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Iran Sanctions - Foreign Press Centers

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<strong>Iran</strong> <strong>Sanctions</strong><br />

discussed below). The premise of the provision is that cutting off <strong>Iran</strong>’s access to the international<br />

financial system would make it more difficult for <strong>Iran</strong> to move its money.<br />

The binding provisions of Section 104 of CISADA require the Secretary of the Treasury to<br />

prescribe several sets of regulations to forbid U.S. banks from opening new “correspondent<br />

accounts” or “payable through accounts”—or force the cancellation of existing such accounts—<br />

with foreign banks that process “significant transactions” with the entities discussed above.<br />

<strong>Foreign</strong> banks that do not have operations in the United States typically establish such accounts<br />

with U.S. banks as a means of accessing the U.S. financial system and financial industry. The<br />

entities with which transactions would trigger the sanctions are<br />

• The Islamic Revolutionary Guard Corps (IRGC) or any of its agents or affiliates<br />

that are sanctioned under U.S. executive orders. The two executive orders that<br />

have served as the principal source of U.S. sanctions against <strong>Iran</strong>ian firms and<br />

organizations are Executive Order 13224 (September 23, 2001) and 13382 (June<br />

28, 2005), discussed elsewhere in this report.<br />

• Any entity that is sanctioned by U.S. executive orders such as the two mentioned<br />

above. To date, over 125 entities (including individuals), almost all of them <strong>Iran</strong>based<br />

or of <strong>Iran</strong>ian origin, have been designated for <strong>Iran</strong>-related proliferation or<br />

terrorism activities under these orders. A full list is at the end of this report.<br />

• Any entity designated under the various U.N. Security Council resolutions<br />

adopted to impose sanctions on <strong>Iran</strong>.<br />

• Any entity that assists <strong>Iran</strong>’s Central Bank in efforts to help the IRGC acquire<br />

weapons of mass destruction or support international terrorism.<br />

<strong>Sanctions</strong> Imposed?<br />

The United States has not announced any sanctions against any bank under this provision of<br />

CISADA.<br />

Section 311 of the Patriot Act<br />

On November 21, 2011, the Administration took further steps to isolate <strong>Iran</strong>’s banking system and<br />

to dissuade foreign banks and countries from dealing with any <strong>Iran</strong>ian bank. Secretary of the<br />

Treasury Geithner announced that day that the Administration had acted under Section 311 of the<br />

USA Patriot Act (31 U.S.C. 5318A) to identify <strong>Iran</strong> as a “jurisdiction of primary money<br />

laundering concern” 29 —that its financial system, including the Central Bank, constitutes a threat<br />

to governments or financial institutions that do business with these banks. Banks that do business<br />

with the <strong>Iran</strong>ian financial system were declared at risk of supporting <strong>Iran</strong>’s pursuit of nuclear<br />

weapons, its support for terrorism, and its efforts to deceive financial institutions and evade<br />

sanctions. The designation carried no immediate penalty, per se, but it imposes additional<br />

requirements on U.S. banks to ensure against improper <strong>Iran</strong>ian access to the U.S. financial<br />

system. It was also intended to cause foreign banks to cease doing business with <strong>Iran</strong>ian banks.<br />

29 http://www.treasury.gov/press-center/press-releases/Pages/tg1367.aspx.<br />

Congressional Research Service 21

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