How I learned to stop worrying and love sanctions
I shouted it from the rooftops for months; any sanctions efforts against Iran would invariably have to hit their banking institutions. Finally, on November 8th, it happened. SWIFT has signaled it would disconnect sanctioned Iranian banks from the global banking network, officially shitcanning Iran’s economy.
It’s hard to overstate exactly how big of a deal this is. To note, the 2018 SWIFT sanctions are FAR more expansive than the SWIFT sanctions in 2012. When the sanctions against Iran’s banks were first introduced in 2012, it primarily targeted Iran’s largest banks which were partially state-owned. The recent sanctioned passed by the United States, on the other hand, hit around 50 banks in Iran (roughly Iran’s entire banking network, or very close to all of it), on top of Iran’s Central Bank chief having already been sanctioned for having previously assisted Iran’s banks from 2012-2016 in evading sanctions by channeling transactions through Iran’s central bank.
Allow me to provide even more context. SWIFT is the Belgium-based international communications network that provides banks a messaging system to transfer money between themselves. Each bank has a code that specifies its country of origin, what bank it is, and even down to the local branch of the bank. A series of standardized codes allows a bank to transfer money from itself to another bank across the world, recording the transaction. It’s a robust network that encompasses over 11,000 banks worldwide, and is a virtual necessity for conducting ANY international transactions.
The sanctions on Iran’s banks are due to their worldwide support of terrorism. I’ll go into further details later, but essentially, all of Iran’s banks are either a) government-backed institutions that serve as money laundering platforms for Iran’s elites, b) IRGC-owned institutions that serve as money laundering for Iran’s elites, or c) they’re owned by one of Iran’s elites with the express permission of the Mullahs or the IRGC. As Iran’s government and IRGC are inextricably religious, it is safe to call Iran theocratic socialism; the government or the IRGC is involved in or owns basically the entire Iranian economy, and that money is used to export war and terrorism nationwide. ISIS fighters in the Phillipines, Hamas in Gaza, the Muslim Brotherhood, the Taliban, al Qaeda, ‘activists’ in Saudi Arabia, paying off friendly journalists in the west, Iran’s banks are often used as conduits for getting cash to where its needed to fund death and destruction.
SWIFT sanctions effectively cuts off their primary legal method of getting this money out nationwide. HOWEVER, this is not the only way Iran’s been working to fund their affiliates worldwide. Doubly however, the United States and its allies has NOT been sitting idle. See, President Trump and his administration may take a lot of flak, but their greatest skill is almost certainly how well they’re able to prepare a battlefield before actually engaging, to ensure the minute they do make an official public move it is as devastating as possible.
What’s that? You want… EXAMPLES?
How about when Daphne Caruana Galizia, the Panama Papers journalist, was killed in Malta by a car bomb? Did anyone ever wonder why the FBI was all over investigating that assassination of a journalist? Well, there was a private bank in Malta, Pilatus Bank, who was owned by the Iranian Seyed Ali Sadr Hasheminejad, who was arrested soon after the death of Galizia, and whose bank was shut down, all assets frozen, do not pass go do not collect $200. This bank was one of the non-Iran based conduits for Iran to ship money overseas in the evasion of sanctions, most typically to IRGC shell companies in South America who had set up shop building dams and other public works projects to provide a cover story for their agents and friendly Hezbollah to enter South America.
There was also the example of the Iranian group that was sanctioned after it was discovered they were using UAE money exchanges to launder money out of the country. This was part of how the Iranian Central Bank governor was nailed with sanctions; he would print Iranian Rials, essentially more worthless than money from the board game LIFE at this point (definitely more worthless than monopoly money. I would shiv a granny for a 500), and dump it into the bank accounts of Iranians labeled as ‘oil revenues’, from which it would be exchanged for currencies that were worth a damn, and then sent to their terrorist buddies worldwide. Shut down and stopped.
Without a doubt, there were far more money-laundering efforts being made by the Iranians to obfuscate their support for terror groups worldwide. The first argument against SWIFT sanctions would almost invariably be, “But, wouldn’t Iran just find new ways to get money out of their country?!” Sure, if this was still the Obama administration and our intel agencies were under orders to keep their thumbs shoved squarely up their asses to let Iran run roughshod worldwide. But this is the Trump administration. He made sure, that by the time SWIFT cut off the networks, these alternate money laundering sources were ALREADY getting shut down.
Now? Just sit back for a couple weeks, maybe a month or two, sip on a glass of bourbon, and watch the goddamn fireworks.