U.S. Imposes New Sanctions on Iran, Designating Head of Central Bank a Terrorist
Posted May 15, 2018 1:49 p.m. EDT
Updated May 15, 2018 1:52 p.m. EDT
WASHINGTON — The Trump administration accused the head of Iran’s central bank of funneling money to Hezbollah and designated him as a global terrorist Tuesday, placing further financial constraints on Tehran a week after President Donald Trump called for reimposing sanctions that were lifted as part of an Obama-era nuclear deal.
The new designation is separate from the nuclear sanctions that were reinstated last week against Iran. But after Trump announced his decision to back out of the nuclear deal, he promised to sanction any firms — including banks — that do business with Iran.
Last week, the U.S. Treasury Department, in coordination with the United Arab Emirates, sought to disrupt an Iranian currency exchange network that transferred money to the Islamic Revolutionary Guards Corps to help fund the terrorist group Hezbollah. The exchange system worked with Iran’s central bank and the Treasury Department said Tuesday’s actions were a continuation of attempts to disrupt it.
It is rare to place a governor of a central bank on the global terrorist list. The Treasury Department said the governor of Iran’s central bank, Valiollah Seif, “covertly funneled millions of dollars” to support Hezbollah from the Islamic Revolutionary Guards Corps through Iraq’s al-Bilad Islamic Bank.
Also newly included on the United States’ global terror list was Ali Tarzali, another senior official at Iran’s central bank, as well as the al-Bilad Islamic Bank in Iraq and its chairman, Aras Habib. Habib recently won a seat in the Iraqi Parliament under the coalition headed by Prime Minister Haider al-Abadi.
“The United States will not permit Iran’s increasingly brazen abuse of the international financial system,” Treasury Secretary Steven Mnuchin said in a statement Tuesday. “The global community must remain vigilant against Iran’s deceptive efforts to provide financial support to its terrorist proxies.”
The designations are part of the Trump administration’s efforts to disrupt Hezbollah’s financial network. In February, the Treasury Department targeted six people and seven businesses in Africa and the Middle East for acting as front companies for the terrorist group.
Tuesday’s actions are expected to make it harder for Iran to do business with other foreign banks as well, said Farhad Alavi, a partner at Akrivis Law Group in Washington and an expert in U.S. sanctions.
“This will make it near impossible,” Alavi said. “I would question whether any foreign banks would want to engage directly with the Central Bank of Iran at this point.”
Cliff Kupchan, chairman of Eurasia Group, said Tuesday’s actions come at a time when Europe and other nations are scrambling to address the fallout from the United States’ reinstatement of its sanctions on Iran.
In making these designations, Kupchan said, “Trump today sent a shot across their bows with this show of resolve.”