Lavrov Calls US Sanctions on Iran ‘Illegitimate’, Slams Pressure on SWIFT
Sputnik – 06.11.2018
Washington implemented tough unilateral sanctions against the Islamic Republic on Monday following President Trump’s withdrawal from the Iran nuclear deal in May.
Russian Foreign Minister Sergei Lavrov has condemned Washington’s decision to slap Tehran with sanctions, calling the restrictions “absolutely illegitimate” and deeply disappointing, and saying that it was “unacceptable” to hold dialogue in the language of ultimatums.
“As far as the US measures against Iran are concerned, they are absolutely illegitimate,” Lavrov said on Tuesday in Madrid following a meeting with Spanish officials.
“They are being implemented in flagrant violation of the decisions of the UN Security Council, and the way in which these measures are announced and implemented cannot but cause a deep sense of disappointment. We proceed from the idea that the norms of not only international law, but of international dialogue, have not been repealed,” Lavrov stressed.
“Pursuing a policy based on ultimatums and one-sided demands is hardly permissible in our times,” according to the Russian foreign minister.
Pressure on SWIFT Also Unacceptable
Commenting on suspected US pressure on international financial messaging system SWIFT, which implied Monday that it would comply with US sanctions against Iranian financial institutions, Lavrov said that such pressure was also illegitimate.
“Within the framework of the participants of the Joint Comprehensive Plan of Action (JCPOA) agreement, mechanisms are being developed which will allow for the continued implementation of the provisions of this document, first of all as regards [nations’] economic ties to Iran without US participation, and this is not a simple matter,” the foreign minister explained. “You can see how, using unacceptable methods, pressure has been placed on the operators of the SWIFT system. But experts are actively engaged in these issues, and they have a sufficiently stable understanding that this is possible and that such measures will be found.”
On Monday, Washington followed through with plans to renew sanctions against Iran following President Trump’s exit from the JCPOA Iran nuclear deal. The tough sanctions target Iran’s energy, banking and sea-based transport sectors, and threaten so-called secondary sanctions against foreign companies and countries doing business with the Islamic Republic.
The Belgium-based SWIFT financial messaging service announced that it would be suspending some Iranian banks’ access to the system, making no mention of US sanctions. Calling the move “regrettable,” SWIFT’s statement said it had taken the step “in the interest of the stability and integrity of the wider global financial system.”
All of the JCPOA’s other signatories, including Iran, Russia, China and several European powers, have made an effort to save the landmark nuclear deal and bypass the US sanctions or otherwise limit their impact. This has included the development of a Special Purpose Vehicle (SPV) on trade. China and India, the largest importers of Iranian crude oil, have resisted US secondary sanctions threats, and were granted exemptions along with five other oil-importing countries plus Taiwan.
Austria casts doubt on immediate bans lift from Iran
Press TV – March 30, 2016
Austrian President Heinz Fischer has cast doubt on the US and Western resolve for the immediate removal of all anti-Iran sanctions.
Fischer has told IRIB that it is unclear how long it will take for the West to lift sanctions on Iran.
Iran’s historic agreement last year with permanent UN Security Council members plus Germany (P5+1) went into force on January 16 to end 13-years of Western dispute over Tehran’s nuclear program and pave the way for the lifting of sanctions on the country.
But more than two months later, Iran is still awaiting the full opening of business transactions with some companies in the West as some banks are facing restrictions in the US on handling business with Tehran.
The Austrian leader said it was not up to a single country to lift all the sanctions, but that the United States had a part to play.
“Austria alone cannot lift the sanctions. The EU cannot do it alone too, but it is the international community that should do it,” Fischer said.
“The US also plays a role in this regard,” he added.
“A process for sanctions removal has begun, but I cannot make any predictions on how long this issue will last. I hope all sides fully adhere to the [nuclear] agreement.”
The Austrian president was answering a question on issues facing Iranian banks, some of which still seek to join the international payments system, SWIFT, for the resumption of foreign transfers.
The Austrian leader paid a visit to Tehran in September 2015 at the head of a 240-member delegation with the purpose of discussing ways to improve Tehran-Vienna relations.
