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Iraqi Dinar Report Counterfeiting Iraq Currency

 

Iraqi dinar being Counterfeited
American Contractor Iraq Report 01/08/2017

Criminal gangs counterfeiting the Iraqi dinar currency

While the Iraqi Army is continuing their ongoing battle in the city of Mosul, the Iraq Economic and Investment Commission Parliament members received disappointing news of heightened incidents of counterfeit Iraqi dinar currency. Shopkeepers at the local Baghdad market, outside the International Zone (formerly the green zone), were angered at receiving counterfeit 5,000 and 10,000 Iraqi dinar currency banknotes. There have been frequent reports that there are mafia groups and criminal gangs operating within the Baghdad area who are counterfeiting the Iraqi dinar currency. The criminal gangs are mostly concentrating on the 5,000 and 10,000 IQD banknotes due in part to them being easier to counterfeit than say the 25,000 IQD banknote. The Director of the Central Bank did not appear flustered or too concerned about the report of counterfeit dinars floating around. The CBI just swiftly replaced all counterfeit banknotes turned in by the shopkeepers. The parliament members from the Economic and Investment Commission sent an emergency Memorandum to the Central Bank and summoned the bank’s Director. Prior to the meeting, the CBI Director had been tipped off on the meeting’s agenda and issues.

The senior ranking member of the Iraqi Economic and Investment Commission is a woman by the name of, Najiba Najib. This is the very same woman that I have spoken about in prior articles. She has full authority on matters related to the Iraqi dinar currency. This woman is single handedly responsible for halting the delete the zeros project in 2014. How influential is this woman? Najiba Najib is so powerful, that on any given day she could randomly announce “today we increase the value of the Iraqi dinar currency”. That’s the power Najib possesses. Currently, insider reports are leaking that there is much friction between Najiba and the Director of the CBI. The reason being is that Najib wants to delay the launch of deleting the zeros project that the Central Bank so adamantly wants. Najib is insisting that they wait until year 2018 or 2019.

Private Iraqi banks refuse to give depositors their money

Iraqi citizens are going to the banks and are demanding the withdrawal of their deposited funds. The problem is that the private banks have no liquidity, no money and are refusing to return the depositors money.

Central Bank places five banks in receivership

In Iraq the Iraqi Central Bank has the authority and the oversight to shut down any bank in the country. If the bank is not in compliance with CBI banking laws it would have the option to shut down any private, State, and Islamic bank. The CBI has shut down and has complete oversight of the following five Iraqi banks (see below). These are the same banks that the depositors are having difficulty withdrawing their deposits from. When you’re in receivership the CBI has complete control of your bank and bank books. The CBI has recommended that these banks either liquidate or merge with other banking institutions. The problem with merging is that most of these banks are family owned and refuse to merge with another bank for fear of losing control of their private Iraqi bank.

Dar Essalaam Investment Bank

North Bank for Financial & Investment

Economy Bank for Investment & Finance

Al-Warka Bank

Basra International Bank for Investment

In the past, the Central Bank has wanted Iraqi banks to increase their operating capital, which most of the banks did. The banking services of Iraqi banks are not up to the standards of the 21st century. With the increase of banks in Iraq you would think that this would entice Iraqi citizens would want to open up bank accounts. Unfortunately, Iraqi citizens have no confidence in the system and until the banks offer more services it will remain the same in 2017. In addition, the banks are not offering any small loans or additional banking services. Most banks are making their profits on the currency exchange transactions, and for this reason the CBI will continue with the daily currency auctions.

Central Bank Daily Auctions

The Central bank conducts a daily auction of selling U.S. dollars for the Iraqi dinar currency. The Central Bank sells hundreds of millions of dollars each day to private banks and authorized currency exchange centers. The CBI does so much business that it generated $33 billion dollars in 2016. In fact, there are several Iraqi banks that do not provide any service but currency exchange. If and when the CBI halts the currency auctions, the banks that depend on the currency auctions would more than likely go out of business. The banks are going to the daily auctions and conducting the transaction for hard currency (USD) and it’s being smuggled abroad.

The terrorist take control of Iraqi banks

In June 2014, when the terrorists invaded and moved swiftly into northern Iraq taking full control of the major cities in Anbar province, they took immediate control of all the banks in the providence. This impacted the banking institutions in Iraq as they watched the terrorists remove all of the Iraqi dinar and U.S. dollars that were stored inside the bank vaults.

Central Bank re-opening branches in Erbil and Sulaymaniyah

Three years ago, the CBI shut down their bank branches in the city of Erbil and Sulaymaniyah. The Kurdistan Regional Government (KRG) decided that they would take control of their own finances when it comes to the KRG government. The KRG has a billion dollars in deficits. Recently, CBI has decided to re-open the CBI branches in those two cities to assist the KRG with their finances and obtaining funds to their governments.

