Senators look to advise Treasury on Iran sanctions

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The two senators' measure forces the United States to sanction foreign banks that do significant business with Iran and its central bank. State-owned and central banks can only be sanctioned for oil-related transactions, and the measure also includes a waiver for food, medicine and other humanitarian assistance meant for the Iranian people.

President Obama signed the defense authorization act, which included the sanctions measure, on Dec. 31. But before that, administration officials had expressed some concern about Kirk and Menendez’s ideas, saying the sanctions could damage relationships within the international coalition opposing Iran. 

Under the measure, the president is also allowed to exempt countries from sanctions if the nation has “significantly reduced” its petroleum purchases from Iran.

In their letter to Geithner on Thursday, Kirk and Menendez looked to, among other things, define what it means for a foreign bank to have a “significant” transaction with Iran’s central bank and how they think the petroleum exemption should be implemented.

A Treasury official said Thursday that the administration was plugging away at drafting regulations for the law, and was already using the measure to impede Iran’s ability to raise revenue from oil.

“High-level delegations from the Departments of the Treasury and State have already been traveling across the globe to consult with their counterparts on this issue,” the official said.  “We will continue our intensive engagement to ensure that the maximum amount of pressure is exerted by the international community against Iran's illicit nuclear program.”

This post was updated at 5:58 p.m.