United States President Donald Trump must be willing, for sanctions to effectively change Iran’s destabilizing behavior, to sanction the Society for Worldwide Interbank Financial Telecommunication (SWIFT), if it maintains connections with sanctioned Iranian banks in November, Richard Goldberg, a senior adviser at the Foundation for the Defense of Democracies, argued in an op-ed published Wednesday in the New York Post.
SWIFT is an organization that carries messages back and forth between banks. If it does not disconnect access from Iranian banks after November, when the U.S. re-imposes banking sanctions, European nations will be able to sidestep those sanctions by enabling deals between European banks and sanctioned Iranian banks through SWIFT.
Shortly after Trump announced that the U.S. was withdrawing from the nuclear deal in May, the European Commission announced its intent to “evade US sanctions by processing payments to Iran through European central banks,” Goldberg wrote.
In 2012, Congress passed a law allowing the president to sanction members of SWIFT, who violated U.S. sanctions. These sanctions, which Goldberg helped design as a top aide to then-Sen. Mark Kirk (R – Ill.), cut off Iran’s central bank and helped force Iran to negotiate. However, as part of the nuclear deal, Iranian banks once again had access to SWIFT, and Western leverage to force Iran to negotiate or compromise was lost.
Instead of cutting off sanctioned Iranian banks, some are suggesting a compromise plan that would allow SWIFT to penalize only those Iranian banks that violate its standards, and engage in terror-financing and money-laundering. Goldberg dismissed such an arrangement as “a dressed-up version of the status quo and exactly what JCPOA supporters want.”
That Iran’s banks finance terror and other destabilizing activities is well-established. Goldberg observed that in May, Iran’s central bank was sanctioned by the U.S. Treasury Department for its support of the Quds Force and Hezbollah. In June, Treasury official Sigal Mandelker accused Iran’s central bank of financing terror and human rights abuses. European officials have arrested an Iranian diplomat and others for a planned terror attack in Paris this past summer.
“President Trump doesn’t need more information to determine whether Iran’s leaders finance illicit activities,” Goldberg wrote. “He already knows they do. What he needs is maximum pressure to stop them.”
The U.S. Treasury Department has been effective in letting financial institutions around the world know that doing business with Iran will subject them to U.S. sanctions. If it would not treat SWIFT the same way, Treasury “would risk undermining its own credibility.”
If President Trump wants an effective sanctions policy, Goldberg argued, he must insist that SWIFT cut off Iranian banks in November.
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