e-gold Closes All Iranian Accounts

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Mon, Dec 4 - 2:28 pm EDT | 8 years ago by
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…why has a digital currency such as e-gold, cut all operations with Iran? If they are not a bank, a Money Transfer Service or even considered at this time to be a ‘currency’ of legal type?

G&SRAccording to e-goldstrong.com Gold & Silver Reserve (G&SR), Inc suspended all Iranian held accounts back on 24 November 2006 without any notification. This was a surprise move to some e-gold followers and definitely a big surprise to the Iranian e-gold account holders !! There was no notice or news posted on the e-gold web disclosing ‘why’ they closed the accounts.

One Iranian e-gold holder of a closed account published this email stating he had received it from the e-gold service department (we have no confirmation from e-gold on this or any notice).

This is their answer : Your account has been frozen in compliance with the laws which govern e-gold, Ltd. and its managers. e-gold, Ltd. has taken this step in strict compliance with the law. No further information is available at this time. When additional information is available it will be provided upon account login.

Thank you,
Service 2

On December 3rd, in the Business Section of the The Independent, a UK publication, Andrew Murray-Watson wrote an insightful article. It describes, how, ‘right-now-this-week’, the US is telling all UK banks with US subsidiaries to shut down Iran operations. It is believed that several of the larger UK banks such as RBS, HSBC and others which maintain operations across the pond have already shut down operations on behalf of customers in Iran.

A spokeswoman for the US Treasury Department confirmed that meetings had taken place with senior UK bankers. However, she stressed that the talks had been set up so that US government officials could “equip banks with information” about the dangers of allowing Iran to remain part of the international financial community. The US has imposed unilateral sanctions on Iran – because of its alleged support for international terrorism – and individuals found to have breached the economic restrictions face a fine of up to $250,000 (£126,000) and 20 years in jail.

[are you now getting the picture why e-gold dropped Iran]

It is also known that Barclays has already stopped taking any deposits on corporate accounts in transactions originating from Iran. UK banks with US operations are very concerned at facing legislative or legal troubles if they don’t stop acting on behalf of UK business customers in Iran.

Like the brief response quoted above which we believe came from e-gold’s service department, the UK banks aren’t telling the press they were given a specific reason to halt the Iran banking connection.

An AIM-listed finance director with significant operations in Iran said: “Barclays told us that it is unable to act as our bank as far as Iran is concerned. We have not been told why.” HSBC has said it will no longer accept dollar transactions from within Iran, while RBS declined to comment. A top exec at on of these banks said: “The consequences of not toeing the American line on Iran have not been made clear, but we were left in no doubt that we might not want to find out.”

Although these are UK banks and listed UK corporations, they all have substantial operations in the US, which leaves the door open to their assets and potentially vulnerable to any US action.

But why has a digital currency such as e-gold, cut all operations with Iran? If they are not a bank, a Money Transfer Service or even considered at this time to be a ‘currency’ of legal type?

The answer is simple but very serious and may be reflected in these two recent reports:

(1) FAFT’s New Payment Methods Report which by the way was published just three weeks (Nov. 2) before the Iranian e-gold accounts were halted.

The FAFT’s Report specific text is quoted below:

Digital Precious Metals

…….Typology. Digital precious metals offer the potential for anonymous cross-border funds transfers. The risk is greatest when the service provider operates offshore in a jurisdiction with a weak anti-money laundering and counter terrorist financing regime. Even when CDD is envisaged, where the customer relationship exists entirely online, the extent to which service providers attempt to verify customer identification determines the ML/TF risk relative to the other risk criteria and risk mitigation efforts.

  1. ML = Money Laundering
  2. TF = Terrorist Financing

(2) Study of New U.S. Unilateral Sanctions, 1997-2006 by Michael P. Malloy commissioned by the National Foreign Trade Council (NFTC). The new report reveals that from 2001 to 2006, the imposition of sanctions against individuals and non-governmental organizations increased, generally as a response to heightened concerns about the threat of terrorism. As quoted from the report.

