Currency Auction Likely To Be Cancelled In Response To International Pressure To Combat Financial Smuggling
October 14, 2024 Baghdad/Al-Masala: As part of the efforts made to reform the financial and economic system in Iraq, the Central Bank is moving towards canceling the currency auction, in response to international pressures aimed at regulating the circulation of the dollar and reducing illicit flows.
At the same time, the digital banking sector faces challenges related to the lack of legal legislation regulating its work, in light of the growth of this financial technology. In addition, there is increasing oversight of the real estate and gold markets to prevent money laundering operations, with the imposition of new mechanisms that limit suspicious transactions in this field.
Financial analyst Safaa Al-Shammari said that the Central Bank of Iraq is moving towards implementing a decision to cancel the currency auction, noting that these measures come in response to international pressure and strict negotiations. Al-Shammari also highlighted the need to develop the legislative framework for digital banks, which have begun to emerge without sufficient legal oversight.
Speaking on a TV show, Al-Shammari explained that “the Central Bank of Iraq will work to stop the currency auction as part of its commitment to the conditions imposed at the New York meeting,” adding that “the United States refuses for the dollar to reach entities subject to sanctions, which affects unofficial import operations, especially from Iran and Syria.”
Regarding digital banks, Al-Shammari stressed the urgent need for legal legislation to regulate the work of these new financial institutions, pointing out that there is a digital bank in the Kurdistan Region that has not obtained a license from the Central Bank. He also pointed to tightening control over the real estate market to combat money laundering, adding that “the gold trade has also come under strict control to prevent any violations.”
Tightening control over the real estate market to prevent money laundering requires a set of regulatory and supervisory measures in coordination between financial and banking bodies and legal entities.
These measures include imposing financial limits on real estate transactions that require additional monitoring, such that any purchase or sale exceeding a certain amount is subject to intensive financial investigations to ensure the legitimacy of the source of the funds.
Buyers and sellers must also be required to provide documents proving the source of funds used in transactions, and here banks play an important role in examining financial accounts and detecting suspicious transfers.
Analysts say it is essential to create a national database for all major real estate transactions to track financial movements related to real estate, making it easier to detect unusual patterns that may indicate money laundering. Cooperation between banks and regulatory bodies should also be enhanced, with banks monitoring accounts and financial transactions related to real estate transactions and reporting any suspicious activity to the relevant authorities.
In addition, strict laws are required to require parties involved in the real estate market to disclose the identity of the beneficial owner of a real estate transaction to track down parties that may seek to hide illicit funds.
The analysis indicated that international asset auditing is also important to ensure transparency of foreign investors’ investments and cross-border transactions. Banks play a pivotal role in combating money laundering by examining financial transactions related to real estate deals and verifying the sources of large amounts of money used in purchases. https://almasalah.com/archives/103271