U.S. Court Drops Suit against Clearstream over Iran Dealings

A U.S. Court has dropped a lawsuit against Clearstream in relation to assets, belonging to the Central Bank of Iran, which it holds in custody.
By Joe Parsons(2147488729)
A U.S. Court has dropped a lawsuit against Clearstream in relation to assets, belonging to the Central Bank of Iran, which it holds in custody.

The lawsuit, which was filed in September last year, sought access to $1.6 billion of frozen assets that belong to the central bank of Iran, Bank Markazi, which have been held by Clearstream in Luxembourg. The assets have been frozen since 2012 as part of European sanctions.

The plaintiffs, which are the families of U.S. soldiers that were killed or wounded in the bombing of a Marine barracks in Lebanon in 1983, claimed they were entitled to the funds on the grounds that they are linked to funds processed through Clearstream’s U.S. cash correspondent account at JP Morgan in New York.

However, Clearstream have previously argued the funds in the New York account belonged exclusively to Clearstream and that the U.S. court has no jurisdiction in Luxembourg.

The U.S. District Court for the Southern District of New York dismissed the case on Friday.

“We acknowledge the court’s decision and consider it to be consistent with well-established U.S. and international financial infrastructure regulations and obligations,” says an emailed statement from Clearstream.

The decision from the court comes one day after Deutsche Boerse, which owns Clearstream, announced in an earnings call that it had set aside $5.13 million in legal provisions at the end of 2014 in anticipation of a settlement.

In January 2014, Clearstream agreed to pay $152 million to the Office of Foreign Assets Control (OFAC), in relation to suspected violations of U.S. sanctions on Iran.

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