Assessing the Effectiveness of Financial Regulatory Authorities in Preventing Money Laundering Linked to Foreign Investors: A Case Study of Iran in Light of International Standards

Donyanoor, Ahmad; Ebrahimi, Seyed Nasrollah; Momenirad, Ahmad

doi:10.22034/ejs.2026.594281.2202

Assessing the Effectiveness of Financial Regulatory Authorities in Preventing Money Laundering Linked to Foreign Investors: A Case Study of Iran in Light of International Standards

Articles in Press

Document Type : research

Authors

Ahmad Donyanoor ¹

Seyed Nasrollah Ebrahimi ²

Ahmad Momenirad ³

¹ Department of Public International Law, KI.C., Islamic Azad University, Kish, Iran.

² Department of International Law, Faculty of Law, University of Tehran, Tehran, Iran

³ Department of International Law, Faculty of Law, University of Tehran, Tehran, Iran.

10.22034/ejs.2026.594281.2202

Abstract

Background and Aim: While foreign investment serves as a catalyst for economic development, it can simultaneously become a channel for transferring illicit funds and facilitating money laundering. This inherent paradox is particularly evident in developing economies such as Iran, which on the one hand seeks to attract capital and on the other faces institutional challenges in ensuring effective oversight. This study evaluates Iran’s regulatory framework in preventing money laundering associated with foreign investment.

Materials and Methods: This research is theoretical in nature and employs a descriptive analytical method.

Findings: Although Iran has established a basic legal framework to combat money laundering, its financial regulatory agencies continue to face several structural challenges. From a comparative perspective, Iran’s supervisory regime exhibits notable deficiencies relative to international standards, particularly in areas related to beneficial ownership transparency and integrated oversight.

Ethical Considerations: In order to organize this research, while observing the authenticity of the texts, honesty and fidelity have been observed.

Conclusion: The primary gap lies in the absence of an integrated supervisory system and insufficient inter agency coordination. In other words, “the conflicting perspectives of involved parties underscore the necessity of relying on impartial international mechanisms to resolve investment related disputes.” The issue becomes even more complex when “certain behaviors of foreign investors may directly threaten the national security of the host state

Keywords

Financial regulatory authorities

money laundering

foreign investment

international standards

Iran

Financial Action Task Force (FATF)

Subjects