In Iraq E-Commerce still in the distant future

Internet in Iraq is available, however, it is very expensive. A recent article falsely reported that there is an electronic payment system in Iraq, just like in the United States or anywhere else outside of Iraq. The truth of the matter is, that there is no electronic payment system that is available to anyone in Iraq for the sale of goods and/or services. It is still a cash society. Most vendors must buy their materials and products upfront with the seller, who often are outside of Iraq. The materials or products are transported by truck over the Iraq borders or are shipped by boats to the port.

Real Estate prices in Iraq down 40%

In Iraq, there is a massive shortage of first time home buyers/owners. Traveling throughout Iraq one will often see unoccupied homes with no one living in them. Many times the construction has not been completed. In fact, there are numerous construction projects that are either not completed or partially completed. The money and funds have all dried up. On the rare occasions that banks are agreeing to loans they are only lending out about 50 million Iraqi dinar per person or family. Unfortunately, this is not sufficient enough to purchase a nice apartment in the Baghdad area. The families are accepting the loans and buying very inexpensive small RV type vehicles and making their homes in them. The recent Iraqi government budget for 2017 shows no available funds for loans to the public. Iraqi landowners have drastically dropped the prices to entice buying but no one is buying anything. Interestingly, private banks in Iraq are the largest landowners in the country. The banks have now decided to hold onto the deeds in hopes of the economy returning to prior conditions where things were flourishing.    Source


1/1/2017 There has been an interesting article published in the Middle East media. The Central Bank of Iraq has warned the private Iraqi banks to give depositors their funds when they ask for it from the Iraqi banks. The Iraqi private banks have not been cooperating with their bank's depositors who on a daily basis have been wanting their deposits back.

If I had funds inside a private bank, I would pay attention to this story. Let's hope that the Central Bank takes all these private Iraqi banks that are not cooperating with their depositors to court and the people get their money back.
Will keep you informed on what is going on in Iraq.

Want to learn more watch the video below.

1/1/2017 Central Bank of Iraq to put Private Banks on Notice

The Banking Industry in Iraq

DECEMBER 31, 2016 BY AMERICAN CONTRACTOR

The Banking Industry in Iraq How to receive More US dollars and bypass currency restrictions

The Iraqi private banks are still in limbo. They continue to operate with limited funds even after the Central Bank of Iraq (CBI) directed all private banks to increase their operating capitals from the previous June 2016. An Iraqi Parliament member from the Economy and Investment commission recently stated that the Iraqi private banks are operating the dollar auctions with forged invoices to import foreign commodities.

The private Iraq banks have limits that are imposed by the CBI each day in regards to foreign currency exchange. How the Iraqi banks get around this is called Letters of Credit (LC) and that allows the Iraqi banks to exchange Iraqi dinar (IQD) for foreign currency (primarily U.S. dollars.)

I’ll give you a brief explanation on what happens when a private bank wants to increase their dollar exchange beyond the CBI recommendations. Here’s a scenario; you have an Iraqi businessman that is buying materials from an Iranian manufacturer who wants to be paid in U.S. dollars, this Iraqi businessman will likely need to visit an Iraqi bank to complete the transaction. The Iraqi bank receives the documents from the Iraqi businessman detailing the purchase of say, one million dollars of materials that happens to be located in Iran. The Iraqi dinar (IQD) currency that is equaled to one million dollars is deposited inside the Iraqi bank. The Iraqi bank representative travels to the nearest Central bank currency exchange and gives the documents to the CBI representative detailing the business transaction. The Iraqi bank representative then receives the US dollars and returns back to his Iraq bank. One might think that this is all legit and that the Iraqi bank probably does this several times a day (assists Iraqi businessman.) After all, the assumption is that this is what a bank does in Iraq, to assist businessman in acquiring funds for their construction projects. The only problem is, the Iraqi businessman gave fraudulent documents to the Iraqi bank. There are no materials in Iran that he intends to purchase. It’s all a fraud and many times it’s done with full knowledge of the Iraqi bank. This is how the Iraqi banks and many foreign exchange services get around the daily limits of foreign exchange. In addition, they sometimes offer business documents to start the process of foreign currency exchange. This is just another way the banks acquire more U.S. dollars and then they turn around and sell at a higher price. The banks buy the USD at a low price and then sell the USD to the businessman or the public at a higher price.  source


Iraq Central Bank May Print 200k Iraqi Dinar Banknote in 2017 / Iraq Information Update  December 03, 2016