Not all the banks in Iran have been able to reconnect to SWIFT since the lifting of sanctions was announced in January.
A senior Iranian official said last month that 26 Iranian banks have so far been reconnected to SWIFT after the removal of the economic sanctions against Iran in mid-January.
SWIFT – the Society for Worldwide Interbank Financial Telecommunication – is used by nearly every bank around the world to send payment messages that lead to the transfer of money across international borders. It provides a wide range of service including transmitting letters of credit, payments and securities transactions among 9,700 banks in 209 countries.
However, it became off limits to Iranian banks in 2012 after the implementation of the US-led sanctions against the country. Accordingly, around 30 Iranian banks were blocked from using SWIFT services, literally cutting off Iran from the global banking system.
Anti-Russian Sanctions Cost West Influence, Credibility, and $100 Billion
Sputnik – 26.12.2015
For nearly two years, independent journalists and analysts in the US and Europe have been saying that sanctions against Russia should be repealed. Now, surprisingly, even the hawkishly anti-Russian foreign policy journal Foreign Affairs has joined the chorus, a recent article suggesting that sanctions have been nothing but a costly mistake.
The comprehensive analysis, written by CATO Institute Visiting Fellow Emma Ashford, offers few kind words for Russia or its leaders, using phrases like ‘Kremlin cronies’, and alluding to Russia’s ‘behavior’, as if the country was a child that needed to be taught a lesson. Nonetheless, as far as Western sanctions against Russia are concerned, Ashford laid down the truth. And the truth stings.
At first glance, the analyst suggested, “considering the dire state of Russia’s economy, [Western] sanctions might appear to be working. The value of the ruble has fallen by 76 percent against the dollar since the restrictions were imposed, and inflation for consumer goods hit 16 percent in 2015. That same year, the International Monetary Fund estimated, Russia’s GDP was to shrink by more than three percent.”
“In fact, however,” she notes, “Western policymakers got lucky: the sanctions coincided with the collapse of global oil prices, worsening, but not causing, Russia’s economic decline. The ruble’s exchange rate has tracked global oil prices more closely than any new sanctions, and many of the actions taken by the Russian government, including the slashing of the state budget, are similar to those it took when oil prices fell during the 2008 financial crisis.”
“The sanctions have inhibited access to Western financing, forcing Russian banks to turn to the government for help. This has run down the Kremlin’s foreign reserves and led the government to engage in various unorthodox financial maneuvers, such as allowing the state-owned oil company Rosneft to recapitalize itself from state coffers. Yet the Russian government has been able to weather the crisis by providing emergency capital to wobbling banks, allowing the ruble to float freely, and making targeted cuts to the state budget while providing financial stimulus through increased spending on pensions.”Therefore, Ashford points out, “even with continued low oil prices, the [IMF] expects that growth will return to the Russian economy in 2016, albeit at a sluggish 1.5 percent.”
“Nor are the sanctions inflicting much pain on Russia’s elites,” the analyst wistfully continues. “Although Prada and Tiffany are doing less business in Moscow, the luxury housing market is anemic, and travel bans rule out weekend jaunts to Manhattan, these restrictions are hardly unbearable. One target, the close Putin adviser Vladislav Surkov, has dismissed them as harmless. “The Only things that interest me in the US are Tupac Shakur, Allen Ginsberg, and Jackson Pollock,” he said. “I don’t need a visa to access their work.””
Most importantly, Ashford notes, “when the sanctions are judged by the most relevant metric –whether they are producing a policy change – they have been an outright failure.”
“Whatever punishment the sanctions have inflicted on Russia,” Ashford writes, “it has not translated into coercion,” despite the Obama administration’s expectations “that it would have by now.”
Furthermore, “the Kremlin has also managed to circumvent the sanctions, partly by turning to China. In May 2014, Putin visited the country to seal a 30-year, $400 billion gas deal with it, demonstrating that Russia has alternatives to European gas markets. That October, Moscow and Beijing also agreed to a 150 billion yuan currency swap, allowing companies such as Gazprom to trade commodities in rubles and yuan – and thus steer clear of US financial regulations.””Even in Europe,” the analyst points out, “Russia has been able to find loopholes to avoid sanctions: in order to obtain access to Artic drilling equipment and expertise, Rosneft acquired 30 percent of the North Atlantic drilling projects belonging to the Norwegian company Statoil.”
