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Briefing | New US Sanctions Target 50 Iranian Firms and Individuals

13 Jul 2012 01:55Comments

Treasury undersecretary: "We will continue to ratchet up the pressure."

ArdabilSubsidizedFood.jpg[ briefing ] On Thursday, the United States announced broad new sanctions on a "group of Iranian front companies and banks" and several individuals; of the 50 targeted firms and persons, 11 entities and four individuals are claimed to be linked to the proliferation of nuclear and missile programs in the Islamic Republic, while the remainder are cited for their claimed roles in the "circumvention of international sanctions on Iran." Following is, first, the U.S. Treasury Department statement announcing the measures and, second, an edited version of Treasury's detailed fact sheet, the complete version of which is available for download here. -- The Editors

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WASHINGTON -- Today, the United States is imposing additional sanctions on Iran's nuclear and ballistic missile proliferation networks, and is also taking additional steps to prevent the evasion of sanctions by publicly identifying a group of Iranian front companies and banks. These actions are part of the United States government's dual-track approach of increasing pressure to convince Iran to engage seriously and address the international community's concerns about its nuclear program.

"Iran today is under intense, multilateral sanctions pressure, and we will continue to ratchet up the pressure so long as Iran refuses to address the international community's well-founded concerns about its nuclear program," said Treasury Under Secretary for Terrorism and Financial Intelligence David S. Cohen. "Today's actions are our next step on that path, taking direct aim at disrupting Iran's nuclear and ballistic missile programs as well as its deceptive efforts to use front companies to sell and move its oil."

Targeting Iran's nuclear and missile proliferation activities

Since 2005, the United States has imposed a series of targeted, conduct-based sanctions under Executive Order (E.O.) 13382, "Blocking Property of Weapons of Mass Destruction Proliferators and Their Supporters," on persons, firms and financial institutions involved in Iran's nuclear and ballistic missile programs. This sustained sanctions effort has both disrupted the progress of Iran's nuclear and ballistic missile program and imposed significant pressure on the Iranian government.

Continuing the effort to target Iran's nuclear and missile proliferation activities, the U.S. Departments of the Treasury and State are today designating 11 entities and four individuals under E.O. 13382. As described in more detail in the accompanying Fact Sheet, many of the individuals and entities designated today are part of a network of proliferators headed by Iran's Ministry of Defense for Armed Forces Logistics (MODAFL) and its subsidiary, Aerospace Industries Organization (AIO). A number of additional designations are related to Iran's national maritime carrier, Islamic Republic of Iran Shipping Lines (IRISL), and Iran's Islamic Revolutionary Guard Corps (IRGC), both of which have been the target of a numerous sanctions actions by the United States and our partners around the world.

Preventing the circumvention of international sanctions on Iran

The Treasury Department is also acting today to prevent the circumvention of international sanctions on Iran -- including sanctions on oil trade with Iran -- by publicly exposing numerous Iranian front companies, ships and banks that are part of the Government of Iran. The specific entities identified in today's action are described in the accompanying Fact Sheet.

Treasury is identifying these Government of Iran entities pursuant to E.O. 13599, which blocks all property and interests in property within U.S. jurisdiction of the Government of Iran and of all Iranian financial institutions, and prohibits U.S. persons or those within U.S. jurisdiction from having dealings with them. To assist U.S. persons in complying with their obligation to freeze the assets of, and not to deal with, any such entities, the Treasury Department from time to time identifies entities that are owned or controlled by, or acting for or on behalf of, the Government of Iran.

Today's identifications include four front companies for the Naftiran Intertrade Company (NICO) or the National Iranian Oil Company (NIOC) -- Petro Suisse Intertrade Company SA; Hong Kong Intertrade Company; Noor Energy (Malaysia) Ltd.; and Petro Energy Intertrade Company. NICO intended to use Petro Energy Intertrade to evade western sanctions. The Treasury Department identified NICO and NIOC, both of which are centrally involved in the sale of Iranian oil, in 2008 as entities that are owned or controlled by the Government of Iran.

The Treasury Department is also identifying today the National Iranian Tanker Company (NITC) as a Government of Iran entity and, for the first time, the NITC fleet and various front companies belonging to NITC. In addition, the Treasury Department is also identifying 20 Iranian financial institutions for inclusion on its List of Specially Designated Nationals and Blocked Persons (SDN List).

These identifications highlight Iran's attempts to evade sanctions through the use of front companies, as well as its attempts to conceal its tanker fleet by repainting, reflagging, or disabling GPS devices. They will assist U.S. persons in complying with E.O. 13599, and will also assist persons and entities around the world in complying with U.S. and international sanctions, including the European Union's prohibition on the import of Iranian oil that went into effect on July 1, 2012.

