The U.S. Congress is very close to sending President Barack Obama a bill designed to sanction Iran's energy industry -- and potentially stop Iranian President Mahmoud Ahmadinejad and his coterie from getting a nuclear bomb. The Iran Refined Petroleum Sanctions Act is taking its final steps toward congressional reconciliation. If passed, the new law will hammer Iran's lucrative energy sector, making it even harder for cash-strapped Tehran to finance its illicit nuclear program.
The act as it stands is an important step. But there's one more thing Congress should do to make sure the law's provisions actually work: hand over responsibility for enforcing sanctions to the Treasury Department instead of Foggy Bottom. This is not an issue of inside-the-Beltway turf wars -- it's about effectiveness. Over the past three decades, the Treasury Department has shown that it's far more capable and willing to enforce sanctions than the State Department is -- and the sanctions in the new law are just too important to risk implementing halfway.
As it stands now, the Treasury Department mostly handles the sanctions portfolio stemming from presidential executive orders. In the case of Iran, it has placed targeted financial sanctions (freezing assets and banning transactions) on several Iranian terrorist groups, following from Executive Order 13224. It has, for example, cut off funds from the Iranian Quds Force, an elite unit within the country's Islamic Revolutionary Guard Corps (IRGC), which was designated as a terrorist entity in 2007.
The broader IGRC was placed on the terrorist list the same year, but it had already been under "smart sanctions" since Executive Order 13382 of 2001. Notorious for cracking down on protesters after last June's sham election, the IRGC is also a dominant player in the Iranian energy industry. In 2006, for example, the IRGC's engineering and construction arm, "Ghorb," received more than $7 billion in energy-related contracts from the regime. And this is where the Treasury sanctions proved especially useful.
Over the last four years, the Treasury Department has sought to financially isolate Ghorb, its leadership, its affiliates, and more than four dozen Iranian entities (including seven large Iranian banks) that play a role in the regime's nuclear, terrorist, and even fiscal activities.
Then there's the behind-the-scenes work of Treasury Undersecretary Stuart Levey. Doggedly determined to thwart Iran's nuclear ambitions, Levey has traveled the world in recent years to convince foreign financial institutions to cut ties with Iran. More than 80 financial institutions have done so. And though Levey alone cannot halt the Iranian nuclear drive, his example makes clear how useful the Treasury Department's work can be.