Iraq hits Kurdish banking

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BAGHDAD, Nov 9, (RTRS): Iraq’s central bank has ordered private banks to close their branches in the Kurdistan region within a week to avoid a ban on dollar sales, Iraqi banking sources said on Thursday.

The central bank’s deadline expires on Nov 14 and all banks must report back with confirmation they have closed their branches to avoid penalties, the sources said.

The new measures are part of financial restrictions imposed by Baghdad in retaliation for a Kurdish referendum held on Sept 25, in which the region voted overwhelmingly for independence. In Oct 16, a lightning advance by Iraqi government forces captured the Kurdish-held city of Kirkuk and many disputed territories in response to the Kurdish referendum.

Iraqi banking sources said the new measures are intended to control the fl ow of hard currency into the Kurdish region. “Central bank seeks to re-organise relations with Kurdistan regional banking industry,” said a government financial advisor who is close to central bank policy.

Central bank sources said a decision in October to stop selling dollars to four leading Kurdish banks was still effective. The Baghdad government has also imposed a ban on direct international fl ights to and from the Kurdish region.

The Shi’ite, Arab-led Iraqi central government has rejected an offer by the Kurdish government to discuss independence. Backed by Iran and Turkey, Baghdad has demanded that the Kurdish authorities cancel the referendum result or face continued sanctions and international isolation. Four hours after first hearing gunfire outside his home, Abu Riwar bundled his wife and six children into his car and drove to a remote village 120 kms (75 miles) away. “We left with the clothes on our back and nothing else,” said Abu Riwar, a member of the Kurdish security forces from the ethnically mixed town of Tuz Khurmato, seized last month by Iraqi troops and Iran-backed Shi’ite paramilitaries. “If the militias found out I was peshmerga, they’d have slaughtered me.” They burned his home to the ground instead, his neighbours, who captured it on camera, told him.

Tuz Khurmato was part of disputed territory, outside the Kurdish region of northern Iraq but held by Kurdish forces known as peshmerga, until last month, when the central government recaptured it in a lightning advance to punish the Kurds for staging an independence referendum that Baghdad called illegal.

The majority of Tuz Khurmato’s 50,000 Kurds — around half of the population of the ethnically mixed city — fled the Iraqi advance to Kurdishheld villages and towns in nearby countryside, said Mayor Shalal Abdul. The mayor himself fled to the village of Zinana, 120 kms east of Tuz Khurmato, where he spoke to Reuters. Most residents have no plans to return home, citing reports of continuing attacks. “We can’t cope if it continues like this,” said the chief of police in Zinana, adding that the government and aid groups had been too slow to respond. “Families have taken over school buildings, houses and the hospital, but we can’t turn them out on the streets.”

According to the United Nations, more than 180,000 people were displaced by the Iraqi government offensive on disputed territories last month. Aid agencies say most of those displaced are Kurds, though members of other minorities, including some of Tuz Khurmato’s Sunni Arabs and Turkmen, also fled. Until Baghdad’s offensive, Tuz Khurmato had been jointly administered by Kurdish forces, local police and the Iran-backed Popular Mobilization Forces (PMF) paramilitaries, allied with the town’s Shi’ite Turkmen population. Though the Turkmen and the Kurds had worked together to push Islamic State militants out in 2014, the town’s fragile coalition soon fell apart and led to open hostilities. In the run-up to the Kurdish independence referendum, tension escalated between the communities. In Zinana, displaced Kurds told Reuters stories of abuse at the hands of the Shi’ite paramilitaries who captured Tuz.

One man showed a video he had filmed depicting the crushed body of a relative. Family members said the victim had been shot in his car, dragged out alive by paramilitaries and run over by a tank. “He was crushed to death in front of me, by those monsters,” said Abu Alan, the relative who filmed the body. “He was a good man from a good family.” A video circulated on the internet, apparently of the same incident, shows a tank running over a body while uniformed paramilitaries stand by. The paramilitaries deny carrying out any abuse.

“Joint patrols by the PMF and government forces are securing the town, to prevent any attacks against Kurds,” said Ali al-Hussaini, a spokesman for the PMF in northern Iraq and a commander of the largest of the armed groups, the Badr Organisation. “It’s our job to keep Tuz safe for all sects.” The mayor, who is collecting stories and evidence of abuse, said seven people were killed when the town was captured, including the man who was crushed by the tank and three other civilians. He said he also knew of three women and one man who had been raped.

Reuters could not verify those accusations. More than 1,000 businesses and 2,000 homes were looted, burned down or demolished, the mayor said. He showed Reuters images of houses and shopfronts in Kurdish areas, blown up and scorched, their residents’ belongings being carted away by men in military fatigues. Other pictures showed paramilitaries sitting in the mayor’s own office, feet propped up on his desk and on his Kurdish flag. Dozens of people were detained, and some say they were tortured, like Thiaa, a 20-year-old Sunni Turkman from the countryside who had gone to Tuz Khurmato the day after the offensive to check on his sister who was married to a Kurd.

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