Iraq bans US dollar transactions on 8 local commercial banks. The Iraqi government said the move was aimed at reducing fraud, money laundering and other illicit use of US currency.
Banks are also barred from dealing dollars in Iraq’s central bank. A list of banks banned by the Iraqi government includes Ahsur International Bank for Investment, Iraq Investment Bank, Iraq Union Bank, Kurdistan International Islamic Bank for Investment and Development, Al Huda Bank, Al Janub Islamic Bank for Investment and Finance, Arabia Islamic Bank and Hammurabi Commercial Bank.
“We took this step to protect the Iraqi financial system from abuse,” said a Treasury spokesman, who spoke on condition of anonymity.
In July 2023, the Iraqi banking system banned 14 banks from handling dollars as part of a crackdown on dollar smuggling to Iran. However, experts believe that Iraq has made this decision in response to the current situation with the United States.
The Central Bank of Iraq said in a statement that banks banned from dealing in dollars will be able to carry out the rest of their operations. Besides, other currencies other than US dollar can be transacted.
Brian Nelson, the top US Treasury Department official, met with top Iraqi officials in Baghdad last week. The meeting discussed how to protect the Iraqi and international financial system from criminal, corrupt and terrorist actors.
