updated 11/6/2008 4:38:03 PM ET 2008-11-06T21:38:03

The Bush administration moved Thursday to clamp down on Tehran by barring financial institutions from routing certain money transfers through the United States on behalf of Iranian banks, Iran's government and others in the country.

Specifically, the Treasury Department announced that it was revoking Iran's so-called "U-turn" license that until now had allowed for such money transfers under certain conditions.

"This regulatory action will close the last general entry point for Iran to the U.S. financial system," the department said in a release.

Prior to Thursday's action, U.S. financial institutions were allowed to process certain money transfers for Iranian banks and other Iranian customers as long as the payments were initiated offshore by a bank that was not neither Iranian nor American and only passed through the U.S. financial system en route to another offshore bank that was neither Iranian nor American.

"Given Iran's conduct, it is necessary to close even this indirect access," said Stuart Levey, the Treasury Department's under secretary for terrorism and financial intelligence.

The action comes as the Bush administration has repeatedly warned U.S. banks that Iran is using an array of deceptive practices to hide its alleged involvement in nuclear proliferation and terrorist activities. The United States said Iran is resorting to such alleged practices to evade detection and skirt financial sanctions.

The step marks the latest effort to tighten the financial noose on Iran, which the United States accuses of bankrolling terrorism and seeking a nuclear bomb. The United States has already imposed sanctions on several state-run Iranian banks and businesses along with elements of its defense ministry and Revolutionary Guard Corps.

Copyright 2008 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


Discussion comments


Most active discussions

  1. votes comments
  2. votes comments
  3. votes comments
  4. votes comments