An international network in control of the world's largest financial messaging system announced on Thursday it intends to cut off Iranian banks targeted by European Union sanctions.
The move is an unprecedented measure that will effectively prevent Iranian institutions from electronically transferring global funds.
In a statement, the Society for Worldwide Interbank Financial Telecommunication (SWIFT) indicated that those financial institutions hit by EU measures would be removed from the network as of Saturday, March 17.
"The new European Council decision, as confirmed by the Belgian Treasury, prohibits companies such as SWIFT to continue to provide specialized financial messaging services to EU-sanctioned Iranian banks," the statement said, adding that "SWIFT is incorporated under Belgian law and has to comply with this decision as confirmed by its home country government."
SWIFT CEO Lázaro Campos said that the EU decision to sanction Iranian banks forced "SWIFT to take action," adding, "Disconnecting banks is an extraordinary and unprecedented step for SWIFT. It is a direct result of international and multilateral action to intensify financial sanctions against Iran."
The SWIFT statement added that the network "remains in full compliance with all applicable sanctions regulations of the multiple jurisdictions in which it operates, and has received confirmation of this from the competent regulatory authorities."
"As a global provider of secure messaging services, SWIFT has no involvement in or control over the underlying financial transactions that are contained in the messages of its member banks," the statement added.
In December, EU foreign ministers adopted new sanctions against Iran in response to the country's nuclear program, indicating that the Iran restrictive measures would pave the way for another 37 people and 143 entities to be hit with travel bans and asset freezes.
U.K. Foreign Secretary William Hague said at the time that the "intensification of economic sanctions on Iran, particularly to increase the isolation of the Iranian financial sector" should be seen in light of efforts to halt Tehran's nuclear program, and not simply as a reaction to the storming of the U.K's embassy in Tehran in January this year.