Things in Iraq are going as well as can expected in light of the happenings there. All considering that the Iraqi government has been at war with the Islamic State of Iraq and the Levant (ISIL) since June 2014. Things appear to be looking up for Iraq as the Iraqi Security Forces (ISF) have surrounded the city of Mosul and are currently cutting off all escape routes for the ISIL terrorists. The Iraq Counter-Terrorism Forces (CTF), (or better known as the Golden Division) are continuing on with their fight with the ISIL terrorist in Mosul. They have advanced into three Mosul neighborhoods.[1] The Iraqi security Forces (ISF) have almost secured the Mosul-Kirkuk highway as ISIL has been using this stretch of road as an escape route.[2] ISF will soon secure the highway and transport materials to Mosul to help in the war effort. The ISF is now in control of seven neighborhoods southeast of Mosul in the Muharabin and Intisar areas. The ISF is still continuing to be attacked by ISIL snipers that are camouflaged along the highways and buildings. According to an ISF commander, ISIL still has the ability to manufacture car bombs and send them to attack Iraqi army bases. On Saturday, (Nov 26) ISIL launched eight car bombs against Iraqi army bases.

Economy in Iraq

In Iraq, the private banking system continues to work at minimum modern day banking standards. The banking system is underdeveloped and is a cash based system the majority of the time. Very few banks issue bank credit cards, wire money, issue loans and/or make deposits. Commercial lending has risen to higher levels, however not to a level that brings confidence to the local Iraqi wanting to start a business. Not to mention, there continues to be too many restrictive conditions that make it difficult for the average Iraqi to obtain a bank loan. Most loans currently given in Iraq are negotiated within or by family members and close friends, and most are like $10,000 or less.

As far as the private banks go, they are loaning higher amounts however the borrower must have collateral and the only collateral that a bank will accept is land. It is the reason Iraq banks in Iraq are the largest land owners. They really should consider going into the real estate business.  Banks in Iraq are making their profits by small loans with collateral which would be land and money transfers. Western Union is available in Iraq for money transfers however, the fees are higher than if you walked into a private Iraq bank. The Iraq state banks do not transfer money for citizens only for government business only.

The Iraq Central Bank (CBI) has decided to continue with the delete the zeros project or better known in the financial circles in Baghdad as the redenomination of the Iraqi dinar currency. Meetings and conferences are usually held in Baghdad or in areas where the ISIL terrorist group are not. The CBI has started printing the 50,000 (50k) Iraqi dinar currency banknote and will print the 100,000 (100k) Iraqi dinar currency banknote shortly thereafter. The printing of the 100k has not yet started, and talks continue on about printing a 200k banknote. You may also find it surprising that the low denominations currently in circulation will be removed from Iraq. That announcement is expected to come later in the year. Iraq government officials would like to see the country increase the oil production before any serious work on the Iraqi currency is completed. The redenomination is the start of the successful macroeconomic stabilization and will not alter the value of the Iraqi dinar currency.[3] Currently, the economy has not stabilized itself enough as prior to June 2014, when terrorists moved with speed in northern Iraq. Several years ago, the Central Bank shut down all economic ties to the Iraq cities of Erbil and Sulymaniah in northern Iraq. It was done because the Kurdistan government wanted full control of its finances without any kind of oversight from the CBI. Hopefully, within time, the CBI and the Kurdistan government will open the Erbil CBI branch and get their banking activity Kickstarted once again.

The Central Bank of Iraq

The Financial Advisor to Iraq, Prime Minister, Mohammed Saleh has recently said that there is a legitimate concern for bankruptcy because of an increase in the government pensions since 2003.[5] The Iraqi government applied for a loan from the IMF (International Monetary Fund) and the loan came with stipulations. For one, the IMF would like the Iraqi government to reduce the salaries paid to retired government employees. The IMF has not stated what the ramifications would be if the Government of Iraq did not comply with these terms.      sources

Iraqi Private Banks bankrupt and still Corrupt

5/8/2016 IQD Devaluation IMF Says
 

Jan 3 2016 / Iraq moving forward in 2016

Al Warka Bank Iraq Starting New Operations Jan 2016

Iraq Central Bank approves Mobile Wallet

April 16, 2015 Iraqi Banker Gives Clue About IQD higher Denominations

Iraq may Issue Bonds in 2016

12/26/2015 New 50k Banknote in Circulation in Iraq

American Contractor Live Twitter Feed
 

12/26/2015 Iraqi Dinar devaluation Says Emirates NBD Report

12/27/15 Central Bank Iraq Talked About Devaluation August 2015

 

