WMD or delivery systems for WMD or Iran’s support for international
The Treasury Department has issued the Iranian Financial
Sanctions Regulations (IFSR) to implement these and other provisions of CISADA.
To view more
information on the IFSR, click here.
Bank of Kunlun Co. Ltd.
FKA: Karamay Urban Credit
FKA: Karamay City Commercial Bank
Location 1: (Head Office) 9 Dongzhimen North Street,
Dongcheng District, Beijing 100007, China
Location 2: (Registered Office)
No. 7 Century Ave, Karamay 834000 Xinjiang, China
Location 3: (Daqing, Heilongjiang
Branch) 172 Xibin Rd, Ranghulu District, Daqing 163453
Location 4: (Urumqi, Xinjiang
Branch) No. 68 Zhongya South Rd, Economic and Technological Development Zone,
SWIFT/BIC: CKLB CN BJ
Elaf Islamic Bank
Address: PO Box 3440, Bldg No. 14,
Street 99, Hai Al Wehda-Mahala 902, Alweih, Baghdad, Iraq
SWIFT/BIC: ELAF IQ BA