Paradoxically, Sanctions Boost Putin’s Popularity
As for the sanctions’ impact on Russia’s political leadership, Ashford suggests that this may be the area where they are “most counterproductive. The sanctions have had a ‘rally round the flag’ effect as the Russian people blame their ills on the West. According to the Levada Center, a Russian research organization, Putin’s approval rating increased from 63 percent” before Crimea’s accession to Russia “to 88 percent by October 2015. In another poll, more than two-thirds of respondents said they thought the primary goal of the sanctions was to weaken and humiliate Russia.”
… And Weaken Western Influence Worldwide
Moreover, Ashford argues, sanctions “have also encouraged Russia to create its own financial institutions, which, in the long run, will chip away at the United States’ economic influence. After US senators and some European governments suggested that the United States might cut off Russia’s access to the Society for Worldwide Interbank Financial Telecommunication (SWIFT) payment system, the Russian Central Bank announced that it was going to start negotiations with the other BRICS states – Brazil, India, China, and South Africa – to create an alternative.”
“To lessen its dependence on Visa and MasterCard, Russia has made moves toward setting up its own credit-card clearing-house. And it has moved ahead with the proposed BRICs development bank, which is designed to replicate the functions of the World Bank and the International Monetary Fund.”
These measures add up, Ashford suggests, raising “the worrying possibility that the United States will someday have a harder time employing economic statecraft,” (i.e. applying economic pressure), not just against Russia, but against other, smaller nations as well. “In a world where more institutions fall outside the reach of the United States and its allies, [potential] targets can more easily circumvent US sanctions.”
A $100 Billion Mistake
“It is true,” the analyst notes, “that the sanctions have allowed the Obama administration to claim that it is doing something about Russian aggression. From the White House’s perspective, that might be an acceptable rationale for the policy, so long as there were no downsides. In fact, however, the sanctions carry major economic and political costs for the United States and its European allies.”
“The brunt is being borne by Europe, where the European Commission has estimated that the sanctions cut growth by 0.3 percent of GDP in 2015. According to the Austrian Institute of Economic Research, continuing the sanctions on Russia could cost over 90 billion euros [$98.75 billion US] in export revenue and more than two million jobs over the next few years.”
The sanctions, Ashford writes, “are proving especially painful for countries with strong trade ties to Russia. Germany, Russia’s largest European partner, stands to lose almost 400,000 jobs. Meanwhile, a number of European banks, including Societe Generale in France and Raiffesen Zentralbank in Austria, have made large loans to Russian companies, raising the worrying possibility that the banks may become unstable, or even require bailouts if the borrowers default.”US companies, further away and less heavily involved in trade with Russia, are nonetheless also taking a big hit, according to the analyst.
“US energy companies, for their part, have had to abandon various joint ventures with Russia, losing access to billions of dollars of investments. Thanks to prohibitions on the provision of technology and services to Russian companies, Western firms have been kept out of unconventional drilling projects in the Artic and elsewhere. ExxonMobil, for example, has been forced to withdraw from all ten of its joint ventures with Rosneft, including a $3.2 billion project in the Kara Sea.”
This, Ashford says, will cost the company “access to upstream development projects” in Russia, while “putting the company’s future profits and stock valuation at risk and raising the possibility that the money they’ve already invested will be permanently lost.”
“A similar dynamic may harm European energy security, too,” threatening shortfalls in the supply of Russian energy. “The energy consultancy IHS Cambridge Energy Research Associates has predicted that if the sanctions persist, Russian oil production could decrease from 10.5 million barrels per day now to 7.6 million barrels per day by 2025 – bad news for European states, which receive one-third of their oil from Russia. They are even more dependent on Russian gas, which, since it relies more on fixed pipelines, is harder to replace.”
