Half of the funds transferred from Iraq smuggled

Half of the funds transferred from Iraq smuggled

Posted on August 25, 2012  by  TRC




A prominent Iraqi official disclosed that half of the funds transferred from Iraq abroad since 2004, smuggled money for «life» that the money had not been matched by goods or services or payment for debts and other impact commercial dealings, but could be included within the framework of interest points trafficking as the mafia is linked to several joints within the State and outside. And the legislative and executive branches share charges of smuggling of funds from within the formal framework or so-called money the Central Bank of Iraq for the benefit of its customers of banks and financial companies.

He was Secretary General of the Council of Ministers on relations, acknowledged that five percent of remittances only considered legal, saying that «the amounts smuggled over the years an estimated $ 180 billion, saying «», and that the Government is trying to intensify its control over when the movement of funds, this is not interference in the work of the Central Bank but comes with a view to maintaining public money».

Said: «request from the Central tightening controls on the movement of funds and activation of the Office of the Inspector General, who was appointed Prime Minister, but the Bank refused to direct Office», «Central Bank Governor pledged to take some measures to reduce smuggling currency and control work of banks, but the Government did not touch any results of the procedure and I got things to divert $ 180 billion from Iraq without a document or document conversion or output, especially that amount represents half of the country’s revenues during the past years».

According to the Central Bank, the currency auction since 2004, selling about $ 200 billion to banks and financial transfer companies, daily sales rates ranged between $ 125 million and 200 million in five sessions a week. And dollar prices in exchange for dinar, before the start of the auction mechanisms, Alvin and 400 dinars to the dollar, while the price is currently alpha and 120 dinars to the dollar, the Central Bank also succeeded in reducing inflation rates of 59 percent to less than seven percent in the past nine years.

A bank official said on condition of anonymity for security reasons, in an interview with «life», «remittances abroad and across the Central Bank auction, most of which are not real because it depends on the document are not true while there are no control mechanisms on the movement of remittances». He added: ” as in most States, it is assumed that banks and companies dealing with conversion proof due to conversion: import of goods, or the introduction of mechanisms to implement projects, or fulfilment of previous debt resulting from the services or business dealings». He continued: ” We are not talking here about financial surpluses out investors and businessmen to start their projects or move to out of bounds, but well-drained wealth of the country represented by the hard currency that comes from the sale of oil and not exploited locally but evade».

Asked about the responsibility of the Central Bank said: “the Bank is only technical work and had nothing to do with control over the movement of funds to the follow-up work of the banks, and is unable to follow a particular bank may buy $ 100 million and converted them to abroad, or may enter goods in exchange for those funds. He said such mechanisms is the responsibility of many actors, including the Central Bank and customs, trade and finance, tax, chambers of Commerce and other». The regulatory process or continue the simple comparison between the size of the converted currency, estimated at $ 1 billion per week, and volume of goods against which often not exceeding 10 percent of the amount, meaning that the remaining amount enters from within smuggling».

And their reasons for not detecting smuggling by States tend to money, he stressed that remittances go first ” to certain accounts in banks abroad and there are distributed to client accounts, then turning more than once to give formal and mislead regulators». He stressed that banks that deal with the smuggling of funds is not a command, but smuggling deal in profits, up to about $ 33,000 per million dollars, before the deduction of quotas for the benefit of his traders and banking companies and intermediaries.

The Central Bank’s response

Defended the Central Bank Governor Sinan Al-Shabibi on the Bank in a study prepared by the mechanisms to respond to the remarks of the relationship, I got «life» a copy of them. Al-Shabibi said in the study that the «currency auction is the main source of financing for private sector trade and stabilize exchange rates and to address inflation, growth also contributes to scaling and exporting currency money supply through the purchase of foreign currency available to the Ministry of finance to pay for Iraqi dinar operational budget without the need to issue additional currency increases the size of the money supply and contribute to increased liquidity and raise inflation sizes».

Foreign currency auction

Al-Shabibi said: «these amounts sold in the auction of foreign currency, amounting to about $ 180 billion, was used to import large quantities of goods, raw materials and consumables and pay the salaries of retired Iraqis living outside the country and curative services, travel and tourism, in addition to religious possession of assets for Iraqi citizens living abroad». He stressed that «this is not a money transfers, but funds were smuggled to meet the needs of the Iraqi economy and citizens inside and outside the country. The «restricting conversion or reduction of outer flow of funds out of the citizens is not consistent with the fact that convertible Iraqi dinar, and opposed the article VIII of the IMF agreement which obliges Member States to adopt the free external conversion, except for money laundering operations and the financing of terrorism.

Former Planning Minister Mehdi Al-Hafez, a member of Parliament to study Al-Shabibi said «last allegedly watching inflows and outflows, and here we ask how as we know that there is no closer to these flows», «readability of article VIII of the IMF agreement was hasty and exaggerated, because the article does not impose across-the-Board liberalization of the balance of payments, and does not impose on Member States absolute freedom of capital movements and incomes, on the contrary, the Fund may request from the Member restricting capital movements If the request of the Member assistance from the Fund’s resources.

- See more at: http://www.oneiraqidinar.com/half-of-the-funds-transferred-from-iraq-smuggled/#sthash.dsmUVDw1.dpuf

It looks as if Iraq has laid the groundwork pretty good to be able to claim all that exported Dinar was smuggled! An even more pressing problem might be being able to show that there was legitimate reason for it leaving the country. The questions of "where did you get this" or how did you get this" might be extremely hard to explain when the time comes!

IF the time comes- I have receipts, and proof of purchase, dealer's name, company, all that horseshit, like it would matter anyway, right?

terbo56 wrote:IF the time comes- I have receipts, and proof of purchase, dealer's name, company, all that horseshit, like it would matter anyway, right?

I was talking about people trying to get into Iraq with all that currency, I doubt many Dinar holders would try that but I bet some would! In spite of what the gurus have said I doubt banks will deal with Dinar, however I suppose IF there was enough profit to be realized and IF Iraq would willingly take them back then the banks MIGHT be willing to act as an intermediary for exchange. For sure if the dealers are the only means of getting them back, IF they even can do it, they will want rip-off spreads, although personally I think when this falls apart the dealers will disappear like cockroaches when the lights are turned on!

I hear that- But even IF we got a dollar, that's nothing to sneeze at, it's more than what we paid to begin with- I'd be happy with a dollar, but, like you say, I think it will fall apart long before that happens-Am I correct in thinking that?

Well if the impossible happened and Iraq could somehow become wealthier than all the countries on the planet combined, which a Dollar would make them, then most likely Banks, dealers, etc would all be scrambling to arrange an exchange -but let's face it that's simply not going to happen. I was talking about exchanging at the current rate if and when this thing falls apart, or maybe at a more realistic rate of a few percentage points like actually sometimes happens in the real world. That's what I meant when I said IF the banks could see a profit but rate increases in the realm of possibility would not even cover the spreads that most folks have in their Dinars, the profit for the banks I was talking about would be a few percentage points above the current exchange and it would have to be quite a big increase at that to get them interested considering the pitfalls of this whole mess.