Thegurdian: PayPal has suspended an account belonging to an Iranian human rights group based in London, citing sanctions placed by the west on the country – highlighting how blanket measures are harming ordinary people and activists.

Justice for Iran (JFI), a non-profit organisation dedicated to documenting human rights violations, said its account had been suspended and at least six people who donated to the group’s cause were facing similar difficulties.

It said PayPal’s decision was fundamentally wrong because sanctions, imposed on Tehran over its nuclear programme, are meant to target the Iranian government and not ordinary people, especially those highlighting rights abuses there.

However, sanctions have had unintended consequences on Iranians at home and abroad. Iran’s banking system, in particular, is completely cut off from the outside world, which has made life difficult for patients in need of life-saving medicines and students who cannot subscribe to international journals, among others.

Shadi Sadr, JFI’s executive director, said the group has not been able to access the account for more than a month, although it has contacted PayPal to explain that it has no links to the Iranian government.

She said JFI has not been able to open any bank account in the UK since it was registered in the country in November 2012 – because the group’s name includes the word “Iran”.

Sadr told the Guardian: “This is utterly unfair and ridiculous that the sanctions, which were supposed to target the Islamic republic, harm a human rights organisation that aims to hold Iran accountable for its human rights record.

“PayPal has refused to provide us any substantial explanation about its unjust decision. By blocking our money, the company shows little respect for those who fight for human rights and their supporters.”

PayPal said it was merely obeying US regulations, but JFI said the decision was based on a misreading of the sanctions policy.
A spokesperson for the company said: “PayPal is required to ensure it complies with laws and regulations in the countries in which it operates around the world. As a United States company, PayPal and all of its subsidiaries are obliged to comply with US government-imposed sanctions, even if these subsidiaries operate outside the US.

“According to the US government’s Office of Foreign Assets Control (OFAC) regulations, payments that involve Iran have to be declined if they are processed through PayPal even if the sender or receiver of the payments is not based in the US.”

Although sanctions are not targeted at ordinary people, many international companies and organisations err on the side of caution to avoid trouble. A growing number of Iranains living in the UK or British citizens with Iranian backgrounds have also seen their bank accounts closed in recent years – even though they have no connection with the government.

One donor, whose payment to JFI was blocked, received this message from PayPal: “Our compliance department has reviewed your account and identified activity that may be in violation of export restrictions.”

Another complained that she was asked to sign an affidavit for violating PayPal’s terms and conditions and said she was worried she could get into trouble when travelling to the US.

It emerged this week that a talented Iranian architect, Leila Araghian, was not allowed to enter the World Architecture Festival because of sanctions.

A spokesperson for Top Right Group, which organises the festival, said: “Top Right Group is unable to trade with Iranian businesses and as a result, the World Architecture Festival (WAF), along with all our other events and brands, cannot currently accept award entries from businesses or individuals within Iran. The WAF team regrets the situation but we need to ensure complete transparency for all our partners.”

In February, the University of Massachusetts Amherst, which had previously barred Iranian students from entering its chemical, computer and engineering courses, reversed its decision and lifted restrictions on all subjects. It did so after consultation with the US Department of State, and after activists pointed out it was a clear example of misreading sanctions.

The UK Treasury declined to officially comment on the PayPal case, the exclusion of Araghian and the bank account closures, citing “Purdah” rules regarding the general election, which restrict the activity of civil servants during pre-election periods.

The Treasury’s position is that the government cannot ask banks to provide financial services to all individuals and entities who are not subject to sanctions – to whom a bank provides a service is a business decision that it takes, and this varies from bank to bank.

According to the rules governing money sent from Iran to the UK, the law would not stop the architect entering the competition as the £400 entry fee is below the threshold at which prohibitions apply.

An Foreign Office spokeswoman said: “EU sanctions against Iran are not intended to affect humanitarian goods and payments. There have always been explicit exemptions to allow Iran to purchase humanitarian goods such as medicines.”