There’s no denying that the Middle-East has a lot of tension and conflict these days. In neighboring Western Asia, Iran is also in the public eye quite often for various reasons. It got into the media spotlight just a few months ago when it concluded a deal with the West over its use of nuclear power.
Despite the apparent progress made in the deal, Iran is under fire once again. This time, it has received fierce criticism not from a Western government but the IMF. David Lipton is a deputy of the IMF’s managing director, Christine Lagarde.
When he spoke with Bloomberg News from Tehran recently, he didn’t mince his words about Iran. Specifically, he said that the country must stop funding terrorism and money laundering.
During his visit, Mr. Lipton said Iranian government and banks must raise their standards. He went on to say they must meet international standards if foreign banks and partners are to deal with them.
Mr. Lipton is Iran’s first senior IMF visitor since 1979 and the Islamic Revolution. Iranians might not be happy with his words. But, they echo what others in the banking industry elsewhere think about the country.
“Severe” illicit financial threat
Ever since the Iran nuclear deal, the West has been critical of Iran’s hesitation to change. In fact, one of Iran’s biggest critics is the Foundation for Defense of Democracies. For years, the think-tank carried out research and offered policy recommendations to the U.S.
Last month, the FDD’s executive director spoke about the Financial Action Task Force. He said that the FATF warned for years against Iran’s “severe” illicit financial threat.
But, it’s not just the FDD that has strong views on Iran’s illicit financial activities. Stuart Levey from HSBC in the UK recently wrote about Iran’s continuing terror financing.
Writing to The Wall Street Journal, Mr. Levey reiterated his bank’s position on Iran. In short, they aren’t going to do any new business with the country. Mr. Levey is the Chief Legal Officer at HSBC.
Those are just a handful of hundreds of comments political and financial experts made. They all result in the same general opinion of Iran: they are not to be trusted.
So, why is the West still apprehensive about doing business with Iran? The country has not hidden the fact that it supports terrorism. Iran is a prominent supporter of Hamas, for example.
Now that most of the country’s sanctions got lifted, is Iran likely to change its ways? For now, it would seem the answer is no, according to the experts.
One might think that Iran might change its ways in the future as it hopes to improve its economy. But, the hermit state still has plenty of deep-rooted anger at the West. In particular, the United States. The media is awash with stories about Iran stoking the fire of conflict.
Take, for example, the capture of U.S. naval ships in Iranian waters a few months ago. And what about the delivery of S-300 air defense systems to Iran from Russia.
It would seem Iran has a lot of work to do before it can convince the West that it can be trusted.