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Iran's Hardliner Judiciary Denies Rouhani Claim Anti-Corruption Bills Were Approved

FATF (Financial Action Task Force) President Xiangmin Liu attends a news conference after a plenary session at the OECD Headquarters in Paris, October 18, 2019

Hours after Iran’s presidency announced the approval of internationally mandated anti-corruption and anti-money laundering bills, the hardliner Judiciary denied any agreement between the three branches of power.

On Wednesday, Rouhani’s chief of staff Mahmoud Vaezi announced that a special council headed by the president, speaker of parliament and the head of the Judiciary have approved the long-debated bills demanded by the international financial watchdog, Financial Actions Task Force or FATF.

However, he added that he was not aware of Khamenei's view on the three controversial bills.

Almost immediately the Judiciary issued a statement calling Vaezi’s claim “untruthful”.

The statement added that the head of the Judiciary, Ebrahim Raeesi has never discussed the FATF bills in the council of the three branches of power.

Speaking to his cabinet earlier on Wednesday, October 23, Rouhani asserted, "The three bills of transparency, anti-corruption, and conflict of interest have been drafted and approved, and we believe that until there is no transparency in the country, the rest is just showing off, and it does not benefit the nation."

In October, the U.S. Secretary of State Mike Pompeo said that if Iran were serious about fighting money laundering and financing terrorism, it would have approved laws to make the country in par with international standards.

The international watchdog Financial Action Task Force (FATF) based in Paris in 2017, demanded Iran reform its legal system and banking practices by following international conventions in order to become eligible for unrestricted international banking relations. FATF has put Iran on its blacklist, pending legal reforms by Tehran.

However, Iran dragged its legislation for more than a year and altogether froze the reforms in early 2019. The FATF has given the last deadline to Iran for February.

The opponents of the bills, mainly Friday Prayer leaders, IRGC top commanders, and other conservative allies of Supreme Leader Ayatollah Ali Khamenei, have repeatedly argued that passing the bills will threaten Iran's security. In contrast, analysts say the real fear in circles loyal to Khamenei is that adhering to rules for financial transparency would prevent Tehran from funding the Lebanese Hezbollah and Palestinian Hamas militant groups.

But there are also the financial interests of powerful regime officials and their businesses that have so far functioned in an environment free of international standards.

President Hassan Rouhani presented the proposal to meet FATF's demands to parliament in November 2017. Supporters of the legislation, known collectively as the Palermo Bills in Iran, say joining the FATF and other international agreements on financial transparency, money laundering, and combatting international terrorism would reduce international pressure on Iran's already deteriorating economy.

The bills would also pave the way for Iran to join the United Nations Convention Against Transnational Organized Crime (UNTOC), Combatting the Financing of Terrorism (CFT), and the United Nations Office of Drugs and Crimes.

It is not clear what exactly is Ayatollah Ali Khamenei's position on the final adoption of these laws.

Khamenei has the last word on all sensitive matters in Iran.