U.S. persons are generally prohibited from engaging in any transactions with individuals or entities blocked pursuant to E.O 13382 or E.O. 13599, and any assets such persons may have under U.S. jurisdiction are blocked. Entry into the United States of aliens designated pursuant to E.O. 13382 is suspended under Presidential Proclamation 8693, Suspension of Entry of Aliens Subject to U.S. Security Council Travel Ban and International Emergency Economic Powers Act Sanctions.

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Fact Sheet: Increasing Sanctions against Iran

I. Targeting Iran's Nuclear and Missile Proliferation Activities

One set of today's actions target Iran's nuclear and missile proliferation activities by designating entities and individuals that are part of the international procurement and nuclear proliferation operations of Iran's Ministry of Defense for Armed Forces Logistics (MODAFL); Aerospace Industries Organization (AIO); Iran's national maritime carrier, Islamic Republic of Iran Shipping Lines (IRISL); and Iran's Islamic Revolutionary Guard Corps (IRGC) -- all of which have been previously designated under Executive Order (E.O.) 13382, "Blocking Property of Weapons of Mass Destruction Proliferators and Their Supporters." Treasury today is also updating the identifying information for 57 vessels affiliated with IRISL that had been renamed or reflagged since they were originally designated by Treasury, and identifying seven vessels affiliated with IRISL that have not been identified previously. U.S. persons are generally prohibited from engaging in any transactions with individuals or entities designated pursuant to E.O 13382, and any assets the designees may have under U.S. jurisdiction are blocked.

Designations related to MODAFL and AIO

Iran's Ministry of Defense for Armed Forces Logistics (MODAFL) oversees Iran's ballistic missile program. It is designated by the United States pursuant to E.O. 13382 in 2007, and has brokered a number of transactions involving materials and technologies with ballistic missile applications. Aerospace Industries Organization (AIO), a subsidiary of MODAFL, oversees all of Iran's missile industries and was listed in the Annex to E.O. 13382. Today's MODAFL- and AIO-related designations under E.O. 13382 include:

Electronic Components Industries Co. (ECI) and Information Systems Iran (ISIRAN)

Electronic Components Industries Co. (ECI) and Information Systems Iran (ISIRAN) are being designated pursuant to E.O. 13382 because they are owned or controlled by Iran Electronics Industries (IEI), which was designated pursuant to E.O. 13382 in 2008 for being owned or controlled by MODAFL. IEI offers a diversified range of military products including electro-optics and lasers, communication equipment, telecommunication security equipment, electronic warfare equipment, new and refurbished radar tubes, and missile launchers. IEI manufactures military tactical communication systems and also electronic field telephones and switchboards.

ECI conducts work on military and civilian projects, to include semi-conductors, multilayer single and double sided printed circuit boards, hybrid circuits, quartz crystals and oscillators, high purity oxygen and nitrogen gases, micromodules and electronic ceramics.

ISIRAN is one of the largest and most experienced information technology companies in Iran with expertise in building mainframes, minicomputers and PC hardware, software and maintenance as well as total solution turn-key projects.

Advanced Information and Communication Technology Center

Advanced Information and Communication Technology Center (AICTC) is being designated pursuant to E.O. 13382 because it has provided technological or other support for, or services in support of ISIRAN. According to information available from computers abandoned by Hamid Reza Rabiee in the United States, AICTC executes work projects on behalf of ISIRAN. AICTC has five research groups in the fields of Enterprise Software Solutions, Multimedia Systems, Mobile Value-Added Services, Wireless and P2P Networks and Bioinformatics. It also does work on GIS/GPS based tracking systems and more.

Hamid Reza Rabiee

Hamid Reza Rabiee, a software engineer, is being designated pursuant to E.O. 13382 for acting or purporting to act for or on behalf of AICTC. According to information available from computers abandoned by Rabiee in the United States, he has coordinated directly with ISIRAN to establish and execute contracts benefitting ISIRAN. Rabiee is the chief architect and founder of AICTC, and is the current director of the organization.

Digital Media Lab (DML) and Value-Added Services Laboratory (VASL)

Digital Media Lab (DML) and Value-Added Services Laboratory (VASL) were designated for being owned or controlled by, or acting or purporting to act for or on behalf of Hamid Reza Rabiee and AICTC. According to publicly available information, Rabiee is the founder and director of DML and VASL.

Ministry of Defense Logistics Export (MODLEX)

MODLEX is being designated pursuant to E.O. 13382 because it is owned or controlled by, or acts or purports to act, for or on behalf of, MODAFL. As MODAFL's primary exporting entity since 2009, MODLEX was involved in the trade of exportable military products to countries including Sri Lanka, Sudan, Burma, Bangladesh and Nigeria, all in contravention of UNSCR 1747 (2007). UNSCR 1747 prohibits Iran from selling any arms or related material. MODLEX represents Iran at arms trade fairs worldwide advertising Iranian military products for sale. MODLEX also conducts limited procurement activities on behalf of MODAFL elements such as Iran's Defense Industries Organization (DIO), AIO, and Shahid Bakeri Industrial Group (SBIG). Both DIO and SBIG are sanctioned under UNSCR 1737 for their links to Iran's missile program through MODAFL and AIO, respectively.