In December 2014, I reported on the problem of the oil agreement between the Baghdad central government and the Kurdistan Regional Government (KRG). The KRG is expecting the monthly payment of 1 billion dollars from the Baghdad government to help pay for public employee salaries and other priority projects. The Baghdad government has refused to settle the overdue payments. The new deal required the KRG to export approximately 550,000 barrels per day in 2015 and they would receive a payment of 1 billion dollars. The KRG has not been able to meet the quota and Baghdad only issued a partial payment. The partial payment was not enough to pay the oil companies in Erbil and now the KRG is threatening to sell the oil independently. The KRG is under a lot of stress because they do not have the funds to pay the Peshmerga forces their salaries. They do not have the money to support the hundreds of thousands of displaced persons that are coming from the Islamic State controlled areas. The KRG is saying they will be able to export 825,000 barrels per day, which this far exceeds the oil deal with Baghdad. It will most likely result in the KRG going back to selling the independently from Baghdad. The problem with Baghdad is that they are saying the oil exports from the KRG do not match the volume of oil they are reporting. When the oil arrives at the oil distribution facilities, it is not what the KRG is reporting. Both sides will continue to hold talks and negotiate however if no agreement then you will most likely see the KRG go its own way with exporting oil to other countries.

The Central Bank of Iraq (CBI) continues with the sell of U.S. dollars in the form of money orders and paper remittances. When the CBI stated a few months ago that they would be able to cover the foreign accounts abroad it was talking only about the government accounts used in the purchasing of goods and services from other countries. Gurus wanted you to believe that this was the CBI covering your accounts when this is not the case. The CBI stopped with the currency auctions of US dollars to banks and their customers to stop from criminal gangs and regional countries from taking advantage of the CBI dollar sales. The CBI also wanted to predict the foreign currency reserves because it was decreasing as they continued with the currency auctions. The foreign currency reserves was also decreasing because of the costs of the war against the Islamic State ( 6 billion usd a month) and propping up the banks with soft loans. The problem the CBI is having is which banks would better manage the money (soft loans) as 28 banks are under investigation for money laundering and corruption. The CBI banking law forbids the bank to loan the Iraq government any funds from the currency reserves. To get around this the CBI is offering 6 billion dollars loans to the private banking sector. The procedure is complex as most of the banks are inadequate to  handle and facilitate the loan.

On Sunday, March 15, Emirate Airlines has suspended all air travel to Erbil and Sulaymania in Northern Iraq due to security concerns. In January 2015, the Emirate owned FlyDubai airlines was struck by small arms fire as the aircraft was landing at the Baghdad International Airport.

Rich Morris American Contractor  http://americancontractor.com


Emailed to us on 3/14/2015:
Iran is slowly taking over of Iraq... Update on Iraqi dinar Banknotes for recall

   Hi...
The Iranians are continuing with tightening their grip on the Iraqi government and the people. The Iranian militias and the Iraqi government are continuing with their operations for the city of Tikrit. In a news report, an Iranian parliamentary member stated that Baghdad is part of the Persian Empire. The statement by the Iranian parliamentary has caused uproar in Baghdad.

Iran is slowly becoming a dominant power in Iraq and the region. There are thousands of Iranian controlled militias operating in Iraq. The militias are well trained and armed better then the Iraqi army that the United States military trained for 8 years.

The price of oil is $54.67, which is below the $56 dollar price for Iraq’s 2015 federal budget.
The 2015 federal budget also had the Iraqi government exporting 3.3 million barrels of day.
Since the beginning of the year, the Iraq oil exports reached 2.5 million barrels per day. This is short of what the government requires to meet its 2015 budget. There has been no official recording of the 2015 budget in the official gazette. This is because there is a dilemma in the law since the government failed to pass a 2014 federal budget. The International Monetary Fund (IMF) will have the 2015 Iraq country report published next month. The IMF country report will give great insight on what has happened to the Iraqi economy in 2014.

The Kurdistan Regional Government (KRG) is still waiting to receive payment for the state employees from the central Baghdad government. Things are getting bad as a result and Kurdish parliamentary members in Baghdad are threatening to leave parliament.

There are reports from the KRG that the Islamic State (ISIS) used chemical weapons in Iraq. The allegations are from a suicide attack by ISIS on January 23 north of Mosul. There has been no official response about the allegation from ISIS. If this is true, it shows how desperate the ISIS fighters are in fighting the Iraqi and Kurdish forces.

The Central Bank of Iraq (CBI) is continuing with the removal of the 50 Iraqi dinar banknotes from circulation. The people of Iraq never caught on in using the low value worth 50-dinar banknote with a value of only $.04 cents USD. It is the reason why the CBI made the exchange window only 60 days. In the future, when the CBI recalls the other banknotes that have trillions in circulation the exchange window will be much larger like one to two years.

Hope you enjoyed reading the American Contractor Iraq Report.
Best Regards, Rich Morris American Contractor

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