List of Current U.S. Unilateral Sanctions For Iran

  • Antiterrorism and Effective Death Penalty Act of 1996
  • Arms Export Control Act
  • Consolidated Appropriations Resolution, 2003
  • Consolidated Appropriations Act, 2004
  • Defense Authorization Act, 1996
  • Department of Defense Appropriations Act, 1987
  • Export-Import Bank Act
  • Foreign Assistance Act
  • Foreign Relations Authorization Act for 1994 and 1995
  • Foreign Operations, Export Financing, and Related Programs Appropriations Act, 1996 & 1998
  • Foreign Operations, Export Financing, and Related Programs Appropriations Act, 2002
  • Foreign Operations, Export Financing, and Related Programs Appropriations Act, 2006
  • Internal Revenue Code
  • International Emergency Economic Powers Act
  • International Security and Development Cooperation Act of 1985
  • Iran and Libya Sanctions Act of 1996
  • Iran and Syria Nonproliferation Act
  • Iran-Iraq Arms Non-Proliferation Act of 1992 (excepting humanitarian assistance and supplies
  • per Narcotics Control Trade Act (removed by EO in 1999)
  • National Defense Authorization Act for 1990-91
  • National Emergencies Act
  • Omnibus Appropriations Act, 1997
  • Supplemental Appropriations–FY 2003)

It would appear, that ANY type of financial connection with Iran via the US at this time is a severe ‘no no’. It also appears that even (perhaps?) in advance of being asked, e-gold Ltd, may already be complying with the US governments regs….or perhaps they got the same explanation from the Treasury Department as the UK bankers?

As listed above, if you are in the United States, at this time there are a good number of reasons and restrictions on any type of business with Iran, especially financial.

e-goldWhile their ‘reasons why’ may always remain unknown to us the general public, it looks like, e-gold made the smart move. Thumbs up mates.

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  • hadis

    I can not believe this!This is incredible.Why?for which reason E-Gold company do this with Iranian opeator.I am MS.CIranian student and PTC is only way for continue my education.You know in Iran education chargin is so high,especially in Azad university. I dont know that what am I doing with this freze account?

  • steve

    Hi Hadis,

    It is not the fault of E-Gold. As you can see, E-Gold is under pressure by the U.S. Government’s Department of Justice.

    The mistake of E-Gold is that they should have incorporated and maintained their “total and complete” operation outside the jurisdiction of the U.S. government.


  • saeed

    i am iranian. i have account.

  • Hossein

    E-gold has frozen our accounts without any reason.
    When we ask for our money, e-gold does not respond at all.
    I will call it fraud, e-gold has defrauded many of it’s Iranian account holders.
    To whom that think all Iranian account holders are running Ponzi and scam schemes, you are wrong.
    You still can find legit account holders that do clean and legal business.
    The sanctions are not against individuals and e-gold should send back the funds to the owners.


  • wahid

    Dear sir

    Its Fraud, Abuse, or Misconduct

    I lost $1000.00 USD at e-Gold LTD (internet payment) https://e-gold.com

    my account number:3273936

    now, after 2 month. i saw e-gold.com changed my account password and remove my account and don’t answer to my emails…

    you can see my account link at e-gold.com internet payment:

    Error(s) detected:

    The PAYEE_ACCOUNT specified is not a valid account: 3273936
    account neme: Unknown

    after it, i search about e-gold.com at any web search, i saw its scamming any members without any reason

    I create an mail and send it to a few news sites such: sec.gov , bbc.com , cnn.com , International Crime News , usdoj.gov , federal gov , news.com , CNET , e-Gold host data center and …

    now, i lost $1000.00 USD at this on-line payment method, and need to your help for make free my account and get it.

    thank you for answer
    i hope back my money, because i need to it at hard life

    have a nice time

    my phone: +1(213)7845129

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  • farhad.s.moqadam

    this maner of fact is harmful for two side
    first for iranians then for e-gold…
    it is better to find an other way to solve this problem.we are living at same planet!

  • http://www.zemanat.com Hassan Karimi

    Mark on December 4th, 2006
    now May, 10, 2008 and still all Iranian accounts are blocked, dont wait for egold response anymore!
    millions of dollars from thousands of Iranians scammed by e-gold!

  • Dan

    As long as they comply with US law, they’re going to violate human rights on every front. A shame, I was just starting to take interest.

    At some point a law will come into effect requiring them to send all their gold to the US treasury with no compensation. Happened in the 1930′s once already.

    Maybe if someone were to offer an almost identical system with full 3rd party audits and without the US mafia having control, I’ll convert currency.

  • Chris

    So E-gold essentially stole the gold held by these people? Isn’t that against their own guarantees and contract, the exact thing that they claim can’t happen?

    It would seem to be the right time for a lawsuit to settle the issue of who “owns” the E-gold gold…