The Central Bank of Iraq has issued guidance to all licensed banks and licensed nonbank financial institutions on implementing targeted financial sanctions without delay. The guidance also covers other financial institutions, designated nonfinancial businesses and professions, nongovernmental organizations and relevant implementing authorities. It defines action without delay as freezing funds or other assets within 24 hours of a listing decision by a United Nations sanctions committee or Iraq’s Terrorist Funds Freezing Committee. The measure follows the central bank’s July workshop on the same controls, which formed part of work associated with Iraq’s Financial Action Task Force action plan. Covered entities must maintain updated sanctions lists and screen customers, beneficial owners and connected parties before establishing a relationship or providing a service, with periodic screening thereafter. A confirmed match requires immediate freezing without awaiting further action, prevention of any direct or indirect access to funds, economic resources or services, and reporting to the Terrorist Funds Freezing Committee with a copy to the Anti-Money Laundering and Counter-Terrorist Financing Office. Entities must document screening and match decisions, avoid tipping off affected parties, designate responsible officers and ensure electronic screening systems account for aliases, spelling variations and Arabic and foreign-language names. Senior management must provide the policies, systems and resources needed for compliance, while covered entities must review their internal procedures against the guidance. Supervisors will assess controls including list updates, screening effectiveness, freezing speed, reporting, recordkeeping and training. Noncompliance is subject to the legal procedures and penalties under Iraq’s anti-money laundering and counter-terrorist financing framework.
2026-09-20Central Bank of Iraq
Central Bank of Iraq issues guidance on implementing targeted financial sanctions within 24 hours
The Central Bank of Iraq has issued guidance requiring covered entities to implement targeted financial sanctions without delay, defined as freezing funds or other assets within 24 hours of a relevant listing decision. Firms must screen customers, beneficial owners and connected parties, freeze confirmed matches immediately, prevent access to funds or services and report the action without tipping off affected parties. They must also review internal policies, screening systems, governance, records and training against the guidance.