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Switzerland bank to pay fines for violating US sanctions against Iran

By Bernard Hibbitts (editor) and University of Pittsburgh School of Law students.

[JURIST] Credit Suisse, Switzerland's second largest bank, agreed Wednesday to pay more than $500 million in fines to both the US government and New York state for violating US sanctions against Iran and other countries. According to a criminal information filed Wednesday, Credit Suisse violated the International Emergency Economic Powers Act (IEEPA) between 2002 and 2007 by helping businesses from Iran, Cuba, Sudan, Libya, and Myanmar get around American banking laws. Allegations include that Credit Suisse employees put together a pamphlet for Iranian clients, instructing them how to disguise their forms in order to escape notice and gain access to American markets. US Attorney General Eric Holder commented:The sanctions put in place against these countries have been deemed appropriate and necessary by numerous Administrations, and are followed by hundreds of financial institutions around the globe. And these rules matter - they keep dollars out of the hands of countries and individuals that threaten U.S. interests abroad and our national security here at home. The U.S. financial system is built on trust and transparency. Our banks must know what payments they are processing and for whom. Credit Suisse's decades-long scheme to flout the rules that govern our financial institutions robbed our system of the legitimacy that is fundamental to it success. We cannot let this stand, and today's settlement sends a strong message that we will not let it stand.Two of the Iranian organizations involved were the Atomic Energy Organization of Iran and the Aerospace Industries Organization, both of which are accused of proliferating nuclear weapons. In January, Lloyds TSB, a London-based bank, paid $350 million in fines resulting from transactions originating in Iran, Sudan, and Libya. In that case, it is still unclear what Iranian organizations started the transactions. IEEPA has been used since the 1930s to regulate and restrict the access of foreign powers to American financial markets. Iran has been restricted under IEEPA since the 1979 hostage crisis and has continued to be restricted as a state sponsor of terrorism. Iran's relations with the US have stalled since August when it threatened to withdraw from the International Atomic Energy Agency (IAEA) if its "nuclear rights" are revoked. The IAEA and the western powers are particularly concerned about Iranian activities that might lead to the production of nuclear weapons. Iran has repeatedly insisted that its enrichment activities are not weapons-related.

Full post as published by JURIST - The Paper Chase on December 17, 2009 (boomark / email).