ANZ refuses Iran transfer to Solomons

Campbell Cooney

Last Updated: Tue, 17 Nov 2009 18:12:00 +1100

The ANZ bank has refused to process a $U100,000 transfer from Iran to Solomon Islands, that was to pay the travel costs of 25 Solomon Island students bound for medical training in Cuba.

ANZ bank says it was complying with United Nations trade sanctions in refusing the transaction.

However, the Solomon Islands High Commissioner to Australia, Victor Ngele says the UN sanctions do not cover offers of assistance from Iran, and the bank's move was a "corporate decision".

"The decisions taken by ANZ Bank were purely corporate decisions and it has nothing to do with the Australian Government as such, because Australia does not impose (an) embargo on Iranian funds," he said.

Iran's agreement to pay for the students' travel is the result of an agreement reached late last year to form closer ties with Solomon Islands, and particularly for the Pacific nation to access Iran's expertise in civil engineering.

Iran's agreement to pay for the students' travel is the result of an agreement reached late last year to form closer ties with Solomon Islands, and particularly for the Pacific nation to access Iran's expertise in civil engineering.

The money was to be sent through the ANZ branch in Honiara, but the transfer was rejected.

Taking no chances

In a statement, the ANZ said it does not process remittances or transactions, "in any currency, directly or indirectly, involving Iran, Sudan, Syria, North Korea, Myanmar or Cuba."

"The policy is intended not only to ensure ANZ complies with all relevant international sanctions but reflects a belt and braces approach given the unacceptable risk of sanctions non-compliance and the gravity of consequences associated with non-compliance," the statement said.

The consequences are significant, and expensive.

In August the ANZ reached an agreement with the US Department of the Treasury's Office of Foreign Assets Control (OFAC) concerning 31 trade finance transactions conducted between 2004 and 2006 involving parties in Sudan and Cuba.

The ANZ says the transactions were not breaches of Australian law, or Australian or United Nations economic sanctions, but as part of its agreement, it paid nearly $US6 million to settle the alleged violations of US economic sanctions.

Working on alternatives

Mr Ngele says the Solomon Islands Government now is working on what to do about the medical students.

"We do have 50 students in Cuba now. We are sending another 25, so it appears to me that we are sending 25 students annually to Cuba to do medical studies," he said.

"I don't underestimate our own capacity to fund our own students' travel, but this is a situation where under the cooperation between us and Iran, signed by our Foreign Minister and his counterpart, the assistance was utilised."

Israel visit

The withholding of the Iranian money has coincided with a visit to Solomon Islands by Israel's Deputy Ambassador Gili Sharir, who is also the Deputy Director of the Pacific Department, within Israel's Ministry of Foreign Affairs.

The visit's main purpose is get an explanation from Solomon Islands' Government about why it was the only Oceania country that voted in support of the Goldstone Report, which is highly critical of Israel's assault on Gaza last year, and which in turn has been attacked by Israel and its supporters around the world.

Mr Ngele says his country decides its own position on international issues.

"Solomon Islands is a sovereign country, and it has the right to make its own decisions," he said.