ERBIL, Kurdistan Region of Iraq – The Iraqi Karkh Investigation Court announced Tuesday that they had recovered 11 billion Iraqi dinars (around 7.5 million US dollars) in fraudulent monetary exchange activities outside the country.

“The Karkh Investigation Court was able to recover an amount of eleven billion Iraqi dinars from a financial fraud crime,” read a statement by the Iraqi judiciary, adding that “the amount was recovered from a company that violated the law to obtain the difference in the dollar exchange rate through fraudulent money transfers outside the country.”

A discrepancy between the value of the US dollar as set by the central bank compared to its actual value in the Iraqi markets, around 1,320 to 1,500, has been exploited for years by people who found different ways to take advantage of the difference, despite repeated government’s efforts to address these schemes.

Individuals and even organized networks, taking advantage of this discrepancy, use multiple bank-issued cards to exchange and withdraw their Iraqi dinars in US dollars in foreign countries at the central bank’s 1,320 rate before selling it upon returning to Iraq in the Iraqi markets at a markup for a quick profit.

“Efforts are ongoing to take legal action against the remaining companies that follow illegal methods to obtain large profits,” the judiciary said, arguing that the process is “harming public funds."

The Iraqi government has taken numerous measures to address the phenomenon, with the procedure having been outlawed by authorities in Iraq and limitations being placed on cash withdrawals from Iraqi banks abroad.