U.S. lawmakers target insurers of Iran deals

Thu Mar 8, 2012 4:54pm EST

Related Topics

* Bill seeks even tougher sanctions on Iran

* Would sanction SWIFT work with all Iranian banks

* Similar measure to be introduced in Senate

By Timothy Gardner

WASHINGTON, March 8 (Reuters) - Global companies that insure trade with Iran would be cut off from the U.S. financial system under legislation two lawmakers introduced on Thursday that aims to further tighten the financial noose around Tehran's nuclear program.

Representatives Brad Sherman, a Democrat, and Ileana Ros-Lehtinen, a Republican, introduced the bill that would penalize underwriters that insure deals involving oil and gas investments and shipments from Iran.

"Our goal is to make sure no company in the world will provide shipping insurance to any company in the world that is doing business with Iran," Sherman said in an interview.

The sanctions bill President Barack Obama signed on Dec. 31 was designed to cut funding to Iran's nuclear program by slashing revenues from its oil exports. Washington suspects Iran is trying to make nuclear weapons, while Tehran says its program is purely for civilian purposes.

The new sanctions bill introduced Thursday also seeks to expand efforts to sanction the Society for Worldwide Interbank Financial Telecommunication, or SWIFT, for doing business with all Iranian banks instead of its central banks, as other legislation has targeted.

SWIFT is a global organization that facilitates most of the world's cross border payments.

"The goal here isn't to force the government of Iran to move its account from one bank to another across the street, the goal is to cut them off from the financial system," said Sherman who has advocated for sanctions on Iran since 1998.

Similar measures outlined in the House bill are expected to soon be introduced in the Senate by Senator Mark Kirk.

The insurance measure seeks to go after international companies in Asia and Europe that are still willing to provide reinsurance for Iranian entities, a Congressional aide said.

"This is an important part of a multi-headed hydra of sanctions that we are throwing at Iran," the aide said. "There are always going to be businesses that find loopholes," he said.

The U.S. Energy Information Administration said last week there was evidence over the last two months that some shipments of Iranian oil were already being curtailed due to unwillingness of U.S. and European insurance providers to cover them. (Reporting By Timothy Gardner; Editing by David Gregorio)

FILED UNDER: