If a bank, insurance company, broker or other financial institution does international business, it should carefully examine new regulations that came into effect on August 16, 2010. These regulations, the Iranian Financial Sanctions Regulations (IFSR), 31 C.F.R. Part 561, implement Section 104 of the Comprehensive Iran Sanctions, Accountability, and Divestment Act of 2010, which President Obama signed into law on July 1. See http://www.treas.gov/offices/enforcement/ofac/legal/regs/fr75_49836.pdf.
The IFSR are designed to choke off financial support for Iran, and particularly its nuclear ambitions. The regulations operate either by restricting or outright banning U.S. financial institutions from maintaining correspondent accounts or "payable-through accounts" for foreign financial firms that do business with designated Iranian banks, organizations and individuals. Seeking an extraterritorial impact, the U.S. government hopes that non-U.S. firms will value their access to the U.S. financial system and discontinue targeted types of Iran-related business. On August 17, OFAC updated its SDN list with names and identifiers for 49 persons (individuals and entities) meeting the IFSR criteria. See http://www.treas.gov/offices/enforcement/ofac/actions/20100816.shtml. U.S. financial institutions should begin screening for these entities immediately.
While IFSR are final rules, OFAC has encouraged the submission of comments. Comments are due on October 15, 2010.