The Central Bank of Iraq reveals the reason for America imposing sanctions on Al-Huda Bank

The US Treasury Department placed sanctions on the Iraqi “Al-Huda” Bank, which the Central Bank of Iraq disclosed on Tuesday. The bank attributed the penalties to the bank’s operations in 2022.

The Central Bank of Iraq stressed in a statement released today that it continued to offer its banking services without dealing in US dollars and that it was permitted to deal in other foreign currencies. The bank did not take part in the foreign exchange buying and selling window during the year 2023.

Due to its “acting as a channel for financing terrorism by Iran,” the Iraqi Al-Huda Bank is a key source of worry about money laundering and was added to the US Treasury Department’s list of sanctions yesterday, Monday.

Al-Huda Bank, an Iraqi bank that serves as a conduit for funding terrorists, as a foreign financial institution raises serious concerns about money laundering, according to a US Treasury statement seen by, which also noted that “the Financial Crimes Enforcement Network (FinCEN) proposed a rule.” The Office of Foreign Assets Control (OFAC) would impose sanctions on the bank’s owner in addition to forbidding local financial institutions and agencies from opening or maintaining a correspondent account for or on behalf of Al Huda Bank. This would effectively isolate the bank from the US financial system.

Treasury claims that Al-Huda Bank and its foreign backers, such as Iran and its proxies, are siphoning off money that would have supported the lawful enterprises and economic ambitions of the Iraqi people. These ill-advised parties are also inciting violence that endangers the stability of Iraq and the lives of both American and Iraqi citizens.

The US Treasury statement claims that Al-Huda Bank has been using US cash it has access to, for years, to fund foreign terrorist organizations that are labeled as such, such as the Iranian Revolutionary Guard and Iraqi militia groups that are affiliated with Iran, such as Kataib Hezbollah and Asaib Ahl al-Haq.

The Chairman of Al-Huda Bank’s Board of Directors is complicit in Al-Huda Bank’s illicit financial activities, including money laundering through front companies that conceal the true identities of the parties involved in the illicit transactions, which ultimately facilitates the financing of terrorism, according to the statement.