The Paris-based Financial Action Task Force (FATF) on Friday placed Iran on its blacklist for failing to comply with international anti-terrorism financial rules. The FATF, a 200-member intergovernmental body, sets standards and monitors implementation of anti-money laundering and counters financing of terrorism policies. Iran was said to have not done enough to criminalize terrorist financing, require transparency in wire transfers or freeze terrorist assets targeted by UN sanctions. In consequence, the FATF will act to make trading with the Islamic Republic cumbersome to the point of deterring foreign banks and firms from doing business with Iran, leading to higher costs of borrowing and isolation from the global financial system. The EU will most likely have to end talks with the Islamic Republic about exploiting INSTEX as a trade vehicle for circumventing US sanctions. Iran joins North Korea as the only countries blacklisted by the FATF.
The new hit to Iran’s economy coincided with its general election. The closure of polling stations was postponed twice to stimulate the slow voter turnout.