SWIFT as a Weapon
SWIFT — the Society for Worldwide Interbank Financial Telecommunication — is a Belgian cooperative that provides the messaging infrastructure for international bank-to-bank payments. It is not a bank, not a government agency, and nominally not a US institution. Yet it has become one of the most powerful tools of American economic statecraft, and its use as a financial weapon represents one of the most significant developments in 21st-century geopolitics.
What SWIFT Is
SWIFT is the routing system for international financial messages. When a German bank wants to transfer funds to a Japanese bank, it sends a standardised message through SWIFT to initiate the transfer. The system processes approximately 42 million messages daily, connecting over 11,000 financial institutions in more than 200 countries. Without SWIFT access, a bank effectively cannot conduct international transactions — it is cut off from the global financial system.
SWIFT was established in 1973, headquartered in Belgium, and governed by a board including major international banks. It is theoretically neutral — a piece of financial infrastructure like the internet's routing system.
The Transformation into a Sanctions Tool
The post-9/11 period saw the US Treasury Department — specifically its Office of Foreign Assets Control (OFAC) and its Terrorist Finance Tracking Program — assert pressure over SWIFT through legal mechanisms. Because SWIFT processes dollar-denominated transactions through US correspondent banks, it falls within US regulatory jurisdiction for those transactions. The US has leverage over SWIFT not because SWIFT is American, but because the dollar is.
The first major SWIFT exclusion came with Iran: under the Comprehensive Iran Sanctions Act of 2010, the EU pressured SWIFT to disconnect Iranian banks in 2012. Iranian oil exports, which had been earning roughly $100 billion annually, collapsed as buyers could not make payments through normal banking channels. The sanctions were among the most effective in modern history — contributing to negotiations that produced the 2015 Joint Comprehensive Plan of Action.
Russia 2022
After Russia's invasion of Ukraine in February 2022, the US, EU, UK, Canada, Australia, and Japan agreed to disconnect selected Russian banks from SWIFT. Seven major Russian banks were excluded — though Gazprombank (which processes energy payments) was initially exempted to allow oil and gas flows to continue.
The SWIFT exclusion was paired with other measures: asset freezes, travel bans, and the freezing of approximately $300 billion in Russian central bank reserves held in Western institutions. Together, they represented the most comprehensive financial sanctions ever imposed on a major economy — a country that before the invasion had been the world's 11th largest by GDP.