The Annex to UNSCR 1929 (2010) lists MODLEX as an entity involved in Iran's nuclear or ballistic missile activities and identified MODLEX as being owned or controlled by MODAFL.

Daniel Frosch and International General Resourcing FZE

Daniel Frosch is being designated pursuant to E.O. 13382 for providing or attempting to provide material support for AIO.

Daniel Frosch for several years has shown a steady pattern of providing support to Iran's missile program, including Shahid Hemmat Industrial Group (SHIG) and SBIG, by supplying it with sensitive material. He started dealing with Iran's missile industry while in his home country of Austria, under his now defunct company Daniel Frosch Exports. He moved to the United Arab Emirates (UAE) in 2006, where he continued supporting Iran's weapons programs. Frosch has supplied Iran's missile industry with a wide range of goods, including electronics, testing equipment, and raw materials such as graphite with potential applications in Iran's ballistic missile program. Frosch is the owner of International General Resourcing FZE, located in the UAE.

SHIG was identified in the Annex to E.O. 13382 and is tied to Iran's ballistic missile research, development, and production activities. SHIG was also listed in the Annex to UNSCR 1737.

Malek Ashtar University

Malek Ashtar University is being designated pursuant to E.O. 13382 for being owned or controlled by MODAFL. Malek Ashtar University was established in 1986 by Iran's Ministry of Higher Education and the Supreme Council of the Cultural Revolution, and it is one of the major research institutes and educational centers contained under the MODAFL umbrella.

Malek Ashtar University was identified in the Annex to UNSCR 1929 because it is a subordinate of the Defense Technology and Science Research Center (DTSRC) within MODAFL. The European Union designated Malek Ashtar University on June 24, 2008, because Malek Ashtar University is linked to MODAFL. The University also created a missile training program in 2003 in close collaboration with AIO.

Actions related to Islamic Republic of Iran Shipping Line (IRISL)

IRISL, Iran's national maritime carrier, was designated by Treasury pursuant to E.O. 13382 in September 2008 for its provision of logistical services to MODAFL.

Good Luck Shipping

Good Luck Shipping (GLS), which is located in the UAE, is being designated pursuant to E.O. 13382 because it acts or purports to act for or on behalf of IRISL. GLS was established to replace Great Ocean Shipping Services, which was designated pursuant to E.O. 13382 in June 2011.

Great Ocean Shipping Services (Great Ocean), along with Oasis Freight Agency LLC (Oasis) and Pearl Ship Management LLC (Pearl), are being removed from the SDN List because they were liquidated and struck from the Dubai, UAE commercial register. Great Ocean was designated in June 2011 for acting for or on behalf of IRISL affiliate Oasis and/or IRISL. Oasis was designated pursuant to E.O. 13382 in September 2008 for being owned or controlled by, or acting or purporting to act for or on behalf of, directly or indirectly, IRISL. Pearl was also designated in June 2011 for acting for or on behalf of Oasis and/or IRISL.

Identification of Renamed, Reflagged Vessels and Additional IRISL Vessels

Today, Treasury updated its List of Specially Designated Nationals and Blocked Persons (SDN List) entries for 57 vessels affiliated with IRISL that, since their original identification, have been renamed and/or reflagged by IRISL and its affiliates. OFAC is also identifying 7 additional vessels as blocked property in which IRISL has an interest. Including today's additions, Treasury has identified 155 ships as blocked property in which IRISL or designated IRISL affiliates have an interest.

Designation of IRGC officer

The IRGC was designated pursuant to E.O. 13382 in 2007 for having engaged, or attempting to engage, in proliferation-related activities. The IRGC continues to be a primary focus of U.S. and international sanctions against Iran because of the central role it plays in Iran's ballistic missile and nuclear programs and its involvement in serious human rights abuses.

Ali Fadavi

Islamic Revolutionary Guard Corps (IRGC) Navy Commander Ali Fadavi is being designated under E.O. 13382 for acting or purporting to act for or on behalf of, directly or indirectly, the IRGC. Fadavi was appointed by the Supreme Leader Khamenei as the new IRGC Navy Commander on May 3, 2010. On September 21, 2010, the Defense Ministry of Iran announced that it had delivered the third generation of the domestically designed and manufactured Fateh-110 high-precision ballistic missiles to the IRGC. Fadavi was present at the ceremony where the missiles were delivered. In November 2010 under Fadavi's leadership, the IRGC Navy organized and trained around 60,000 Basij students who received instruction in techniques aimed to confront enemies of Iran. Fadavi claimed that around 100,000 students had become members of the Shahid Fahmideh Rahrovan camp of Basij forces in Bandar Abbas after the launch of the education project.

