Last week, the Financial Action Task Force (FATF) – an intergovernmental body that sets and promotes standards for combating money laundering and terrorist financing – issued a new public statement that suspended its call for Member-States and other jurisdictions to impose counter-measures against Iran for deficiencies in its AML/CFT regime.

FATF’s decision to suspend its call for counter-measures against Iran was in recognition of the positive steps that Iran has recently taken to address the persistent deficiencies in its AML/CFT regime and following Iran’s “high-level political commitment” to an Action Plan with the FATF. Iran is expected to complete the steps required in the Action Plan within a 12-month period, at which point FATF will consider further steps, including rescission of Iran’s designation as a “high-risk jurisdiction.”

To do this, though, Iran will require certain technical expertise with which it has so far lacked, as Iran has no experience implementing and enforcing a rigorous AML/CFT regime. FATF’s public statement signals that Iran itself understands this fact, stating: “The FATF welcomes…[Iran’s] decision to seek technical assistance in the implementation of the Action Plan.” What could this mean for recent proposals, such as the one here, for the U.S. government to facilitate Iran’s procurement of such technical expertise to implement its FATF Action Plan and thus strengthen its AML/CFT regime?

Frankly, I think a license authorization is possible. Certainly, the U.S. Department of the Treasury’s Office of Foreign Assets Control would (or should) entertain specific license applications for persons seeking to provide the technical expertise required for Iran to come into compliance with global banking norms. The policy arguments for such a license application would be obvious, insofar as it is clearly within U.S. foreign policy interests for Iran and its financial institutions to adopt and enforce a rigorous AML/CFT regime meeting globally-recognized standards. The U.S.’s involvement with FATF over the past decade vis-à-vis Iran demonstrates this very fact.

But the issuance of a general license authorization is also a distinct possibility. Recall that the Iranian Transactions and Sanctions Regulations (“ITSR”), 31 C.F.R. Part 560, does contain license authorization for the provision of certain legal services at 31 C.F.R. § 560.525, including the provision of legal advice and counseling to the Government of Iran, Iranian financial institutions, or persons in Iran regarding the requirements of and compliance with the laws of the United States or any jurisdiction within the United States, provided that such advice and counseling is not provided to facilitate transactions in violation of the ITSR.

Clearly, the provision of technical advice to Iran regarding its FATF Action Plan would not fall within the scope of this  license authorization, but OFAC could issue a general license that treads a similar path – albeit relating to compliance with FATF recommendations as opposed to U.S. sanctions laws. OFAC could also caveat its license in such a manner to ensure that such technical expertise was not utilized in a such a way as to run contrary to U.S. interests. Moreover, as with 31 C.F.R. § 560.525, OFAC could require that receipt of payment for the provision of such technical expertise be specifically licensed not just to ensure that payment does not originate from blocked sources, but also to better understand the manner in which the general license is being utilized.

Considering the fact that the United States is the standard-bearer when it comes to AML/CFT compliance, the Obama administration has a distinct interest in seeing U.S. persons provide the requisite technical advice to Iran. Of course, the provision of technical advice could happen at an inter-governmental level, but if the process is limited to that, then the process will also be a much more slow-moving one. It is unlikely that Iran could implement and enforce a rigorous AML/CFT regime within the given time-frame if the provision of technical advice is limited to such an intergovernmental level. The U.S. government should thus consider steps to provide license authorization for U.S. technical experts to do some of the lifting as well. Frankly, I would surprised if OFAC isn’t already on their way to doing so.