Islamic Republic of IRAN’s Country Report: Evaluation Of Current Situation Of Money Laundering 10th ASOSAI Research Project (AUDIT TO DETECT FRAUD AND CORRUPTION) “Evaluation of the fight against corruption and money laundering” By: Mahdi Rezaei Represented of Iran

This Presentation, Concludes: Introduction Updates on the role of SAI Iran in the 10th ASOSAI Research Project S.A.I’s status in combating money laundering Gained Results from Evaluation of Current Situation of Money Laundering in Iran.

Having returned back from the 1st meeting of the 10th ASOSAI Research Project in Shenzen, China, we witnessed very good interaction among research project members including Chinese, Malaysian, Thai and other colleagues from project members.

In the Supreme Audit Court of Iran the project is led by Mr. Javad Naserain, Principal Auditor. Based on the initiative of Mr. Naserian, a working team was established consisting of the auditors and expert involved with audits of money laundering and corruption. Considering the approved framework for action in the 1st meeting of the 10th ASOSAI Research Project, the same team started to contact the relevant Iranian institutions and organizations involved with the fight against corruption and money laundering.

The result of the interaction with the authorities of the above organizations was led to the preparation of the first proposed questionnaire which was sent to CNAO and the subgroup one on 13 Feb

On 10 March 2013, the final questionnaire on corruption and money laundering was received by the working team in SAI Iran. It was sent to the Centre for Fight against Money Laundering at the Ministry of Economic Affairs and Finance. The same questionnaire was completed by the experts from the above mentioned Center. SAI Iran submitted the completed questionnaire to Head of subgroup one and the Head of the Project on 27 March 2013.

IRIFIU. Ministry of Economic Affairs and Finance, Centre for Fight against Money Laundering 1. the situation of money laundering in Iran, is Serious. 2. Money laundering tends to decrease in recent years. 3. Over the years, money laundering tends to be more sophisticated.

4. The main pattern of money laundering, observed in Iran, is in public and private entities. 5. Fields have the highest risk of money laundering: A)Finance, banking, B) Real estate, C) Trade and D) Construction. 6. the most common method of money laundering: A) Through financial institutions, B) Money exchange, C) Cash transaction and D) Real estate

7. environments favorable for money laundering: Bank and financial institutions do not have suitable supervision/control system to anti money laundering and Use of cash and illegal money transfer is dominant. 8. Top offences closely associated with money laundering: Drugs and Production, buying and selling of illegal goods.

9. The main reasons that criminals launder money: Becoming legitimate and Hiding illegally accumulated wealth. 10. The consequences of money laundering: Negative impact on foreign investment and Reduced government tax revenue and weakened government control over the economy.

11. The economic and social consequences that money laundering has caused, is Extremely serious. 12. money laundering impact negatively on national security, international reputation and weaken the economy.

With regard to the related laws and regulations, available infrastructure, operational FIU (Financial Intelligence Unit), receive and analyze and dissemination of STRs (Suspicious Transaction Reports) and CTRs (Covered Transaction Reports) to competent authority, we should say that the situation of Iran in fight against money laundering is being improved.

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