The European Union designated Fadavi on July 26, 2010, pursuant to European Union Council authorities, for his role as an IRGC Navy Commander.

Designation of nuclear procurement entities

Pentane Chemistry Industries
Pentane Chemistry Industries (PCI) is being designated for engaging or attempting to engage in activities that have materially contributed to, or posed a risk of contributing to, the development of Iran's Weapons of Mass Destruction (WMD) programs.

PCI is an Iranian entity involved in building distillation columns for the production of heavy water for use in Iran's IR-40 heavy water reactor, under construction in Arak, Iran. Since late 2009 PCI has been in charge of the distillation column project at this reactor. PCI has also attempted to procure phosphor bronze mesh as recently as July 2011. Phosphor bronze mesh can be used in distillation columns for final enrichment of heavy water. PCI began manufacturing phosphor bronze mesh screens for the distillation columns in March 2012. Chemically treated phosphor bronze, when knitted into mesh screens, will be used as packing in the IR-40 distillation columns.

Hossein Tanideh

Hossein Tanideh was a procurement agent for Iran's nuclear program through late 2011. He was the Vice President of Iran's Pentane Chemistry Industries Board of Directors as well as Managing Director of the Sherkate Sakhtemani Rahtes Sahami Company (also known as the Rahtes Company). Tanideh in 2010 and 2011 attempted to procure items for probable use in distillation columns for Iran's 40-megawatt heavy water research reactor.

Center for Innovation and Technology Cooperation

The Center for Innovation and Technology Cooperation (CITC) is in a position to support a range of Iran's weapons of mass destruction (WMD) and military procurement objectives. It has been assessed that CITC facilitates procurement and technology transfer from the science community to the military services.

II. Preventing the Circumvention of International Sanctions

To prevent the circumvention of international sanctions on Iran, including sanctions on oil trade with Iran, Treasury is publicly exposing numerous entities that are part of the Government of Iran. Treasury is identifying these Government of Iran entities pursuant to E.O. 13599, which blocks all property and interests in property within U.S. jurisdiction of the Government of Iran and of Iranian financial institutions, and prohibits U.S. persons or those within U.S. jurisdiction from having dealings with them. These identifications are being issued to assist U.S. persons in complying with E.O. 13599, but are not required for E.O. 13599 to apply. Every entity that meets the definition of Government of Iran or an Iranian financial institution under E.O. 13599 is blocked, regardless of whether it has been identified and added to the SDN List. Today's actions include:

Exposing front companies involved in Iran's oil trade

Aiming to undercut Iran's attempts to obscure Iran's petroleum trade in the face of increasing international sanctions, Treasury is identifying Petro Suisse Intertrade Company SA (Petro Suisse), an entity incorporated in Switzerland; Hong Kong Intertrade Company, a Hong Kong-based entity; Noor Energy (Malaysia) Ltd, an entity incorporated in Malaysia; and Petro Energy Intertrade Company, an entity operating out of Dubai, as blocked pursuant to E.O. 13599 because they are owned or controlled by, or acting for or on behalf of, the Government of Iran. Each of these entities are front companies for the National Iranian Oil Company (NIOC), Naftiran Intertrade Company Ltd. (NICO), or Naftiran Intertrade Co. (NICO) Sarl (NICO Sarl).

Prior to the issuance of E.O. 13599, Iran's NIOC, NICO, and NICO Sarl, a Swiss subsidiary of NICO, were identified in 2008, by OFAC as entities that are owned or controlled by the Government of Iran within the meaning of the Iranian Transactions Regulations. U.S. persons are generally prohibited from engaging in any transactions with NIOC, NICO, and NICO Sarl, without authorization from OFAC.

Identification of additional Iranian financial institutions

The 20 Iranian financial institutions identified in today's action constitute new additions to the SDN List that were blocked pursuant to E.O. 13599 on February 5, 2012. Three of the entities identified today have previously been designated by Treasury's Office of Foreign Assets Control (OFAC) under other authorities, and their entries on the SDN List have been updated to reflect their status as Iranian financial institutions.

These identifications, which include the publication of the names and aliases of the Iranian financial institutions, are intended to aid the public in meeting its obligations under E.O. 13599.

Identification of NITC vessels

Treasury is identifying 58 National Iranian Tanker Company (NITC) vessels, as well as NITC and 27 of its affiliated entities, as blocked or "frozen" pursuant to E.O. 13599. The NITC entities have been identified as Government of Iran entities, and the NITC vessels have been identified as property of the Government of Iran. These identifications will aid companies and individuals in complying with sanctions against the Government of Iran and undermine Iran's attempts to use NITC front companies or renamed vessels to evade sanctions.

Copyright © 2012 Tehran Bureau

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