Ultimately, Ashford notes, “it is tempting to believe that the sanctions will eventually work – say, after a few more years –but that is wishful thinking.”
“If the United States continues to insist that the sanctions against Russia need more time to work, then the costs will continue to add up, while the likelihood of changing the Kremlin’s behavior will get even slimmer.”In the final analysis, the expert calls for the winnowing of sanctions, and for an increased effort by US diplomats “to work with their Russian counterparts on issues unrelated to the Ukraine crisis. The United States and Russia collaborated on the Iran nuclear deal,” Ashford recalls, and can cooperate on ending the civil war in Syria, too.
“Engaging Russia on this and other non-Ukrainian issues would avoid isolating it diplomatically and thus discourage it from creating or joining alternative international institutions,” the analyst slyly concludes.
The NSA Is Also Grabbing Millions Of Credit Card Records
By Tim Cushing | Techdirt | September 16, 2013
In addition to everything else it’s collecting, the NSA also has millions of international credit card transactions stashed away in its databases, according to documents viewed by Spiegel.
The information from the American foreign intelligence agency, acquired by former NSA contractor and whistleblower Edward Snowden, show that the spying is conducted by a branch called “Follow the Money” (FTM). The collected information then flows into the NSA’s own financial databank, called “Tracfin,” which in 2011 contained 180 million records. Some 84 percent of the data is from credit card transactions.
On one hand, what the NSA is doing is exactly what the NSA should be doing: tracing the money flow of terrorist organizations.
Their aim was to gain access to transactions by VISA customers in Europe, the Middle East and Africa, according to one presentation. The goal was to “collect, parse and ingest transactional data for priority credit card associations, focusing on priority geographic regions.”
This is part of the Terrorist Finance Tracking Program, which was set up shortly after the 9/11 attacks and gave the US government access to the SWIFT (Society for Worldwide Interbank Financial Telecommunication) database. This, in and of itself, is not news, having been exposed in 2006. Documents uncovered then showed the program had been in place since 2002, with permission extended to the CIA and the Treasury Dept. as part of Bush’s “Global War on Terror.”
What is new, however, is the fact that the NSA is targeting transactions from major credit card companies, like VISA. This has quite a bit more potential for misuse than SWIFT, which records only banking transactions. VISA responded to this new information with the same quasi-denial we’ve seen from several other companies whose links to the NSA have been exposed.
“We are not aware of any unauthorized access to our network. Visa takes data security seriously and, in response to any attempted intrusion, we would pursue all available remedies to the fullest extent of the law. Further, its Visa’s policy to only provide transaction information in response to a subpoena or other valid legal process.”
Of course, this isn’t “unauthorized” access, not when gathered with a court order or subpoena. But this isn’t as tightly controlled as the spokesperson makes it appear. If pursuing data for “counterterrorism” purposes, the NSA is allowed to skirt the protections of the Right to Financial Privacy Act, thanks to an amendment in the PATRIOT Act. But even with these legal options, it appears the NSA would still rather pursue this in an extralegal fashion in order to circumvent the warrant process.
NSA analysts at an internal conference that year described in detail how they had apparently successfully searched through the US company’s complex transaction network for tapping possibilities.
Whatever’s happening now appears to be the NSA grabbing more data simply because it can. It’s not as if it didn’t already have access copious amounts of financial data, thanks to the government’s fully legal (and fully public) collection of bulk financial records through SWIFT.
Remember: in addition to stealing the data, Treasury also gets it via a now-public agreement. The former CEO of SWIFT Leonard Schrank and former Homeland Security Czar, Juan Zarate actually boasted in July, in response to the earliest Edward Snowden revelations, about how laudable Treasury’s consensual access to the data was.
“The use of the data was legal, limited, targeted, overseen and audited. The program set a gold standard for how to protect the confidential data provided to the government. Treasury legally gained access to large amounts of Swift’s financial-messaging data (which is the banking equivalent of telephone metadata) and eventually explained it to the public at home and abroad.
It could remain a model for how to limit the government’s use of mass amounts of data in a world where access to information is necessary to ensure our security while also protecting privacy and civil liberties.”
