FDD Welcomes Bipartisan Sanctions Bill Targeting Iran’s Foreign Exchange Reserves

FOR IMMEDIATE RELEASE

In a strong sign of bipartisan support for intensified pressure on the Iranian regime, United States Senators Mark Kirk (R-IL), Joe Manchin (D-WV), Susan Collins (R-ME), Bill Nelson (D-FL), and John Cornyn (R-TX) today introduced the Iran Sanctions Loophole Elimination Act. The bill targets Iran's overseas foreign exchange assets generated as a result of prohibited activities or held by designated Iranian entities and goes into effect on May 9, 2013. 

The bill restricts the ability of the Central Bank of Iran (CBI) and the National Iranian Oil Company (NIOC), for example, from transacting in foreign currencies, including the euro, and targets Iranian foreign exchange assets that were generated as a result of a range of activities already prohibited under U.S. law. The bill authorizes the President to impose sanctions on any foreign bank involved in facilitating transactions in foreign currencies over which it does not have primary jurisdiction (for example, euros held in Swiss or Chinese banks or rupees held in Russia banks). 

FDD Executive Director Mark Dubowitz:  “Iran uses its foreign exchange reserves as its principal hedge against the impact of sanctions, which are designed to persuade the regime to compromise over its illegal nuclear weapons program.  Since the implementation of U.S. financial sanctions, the Central Bank of Iran has moved its assets from dollars into euros and other currencies. This legislation should encourage European regulators to close the euro-loophole against this kind of activity, put other foreign banks on notice that the U.S. authorities will crack down on Iran's use of other currencies, and still provide Iran ample funds to legally meet the humanitarian needs of its people.”  

For more information or to speak with FDD experts, please contact Madeleine Levey Lambert at [email protected] or 202-403-2941.