Levey, the undersecretary for Terrorism and Financial Intelligence, said in a telephone interview that the Treasury is actively talking to private companies and financial institutions and warning them of the dangers of doing buiness with Iran.
The Treasury has stepped up its blacklisting of Iranian entities and individuals in the past year amid rising concerns in Washington that Iran’s government is racing to develop nuclear weapons.
The government of Iranian President Mahmoud Ahmadinejad has steadfastly denied such claims and says its nuclear program is peaceful, but Tehran has been sanctioned by the UN Security Council for refusing to halt uranium enrichment, which can be used to build a nuclear weapon.
“We believe that there is a real potential that these sanctions will have the effect of changing the government of Iran’s mind about the defiant policy it is currently pursuing,” Levey, who formerly coordinated counterterrorism operations at the Justice Department, said.
The Treasury has sanctioned more than a dozen Iranian entities so far this year, mainly companies tied to Iran’s nuclear, energy and industrial sectors, but the US financial offensive has also zeroed in on Iran’s banking sector.
It imposed sanctions against Iran’s state-owned Bank Sepah, the country’s fifth-largest bank, in January and against Bank Saderat last September, moves which Levey said were partly intended to cut off the financing for Iran’s missile programs.
Treasury officials believe Bank Sepah financed a Chinese firm’s sale of “missile-related items” to Iran in 2005. Bank Saderat, one of Iran’s largest lenders with some 3,400 branches, was blacklisted for allegedly supporting terrorism.
“We’re keeping a broader eye on the Iranian banking sector, but I don’t want to speculate or signal possible future actions,” Levey said.
He said Washington hopes some of the Treasury’s actions will catch the attention of the Iranian people and they will realize they would be better off cooperating with “the international community,” rather than defying it.
However, Levey stressed that the department, which has been supported in its efforts by other arms of the US government, is not just pursuing sanctions.
“There’s a fairly attractive set of incentives put on the table by the allies for the Iranians if they do suspend their uranium enrichment,” he said.
The Treasury’s sanctions generally bar US companies and invididuals from doing any business or transactions with blacklisted Iranian firms, while also seeking to freeze any assets of the targeted entities that come under US control.
The administration of US President George W. Bush hopes such moves will encourage other countries to close off their financial and trading links with Iran.
Levey said the department had received good cooperation from the private sector and that Treasury officials have briefed private sector executives about the “deceptive practices” used by Iranian entities.
The Treasury’s anti-terrorism point man added that, as a result, “a lot of financial institutions” have opted not to do any business with Iran.
Levey’s office of Terrorism and Financial Intelligence was created in 2004 to bolster US efforts targeting illicit financing. Levey, a Harvard graduate, was named to oversee its operations by President Bush the same year.
