WASHINGTON: The United States on Tuesday blacklisted a "major network of front companies" that serve Iran's leaders, in a calculated move to hobble the regime's finances and stifle its nuclear ambitions.
The US administration, which is already targeting the Iranian currency, the rial, aims to deprive the Islamic republic of billions of dollars by clamping down on what it said were businesses that circumvent existing sanctions.
It marked a second major move by the White House in as many days, following Monday's unveiling of aggressive new sanctions focused on the rial for the first time and also the auto sector, a key source of jobs and revenue.
The United States has long argued that upping economic pressure on Iran is the best way to frustrate and ultimately halt Tehran's attempts to build an atomic weapon.
The steps taken in Washington this week come just over a week before presidential elections in Iran and follow Tehran's refusal to cede ground in stalled world power talks on its nuclear program.
With western countries fearful Iran is building an atomic bomb, "the window of time is shortening, and the time to really ramp up the pressure is now," the Treasury Department's under secretary for terrorism and financial intelligence, David Cohen, told a Senate panel as he explained how the new sanctions regime would hit Iran's leadership.
"Tehran faces a choice: it can address the call of the international community to give up its nuclear ambitions and be permitted to reintegrate itself diplomatically, economically and financially into the world community, or it can continue down its current path and face ever-growing pressure and isolation."
The Treasury said the 37 companies now blacklisted under The Execution of Imam Khomeini's Order both pull in money from state business for Iran's leaders and work to skirt round international sanctions on the regime.
"EIKO and its subsidiaries -- one that manages and controls EIKO's international front companies, and another that manages billions of dollars in investments -- work on behalf of the Iranian government and operate in various sectors of the Iranian economy and around the world, generating billions of dollars in profits for the Iranian regime each year," the US Treasury said.
The Treasury identified the network for sanctions under a 2012 White House executive order that permits the freezing of any assets held by the Iranian leadership in the United States.
The Treasury said EIKO, established about 10 years ago to manage the investments of Iran's leadership, works through two main holding companies, Tadbir Economic Development Company and Tosee Eqtesad Ayandehsazan or TEACO, which helps the regime subvert sanctions through its network of operating companies in central Europe, Germany, South Africa and United Arab Emirates.
President Barack Obama has now signed nine executive orders on the financial, business and trade restrictions against Iran, and the sanctions are having a potent impact.
They have sent its currency into a tailspin, with the rial losing two-thirds of its value in the past two years.
They have also slashed Iran's crude oil exports by half over the last 18 months, amounting to between $3 billion and $5 billion in lost profits every month, Cohen said.
And yet he recognized that the actions against Tehran have so far failed to jolt the leadership into reversing their nuclear course.
"We have substantially increased the pressure on Iran over the past several years... (but) we have not yet achieved the objective, which is to change the Iran government's calculus," Cohen said.
Under Secretary of State for Political Affairs Wendy Sherman also testified before the Senate Banking Committee, warning that the Iranian leadership's "campaign of repression" against its own people, including crackdowns on dissent, was on the rise ahead of the June 14 presidential elections.