U.S. Senator Kirk to lead bipartisan effort to Collapse the Central Bank of Iran

92 Senators back the Effort                                                                                                         

 Upcoming Kirk Amendment as IAEA Reports Iran Closing in on a Bomb 

(Update to a previous article) 


Chicago, IL – U.S. Senator Mark Kirk announced he will lead a bipartisan effort to collapse the Central Bank of Iran (CBI).  Building on the consensus built by the August Kirk-Schumer (D-NY) letter to the President cosigned by 92 Senators, Kirk will offer a Senate amendment to enact such sanctions against Iran’s central bank into law.

According to recent reporting by the New York Times, the Obama Administration is considering action against Iran’s Central Bank to increase diplomatic pressure on the government of Iranian President Mahmoud Ahmadinejad.  Senator Kirk’s amendment will be offered during this week’s expected opening of the Senate’s debate of the Fiscal Year 2012 Foreign Operations Appropriations bill.  The debate comes as the International Atomic Energy Agency (IAEA) is expected to issue a damning report this week on Iran’s progress towards a nuclear weapon.

“Soon after an Iranian Revolutionary Guard Corps plot was foiled to blow up a Washington restaurant, the IAEA will report that Iran violated U.N. resolutions by coming close to building nuclear weapons.  We have to use the strongest non-military means available to reduce the coming danger to America, Saudi Arabia and Israel,” said Kirk.  “Following the bomb plot and IAEA report on Iranian atomic developments, it is time for President Obama to join 92 Senators to who back the plan to collapse the Central Bank of Iran.”



 Last week, the House Foreign Affairs Committee unanimously approved two bills strengthening sanctions against Iran:  The Iran Threat Reduction Act (H.R. 1905) and the Iran, North Korea, and Syria Nonproliferation Reform and Modernization Act (H.R. 2105).  As part of H.R. 1905, the House Committee approved the Berman (D-CA) amendment to collapse Iran’s Central Bank.

Specifically, the amendment requires the President to make a determination within 30 days whether the Central Bank is involved in supporting Iran’s WMD or missile programs, including proliferation of WMD to other governments; financing Iran’s procurement of advanced conventional weapons; providing financial services for the Iran’s Islamic Revolutionary Guard Corps (IRGC), or furthering Iran’s support of international terrorism.  If the President determines that the Central Bank of Iran is involved in any of these activities, then he would be required under this amendment to apply sanctions under the International Emergency Economic Powers Act.  This would result in any foreign financial institution involved with the Central Bank of Iran also being blocked from the U.S. economy.

In August, Sen. Kirk, along with Sen. Charles Schumer (D-NY), sent a letter to President Obama urging increased economic sanctions against Iran, including pressuring Iran’s financial system by toppling the Central Bank of Iran (CBI).  The letter, signed by 92 senators, states, “The time has come to impose crippling sanctions on Iran’s financial system by cutting off the CBI.”

In mid-October, Sen. Kirk questioned Administration officials during a Senate Banking Committee hearing entitled, “Addressing Potential Threats from Iran,” with witnesses including Wendy Sherman (Under Secretary of State for Political Affairs), David Cohen (Under Secretary of Treasury for Terrorism and Financial Intelligence) and David Mills (Assistant Secretary of Commerce for Export Enforcement). 

The Central Bank of Iran lies at the center of the Iranian financial system.  This institution oversees Iran’s monetary policy, foreign exchange, and the domestic banking system.  According to the Bank’s own website, it also functions as “banker to the government” by holding national accounts and funding state entities.  As such, it is likely that the Bank facilitates payments for numerous entities designated under US law, including the Islamic Revolutionary Guard Corps (IRGC) and the Quds Force, a special unit of the IRGC that reports directly to the Supreme Leader of Iran Ayatollah Khamenei.  According to U.S. Attorney General Eric Holder, members of the Quds Force are responsible for the failed plot to murder foreign diplomats and Americans on U.S. soil.

The Treasury Department publicly stated that between 2001 and 2006, Iran’s Central Bank facilitated a $50 million payment for Hezbollah.  In March 2008, Treasury Financial Crimes Enforcement Network (FinCen) issued a banking advisory that pointed to the Central Bank as a “money laundering threat involving illicit Iranian activity.”  The Treasury Department designated the Central Bank as a “Specially Designated National” (SDN) in June 2010, but has not taken any action against the Bank or entities that do business with it.

In related news, Iran arrested 70 fashion designers for violations of its law.  This followed Iran’s sentence of actress Marzieh Vafamehr to 90 lashes for appearing uncovered in the Australian-produced film, “My Tehran for Sale.”