Weeks before it is to reimpose another round of punishing sanctions on Iran, the Trump administration warned the world’s banks on Thursday that Tehran might try to use duplicitous means to soften the sanctions’ bite and continue to fund terrorism.

Iran’s bankers and officials have used front companies, fraudulent documents and other measures to generate revenue for the country’s terrorist activities, the administration said.

“Any country that allows its central bank to be involved in deception in support of terrorism requires the highest levels of scrutiny, particularly when the country itself is the world’s largest state sponsor of terrorism,” said Sigal Mandelker, the Treasury under secretary for terrorism and financial intelligence.

The warning is part of a coordinated campaign by the administration to persuade banks and corporations around the world to sever all commercial ties with Iran, not only because of looming American sanctions but also because it says Tehran diverts even seemingly innocuous transactions toward illicit ends. No new sanctions or penalties were announced on Thursday.

President Trump announced in May that the United States was leaving the Iran nuclear deal and restoring sanctions lifted under the 2015 accord. The first set of sanctions banning transactions involving dollar bank notes, gold and other commodities went into effect in August. The next, more punishing set of sanctions banning transactions with Iran’s central bank, shipping companies and oil suppliers, is scheduled to take effect on Nov. 5.

In recent months, teams of officials from the Treasury and State Departments have visited more than 30 countries to talk with not only government officials but also trade and financial organizations to lay out their case against Iran.

Even though leaders from Europe, Russia and China have all said they oppose the latest reimposition of sanctions, the American teams have been remarkably successful. Nearly all major European businesses with operations in Iran have announced that they are leaving the country and abandoning investments there. Iran’s currency has plunged more than two-thirds, and its oil exports are down as well.

But the big question for months has been how far the Trump administration will go in imposing sanctions on countries like China, India, Turkey and even European allies that continue to do business in Iran. When asked, administration officials have been implacable in insisting that sanctions will be applied broadly to entities that maintain commercial relationships in Iran, and on Thursday a top Treasury Department official reiterated that threat in a call with reporters. But exceptions are widely expected, an important reason oil prices remained fairly steady in the months after Mr. Trump’s decision to walk away from the accord.

In recent weeks, however, oil prices have edged higher as anxiety about the looming sanctions mounts.

Besides rising oil prices, another worry for the administration has been financial engineering efforts that avoid the use of the dollar, the dominant currency of global trade. At the United Nations General Assembly meeting last month, foreign ministers from Germany, France, Britain, Russia, China, the European Union and Iran announced the creation of a “special purpose vehicle” independent of the dollar to further trade with Iran. Russia and other countries under sanction have in recent months discussed using cryptocurrencies to avoid the global financial system with connections to the United States.

Officials have said they are watching such engineering attempts closely, although few economists and officials in Europe believe such efforts will offer Tehran much in the way of sanctuary from American penalties immediately.

“Financial institutions should also be aware of possible Iranian abuses of virtual currency and precious metals to evade sanctions and gain access to the international financial system and to conceal their nefarious actions,” the Treasury Department said in its announcement on Thursday.

Sanctions apply only to entities that knowingly evade sanctions, the Treasury Department official said on Thursday. But the Trump administration issued its warning about Iran’s duplicity in the hopes banks and other institutions would take precautions and not be fooled, the official said. Banks should report to the Treasury Department any transactions they deem suspicious, the official added.

Source » nytimes