Treasury Department Targets Hezbollah's and Iran's Financial Institutions

By Andrew Cochran

In actions announced yesterday and today, the Treasury Department makes it clear that the U.S. will pursue the financial institutions which assist Hezbollah and the Iranian regime. Today, Treasury cut off access to the U.S. financial system by Iran's Bank Saderat, one of Iranian-owned banks, by making it impossible to conduct "U-turn transactions," which allow U.S. banks to process payments involving Iran that begin and end with a non-Iranian foreign bank. The Treasury statement asserts, "The bank is used by the Government of Iran to transfer money to terrorist organizations, including Hizballah, Hamas, the Popular Front for the Liberation of Palestine-General Command and Palestinian Islamic Jihad. A notable example of this is a Hizballah-controlled organization that has received $50 million directly from Iran through Bank Saderat since 2001." Stuart Levey, the senior Treasury anti-terrorist financing official, said, "Bank Saderat facilitates Iran's transfer of hundreds of millions of dollars to Hizballah and other terrorist organizations each year."

This follows yesterday's designation of two financial companies and one individual that provide financial support to Hizballah. The action prohibits any transactions between U.S. persons and the designated entities and also freezes any assets those entites may have under U.S. jurisdiction. From the Treasury press release:

Bayt al-Mal is a Hizballah-controlled organization that performs financial services for the terrorist organization. Bayt al-Mal operates under the direct supervision of Hizballah Secretary General Hasan Nasrallah. As Hizballah's main financial body, Bayt al-Mal serves as a bank, creditor, and investment arm for Hizballah. The central headquarters of Bayt al-Mal was located in Hizballah's stronghold in Beirut's southern suburbs. Bayt al-Mal utilizes the Yousser Company for Finance and Investment to secure loans and finance business deals for Hizballah companies.

Husayn al-Shami, the head of Bayt al-Mal, is a senior Hizballah leader who has served as a member of Hizballah's Shura Council and as the head of several Hizballah-controlled organizations, including the Islamic Resistance Support Organization. Shami is also responsible for foreign donations to Hizballah fundraising organizations.

Under Secretary Levey discussed these actions today at a 9/11-related event in Washington. "It is remarkable that Iran has a nine-digit line item in its budget to support Hizballah, Hamas, and other terrorist organizations at the expense of investing in the future of its young people."

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