Iraq's central bank will prohibit five more local banks from US dollar transactions following meetings with US Treasury officials in Dubai, aiming to curb money laundering and dollar smuggling, sources told Reuters. The decision follows last year's ban on eight banks and comes amid growing US scrutiny over Iraq's financial sector, which has been a conduit for Iran to access hard currency despite sanctions. Iraq, which holds over $100 billion in reserves in the US, remains reliant on Washington's goodwill to maintain financial access. The move coincides with US President Donald Trump's former vow to reinstate his "maximum pressure" policy on Iran, which relies on Iraq as an economic lifeline. The banned banks—Al-Mashreq Al-Arabi Islamic Bank, United Bank for Investment, Al Sanam Islamic Bank, Misk Islamic Bank, and Amin Iraq For Islamic Investment and Finance—can continue operations in other currencies but face restricted international transactions. Three payment service firms, Amawl, AL-Saqi Payment, and Aqsa Payment, were also affected. The Central Bank of Iraq and the US Treasury did not immediately respond to Reuters' request for comment on the matter. Attribution: Reuters Subediting: M. S. Salama
