January 28, 2010
Editor’s Note: The following is a first-hand witness report sent via e-mail
REPORT: Details on Money Shortage and Bank Protests in Iran
* The government told the banks that it has no money to pump into them.
* Riots at the Banks in Iran
* “Mousavi, Mousavi” chants at the Bazaar
Two banks (Melli and Mellat) are planning to withhold funds from customers so they will be able to pay back their loans received from investors. The excuse that they are providing is that in order to complete their end-of-year calculations (by March 2010), they need to temporarily close down bank accounts.
The following is an excerpt from reports inside Tehran before the information was spread through word-of-mouth.
Yesterday, near a bazaar in Tehran, a big crowd gathered. Each minute that passed, the number of people demanding to withdraw their money increased.
At 11:30am, the account booths announced they are out of cash and that they are only able to issue interbank notes. The majority of customers objected. The head of the branch then denied reports [of running out of money] and claimed there was no need to empty bank accounts, since it was all just a rumor. The head of the branch was faced with customers demanding their money. The verbal conflicts grew louder and eventually security stepped in, which made the situation worse.
A few minutes later, special guard units entered the branch and beat people up in the worst possible way using batons. They also closed the door on people [to not enter the branch]. The assaulted customers started chanting, “Mousavi, Mousavi” outside the bank.
Upon hearing the chants, a few shops nearby closed down their stores. The bazaar for rugs turned into a security zone. Additionally, anti-riot police agents surrounded the bank.
Since Saturday news has leaked about secret government meetings regarding the banks going bankrupt. In these meetings, Ahmadinejad (the head of the Central Bank) and a few heads of government banks distributed a secret report about the bank crisis. [According to the secret report] Banks Mellat and Melli announced their bankruptcy and asked the government for urgent help.
The news about this meeting quickly spread within the upper echelon of Tehran’s bazaar. Following this news, owners of larger commercial firms decided to withdraw their cash from the two banks. However, the two banks decided to not allow withdrawals over $15,000. To avoid this rule, big investors used the technique of writing bounced cheques (translator’s note: bounced checks must be paid, by law).
Since last Friday, people have been text messaging each other about the bankruptcy of the two banks Melli and Mellat.
The city of Isfahan:
The Melli bank branches in Isfahan were also faced with a rush of people demanding to withdraw their money. At Chahar Bagh and Si-o-se Pol branches there were long lines, and the amount of security forces inside Melli Bank branches indicated the amount of fear the regime has of riots starting at the banks. At 12:00 pm, the Chahar Bagh branch ran into cash problems, and people who were standing in line for hours were sent home, and the bank doors were shut [on them]. These acts resulted in people chanting outside the banks.
Marand, Iran – People in Marand were confronted with bank officials saying:
- We have no money to pay
- We need to wait until a customer deposits cash
- Come back at 2:00 pm
People stood in lines until 2:00 pm, only to realize there was $500,000 set aside for one particular person. The protests began and people clashed with the bank’s security personnel. The clashes turned physical. Additionally, some people helped themselves to cash, and the bank alarms were set off.
People clash with police at a Melli Bank branch, causing injuries to one of the bank customers and the closing down of the bank. People had gone to the bank from the early morning hours to withdraw their money, but they only saw empty vaults. People began shouting and demanding their money and tried to cash their cheques, but the branch officials were unable to respond; even from early morning hours due to a lack of funds.
The bank employees blamed customers who had withdrawn hundreds of thousands of dollars in cash from the bank last Saturday. In most branches, the bank officials asked customers to either use interbank notes or wait until funds arrive from the central branch. After half hour, instead of the funds arriving, security forces arrived and clashed with the people inside the branches.
The anti-riot police agents ordered people to leave the banks. The people resisted. In the Sadeghieh branch, one of the bank officials threw his pencil holder at a customer who happened to be a middle aged woman. Other people present at the scene then took the woman to the hospital for her injuries. Out of fear of retribution by the angry crowd, the bank official began loudly cursing at regime officials. The bank official’s name tag read: Ebrahim Ghorani.
They were finally able to kick people out of the banks and close the doors. The lack of funds was such that the head of one of the branches ordered bank employees to empty the cash counting machines.
Translation by: Tour Irani