UBS has been accused by a leading American congressman of breaking US sanctions on Iran during the 1990s, according to a report in the Londo...

UBS has been accused by a leading American congressman of breaking US sanctions on Iran during the 1990s, according to a report in the London-based newspaper the Daily Telegraph.

Dana Rohrobacher, the chairman of a congressional inquiry into offshore banking and terrorism, is looking into holding hearings to determine whether UBS endangered world security by helping Iran through the illegal transfer of $440 million in US bank-notes in the 1990s.

Mr Rohrobacher was recently quoted in a congressional hearing as saying: "Iran at that time was facing a credit crunch. If the US was trying to restrict Iran's flow of income, but UBS was working to supplement it through loans and credits, then it seems to me the bank was working directly against the interests of the country that acted as one of the most important sources of business.”

He added: "Worse, UBS transferred US banknotes to Iran in violation of the very programme they were entrusted to run.”

According to the Daily Telegraph report, Mr Rohrabacher, a California Republican and former aide to President Ronald Reagan, has linked UBS with Osama Bin Laden and said this was an example of the bank's "malfeasance".

UBS strongly denies that Osama Bin Laden was ever a client of the bank.

The Zurich-based bank has admitted supplying Iran, Cuba, Libya and Saddam Hussein's Iraq with dollars obtained through a US Federal Reserve scheme, for which it paid a $100 million fine, according to the report.

UBS has said that the appropriate internal measures including the firing of eight staff members to deal with the breach of regulations, but the bank denies that any of the dealings related to terrorism or money-laundering.

A senior Swiss banking source told WealthBriefing that the latest accusations against UBS are another example of Washington trying to turn the screw on non-US banks for alleged compliance failures.

“There have been a whole string of compliance cases involving foreign banks in recent years emerging from the US, including recent high profile cases involving ABN Amro and HVB, the German bank. One has to ask the question: is there ever a US bank being targeted in quite the same way by Washington?”