On October 25, 2007, the U.S. Government took several major steps to counter the Iranian regime’s bid for nuclear capabilities and support for terrorism by designating the Islamic Revolutionary Guards Corps (IRGC) and its terrorist arm, the Qods (Jerusalem) Force and a number of state-owned banks, companies and officials under two different Executive Orders by President Bush.
The move represents as a major policy shift by the United States as it is the first practical and concrete action which targets the pillar of the Iranian regime. Despite harsh anti-Tehran rhetoric from Washington in the past two decades, this is the first time punitive measures are taken against probably the most important military and financial institution, which has now expanded its sphere of influence in the political leadership of the regime.
The Department of State designated under Executive Order 13382 two key entities of proliferation concern: the Islamic Revolutionary Guard Corps (IRGC) and the Ministry of Defense and Armed Forces Logistics (MODAFL). Additionally, the Department of the Treasury designated for proliferation activities under E.O. 13382 nine IRGC-affiliated entities and five IRGC-affiliated individuals, Iran’s state-owned Banks Melli and Mellat, and three individuals affiliated with Iran’s Aerospace Industries Organization (AIO).
The Treasury Department also designated the IRGC-Qods Force (IRGC-QF) under E.O. 13224 for providing material support to the Taliban and other terrorist organizations, and Iran regime’s state-owned Bank Saderat as a terrorist financier.
As a result of these actions, all transactions involving any of the designees and any U.S. person will be prohibited and any assets the designees may have under U.S. jurisdiction will be frozen.
Executive Order 13382 signed by President Bush on June 29, 2005, is an authority aimed at freezing the assets of proliferators of weapons of mass destruction and their supporters, and at isolating them from the U.S. financial and commercial systems.
The Islamic Revolutionary Guard Corps (IRGC) is composed of five branches (Ground Forces, Air Force, Navy, Bassij militia, and Qods Force special operations) in addition to a counterintelligence directorate and representatives of the Supreme Leader, Ali Khamenei. It has numerous economic interests involving defense production, construction, and the oil industry.
The IRGC has been working extensively to proliferate ballistic missiles capable of carrying WMD. It is also one of the primary organizations tied to developing and testing the Shahab-3. The IRGC attempted, as recently as 2006, to procure sophisticated and costly equipment that could be used to support Iran’s ballistic missile and nuclear programs.
The Ministry of Defense and Armed Forces Logistics (MODAFL) controls the Defense Industries Organization, an Iranian entity involved in missile technology proliferation activities.
MODAFL has ultimate authority over Iran’s Aerospace Industries Organization (AIO), which was designated under E.O. 13382 on June 28, 2005. The AIO is the Iranian organization responsible for ballistic missile research, development and production activities and organizations, including the Shahid Hemmat Industries Group and the Shahid Bakeri Industries Group. Defense Minister Brigadier General Mostafa Mohammad Najjar said that one of MODAFL’s major projects is the manufacturing of Shahab-3 missiles and that it will not be halted. MODAFL representatives have brokered a number of transactions involving materials and technologies with ballistic missile applications.
Bank Melli, its branches, and subsidiaries: Bank Melli is Iran’s largest bank. It provides banking services to entities involved in Iran’s nuclear and ballistic missile programs. Through its role as a financial conduit, Bank Melli has facilitated numerous purchases of sensitive materials for Iran’s nuclear and missile programs. In doing so, Bank Melli has provided a range of financial services on behalf of Iran’s nuclear and missile industries, including opening letters of credit and maintaining accounts.
Bank Melli also provides banking services to the IRGC and the Qods Force. Entities owned or controlled by the IRGC or the Qods Force use Bank Melli for a variety of financial services. When handling financial transactions on behalf of the IRGC, Bank Melli has employed deceptive banking practices to obscure its involvement from the international banking system. For example, Bank Melli has requested that its name be removed from financial transactions.
Bank Mellat, its branches, and subsidiaries: Bank Mellat provides banking services in support of Iran’s nuclear entities, namely the Atomic Energy Organization of Iran (AEOI) and Novin Energy Company. Bank Mellat services and maintains AEOI accounts, mainly through AEOI’s financial conduit, Novin Energy. Bank Mellat has facilitated the movement of millions of dollars for Iran’s nuclear program since at least 2003. Transfers from Bank Mellat to Iranian nuclear-related companies have occurred as recently as this year.
Support for Terrorism — Executive Order 13224 Designations E.O. 13224 is an authority aimed at freezing the assets of terrorists and their supporters, and at isolating them from the U.S. financial and commercial systems. Designations under the E.O. prohibit all transactions between the designees and any U.S. person, and freeze any assets the designees may have under U.S. jurisdiction.
The Qods Force, a branch of the IRGC, provides material support to the Taliban and Lebanese Hizballah, among others.
The Qods Force is the Iranian regime’s primary instrument for providing lethal support to the Taliban. The Qods Force provides weapons and financial support to the Taliban to support anti-U.S. and anti-Coalition activity in Afghanistan. Since at least 2006, Iran has arranged frequent shipments of small arms and associated ammunition, rocket propelled grenades, mortar rounds, 107mm rockets, plastic explosives, and probably man-portable defense systems to the Taliban.
In addition, the Qods Force provides lethal support in the form of weapons, training, funding, and guidance to select groups of Iraqi Shi’a militants who target and kill Coalition and Iraqi forces and innocent Iraqi civilians.
The Qods Force has had a long history of supporting Hizbollah’s military, paramilitary, and terrorist activities, providing it with guidance, funding, weapons, intelligence, and logistical support.
Bank Saderat, which has approximately 3200 branch offices, has been used to channel funds to terrorist organizations, including Hizbollah. For example, from 2001 to 2006, Bank Saderat transferred $50 million from the Central Bank of Iran through its subsidiary in London to its branch in Beirut for the benefit of Hizballah fronts in Lebanon.
Ali Safavi, of the National Council of Resistance of Iran, is President of Near East Policy Research, a policy analysis firm in Washington, DC.