Never mind that by the time they wrote this, an EU audit had showed the protections were illusory, in part because the details of actual queries were oral (and therefore the queries weren’t auditable), in part because Treasury was getting bulk data. But there was a legitimate way to get data pertaining to the claimed primary threat at hand, terrorism. And now we know NSA also stole data.
Even when the government has an advantageous agreement to collect bulk data with little oversight, its agencies can’t help but exploit this even further. The collection via “oral queries” is another indicator of these agencies’ (FBI, NSA, CIA) unwillingness to follow even the most minimal of rules. (See also the administration’s 2010 ruling that made the FBI’s warrantless wiretapping legal, which occurred after the agency’s process had slid from issuing tons of National Security Letters to simply calling up the telcos and requesting records.)
The untargeted collection of financial data has raised concerns from those on the “collection” side.
[E]ven intelligence agency employees are somewhat concerned about spying on the world finance system, according to one document from the UK’s intelligence agency GCHQ concerning the legal perspectives on “financial data” and the agency’s own cooperations with the NSA in this area. The collection, storage and sharing of politically sensitive data is a deep invasion of privacy, and involved “bulk data” full of “rich personal information,” much of which “is not about our targets,” the document says.
When even the spies are concerned about about how much data their spy programs are netting, that’s a pretty good sign a bulk records collections effort has gone too far. And it has deeper implications than simply a massive amount of privacy violations. As Marcy Wheeler points out, even the then-Fed chairman Alan Greenspan expressed his concerns about the breadth of the SWIFT collections.
If the world’s financiers were to find out how their sensitive internal data was being used, he acknowledged, it could hurt the stability of the global banking systems.
That’s a scary thought, considering the “global banking system” isn’t all that stable to begin with. A lack of targeting will leave the NSA open to more accusations of economic espionage, something clearly not related to its supposed “national security” agenda.
Related article
SWIFT cuts financial ties with Iran over EU sanctions
Press TV – March 16, 2012
The Society for Worldwide Interbank Financial Telecommunication (SWIFT) says it has decided to discontinue services to Iranian banks which are subject to financial sanctions imposed by the European Union.
“Disconnecting banks is an extraordinary and unprecedented step for SWIFT. It is a direct result of international and multilateral action to intensify financial sanctions against Iran,” the Associated Press quoted SWIFT CEO Lazaro Campos as saying on Thursday.
The Financial Times described the service as “one of the key bits of plumbing in the world’s interbank payment systems,” adding that 30 Iranian banks will be cut off from the service as of Saturday, March 17.
The US and EU charge Iran with pursuing military goals under the cover of its civil nuclear energy program and have imposed several rounds of international and unilateral sanctions against Iran to force the country give up its nuclear energy program.
On January 23, the EU foreign ministers approved new sanctions on Iran’s financial and oil sectors, which ban member countries from importing Iranian crude or dealing with its central bank.
Experts believe that SWIFT’s new action is meant to fully enforce EU sanctions, as global financial transactions are impossible without using SWIFT.
Despite tightening sanctions, some analysts have noted that Iran is still able to skirt the sanctions in a few ways. The country, they say, may exchange oil for cash, gold or other commodities directly. Also, Iranian banks that have not been targeted by EU sanctions can still sell oil.
“Throughout the history of the oil trade, someone always gets around trade embargoes one way or another,” said Jim Ritterbusch, a veteran oil trader and analyst.
SWIFT is a clearing system, which oversees the network used by most of the world’s largest banks to conduct financial wire transfers.
SWIFT handles cross-border payments for more than 10,000 financial institutions and corporations in 210 countries. It enables users to exchange financial information securely and reliably, thereby lowering costs and reducing risks.
Established in 1973, the system has been overseen by major central banks, including the US Federal Reserve and the European Central Bank.
Related articles
- SWIFT financial service cuts Iran off – RT (rt.com)
- India, South Korea increase oil purchases from Iran: IEA (alethonews.wordpress.com)
- Iran sanctions will cause many problems for Italy: Monti (alethonews.wordpress.com)

