U.S. investigates business with Iran

Stephen Beard Jan 12, 2009


Scott Jagow: The U.S. government is looking into some nefarious behavior by European banks. They’re essentially accused of doing business with Iran, Sudan and Libya. And the U.S. government doesn’t allow business dealings with those countries.

Our European correspondent Stephen Beard joins us. First off, Stephen, what banks are we talking about?

Stephen Beard: According to The Financial Times in London, there are nine European banks that are under investigation by the U.S. authorities. Just last week, we learned that Lloyd’s, a major British bank, has admitted that it was involved in sanctions violations, and it’s agreed to pay $350 million in fines to the U.S. and share all the records of its Iranian transfers.

Jagow: And what exactly are the banks accused of doing?

Beard: Well, the allegation is that these banks may have been transferring Iranian cash through the U.S. banking system, but disguising the origin of these funds by a process known as stripping — a process whereby banks strip out information from wire transfers which indicate the source of the money. Inevitably, these banks have been described here in London as members of the “strip club.”

Jagow: And do we have any evidence of a connection between Iran’s military ambitions and this money?

Beard: There does appear to be some connection. An e-mail has come to light indicating that Iran has been trying to buy large amounts of tungsten, which apparently is used in the manufacture of long-range missiles. Also used to make refrigerators. And according to the Manhattan district attorney, one of these e-mails was for 30,000 metric tons of tungsten — enough, he said, to make a refrigerator for every household in the Middle East.

Jagow: All right, we’ll keep an eye on this story. Stephen Beard in London. Thank you.

Beard: OK, Scott.

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