U.S. officials have insisted that the nuclear agreement with Iran has not affected the continuation of sanctions on its ballistic missile program. Yet as part of the nuclear agreement, in addition to Bank Sepah and Sepah International, the United States removed from its blacklist seven other Iranian-controlled banks supporting Iran’s ballistic missile program, including banks that have provided financial services to Iran’s Ministry of Defense and Armed Forces Logistics (MODAFL), which controls AIO; banks that have facilitated the purchase of missile-related items; and banks that supported sanctions evasion by entities tied to Iran’s missile program. Four of the nine banks also have links to Iran’s Bank Saderat, which remains on the U.S. blacklist for its role in financing terrorism.

These nine banks remain on the U.S. Executive Order 13599 List, indicating that they are part of the Government of Iran or an Iranian financial institution and are therefore still off-limits to U.S. parties. However, the United States removed its secondary sanctions on these banks, which had extended U.S. sanctions to take aim at foreign parties that dealt with the banks. As a result, these banks are now able to reconnect to the SWIFT financial messaging service, which is critical for processing transactions. Many of the banks have also re-established commercial ties to Europe this year. One of the banks, the Export Development Bank of Iran, also extended a $1 billion line of credit in July 2015 to the Syrian Commercial Bank.

The nine Iranian-controlled banks linked to missile activity that were removed from the U.S. blacklist since the beginning of the year are described below. No evidence has been presented indicating that these banks have stopped engaging in the behavior that warranted sanctions in the first place. Yet these missile financing banks, while still cut off from the U.S. financial system, are now free to do business with the rest of the world. Thus, the United States has weakened one of its most powerful tools to counter Iran’s ballistic program—the targeted sanctions that effectively cut off the banks that finance Iran’s missile activity from large parts of the global financial system.

Bank Melli has provided financial services to the key Iranian agencies responsible for the ballistic missile program, including AIO, the Defense Industries Organization (DIO), a missile manufacturer, and SHIG and SBIG, both of which remain subject to U.N. sanctions. Through its financial services, Bank Melli has facilitated numerous purchases of sensitive material for Iran’s missile program. It also has links to terrorism through its transactions on behalf of the IRGC-Qods Force. Bank Melli also has ties to Bank Saderat, with which it established Future Bank B.S.C. in Bahrain as a joint venture. While never under U.N. sanction, Bank Melli was the subject of a warning in U.N. resolution 1803 that called for financial institutions to “exercise vigilance” with respect to Bank Melli due to its links to nuclear and missile-related activities.

Export Development Bank of Iran (EDBI) has provided handled transactions for MODAFL and other entities associated with Iran’s missile program and has facilitated procurement activities. EDBI also allegedly served as an intermediary handling financing, including WMD-related payments, for Bank Sepah after Bank Sepah was sanctioned in 2007. In July 2015, EDBI extended a $1 billion line of credit to the state-owned Syrian Commercial Bank, a form of financial aid to the Assad regime.

Bank Refah Kargaran has provided financial services to MODAFL and facilitated the millions of dollars of purchases by MODAFL of weapons-related items, including missiles. It has also served as a conduit for sanctions evasion, processing outstanding transactions for Bank Melli following the sanctions imposed on Bank Melli by the European Union. It also has ties to Bank Saderat and EDBI, with whom it founded Belarus-based Onerbank as a joint venture.

Europäisch-Iranische Handelsbank AG (EIH) is a German-based bank controlled by Iranian interests. It shareholders include Bank of Industry and Mine, Bank Mellat, and Bank Tejarat. EIH has reportedly done over a billion dollars of business for Iranian companies associated with conventional military and ballistic missile procurement, including AIO, DIO, and the Iranian Revolutionary Guard Corps (IRGC). In addition, it has acted as a conduit for payments on behalf of Iranian banks under sanction, including Bank Sepah, Bank Mellat, and Bank Saderat. When the nuclear agreement with Iran was announced, EIH stated that it was poised to “place its full range of services at the disposal of old and new customers.” In March 2016, EIH extended lines of credit totaling over 480 million euros to Iranian banks, including Bank of Industry and Mine, Bank Mellat, and Bank Tejarat.

Bank of Industry and Mine (BIM) helped several banks blacklisted for ballistic missile activity, including Bank Mellat and EIH Bank circumvent international sanctions, by concealing their involvement in payments. It is the majority stakeholder in EIH Bank and received a 108 million euro line of credit from the German bank in March 2016.

Bank Tejarat has provided financial services for MODAFL and other Iranian entities linked to the country’s missile program. It has begun re-establishing commercial ties to Europe. Last month, ten bankers from Bank Tejarat reportedly attended a class on compliance and European banking in the Netherlands. It also received a line of credit from EIH Bank in March 2016.

Bank Mellat had been sanctioned by the United States for facilitating hundreds of millions of dollars in transactions for Iranian nuclear, missile, and defense entities. It also received a line of credit from EIH Bank in March 2016.

Source» wisconsinproject