By Jeremy Herb - 02/06/12 03:55 PM EST
President Obama has signed an executive order issuing new sanctions against Iran and its central bank.
The order says that Iranian assets possessed by any U.S. citizen or company, including banks' foreign branches, cannot be "transferred, paid, exported, withdrawn."
The executive order was necessary because of the "deceptive practices" of the Central Bank of Iran, Obama said.
The sanctions are the latest attempt by the administration to nudge Iran into giving up its nuclear weapons program. The European Union is imposing financial penalties as well, imposing an oil embargo on Iran last month that will take effect in July. The EU oil ban could prove devastating for Iran's economy.
“The problem here is Iranian behavior,” White House spokesman Jay Carney said Monday. "We will continue to pursue that course and press for change in behavior by the Iranians, even as the president has made clear on a number of occasions, we do not remove any options from the table.”
Carney said the U.S. sanctions are causing turmoil in Iran, damaging the country's economy and currency.
The executive order implements part of an amendment on Iran that was included in the Defense authorization bill, legislation that Obama signed into law last December.
Sen. Bob Menendez (D-N.J.), who authored the sanctions amendment with Sen. Mark Kirk (R-Ill.), said the administration's move will pressure Iran to abandon its nuclear ambitions.
“I am very pleased by the president’s actions to enforce the sanctions Sen. Kirk and I authored to block Iranian assets — including its Central Bank assets — in the United States,” Menendez said in a statement.
The Senate Banking Committee passed a measure last week to impose further sanctions on Iran, this time targeted at the Islamic Revolutionary Guard Corps.
The new U.S. sanctions strengthen existing efforts to limit the financial reach of Iran's government, central bank, and financial institutions. Under sanctions put in place in 1995, any Iran-tied transaction is not permitted to move through the U.S. financial system.
Under the new crackdown, Treasury will also move to freeze the assets involved in an attempted Iran transaction. Similarly, any attempt by a U.S. citizen to deal with one of the blocked Iranian entities could result in a seizure of assets, unless the transaction is expressly exempted.
The Treasury Department is issuing licenses that will allow some transactions with Iran to continue, so long as they advance U.S. interests.
For now, the government is not trying to increase pressure on foreign financial institutions to halt transactions with Iran. Foreign businesses that engage in significant business with Iranian financial institutions still remain at risk of U.S. sanctions, however.
Obama said in an interview with NBC on Sunday that he still hoped for a diplomatic solution with Iran. The United States and its allies believe the Iranians are looking to make nuclear weapons, while Iran says its nuclear program is meant for peaceful energy purposes.
“My goal is to try to resolve this diplomatically, mainly because the only way over the long them we can assure Iran doesn't have a nuclear weapon is by getting them to not — understand that it's not in their interest," Obama said Sunday.
Iran has not backed down in the face of sanctions, threatening to close the Strait of Hormuz in response to the December sanctions on its central bank.
Peter Schroeder contributed.
— This story was last updated at 1:11 p.m.