Clinton says US moving on Iran sanctions

[February 29, 2012]  WASHINGTON (AP) -- Secretary of State Hillary Rodham Clinton insists the Obama administration is moving swiftly to impose tough new sanctions on Iran amid concerns in Congress that the White House won't be aggressive enough in cracking down on financial institutions that do business with Tehran's Central Bank.

"What we are intending to do is to ratchet up these sanctions as hard and fast as we can, follow what's going on inside Iran, which seems to be a lot of economic pressures that we think does have an impact on decision-making," Clinton told the Senate Foreign Relations Committee on Tuesday.

The first round of penalties under the far-reaching defense bill that President Barack Obama signed into law on Dec. 31 goes into effect Wednesday, and lawmakers expected an announcement from the administration on the steps it plans to take to thwart Iran's disputed nuclear program. The United States, the European Union and others have slapped a rapid series of sanctions on Tehran; Congress added to the penalties late last year.

The law says that 60 days after enactment, the president must impose sanctions on any privately owned foreign financial institutions that knowingly conduct or facilitate any significant financial transaction with the Central Bank of Iran for any purpose other than the purchase of petroleum or petroleum products from Iran.

In a fact sheet issued this week, the Treasury Department said the regulations "contain various time-based triggers for the imposition of sanctions, beginning Feb. 29, subject to certain exceptions authorized by the statute."

Clinton said the administration and Congress were on the same page regarding Iran and sanctions.

"The administration has been unequivocal about its policy toward Iran. With your good work and our efforts, we have passed the Menendez-Kirk sanctions. We are implementing those sanctions. There has never been anything like them that the world has ever agreed upon," she told the committee. "We are diligently reaching out around the world to get agreements from countries for whom it's quite difficult to comply with our sanctions. But they are doing the best they can. ... We are focused on the toughest form of diplomacy and economic pressure to try to convince Iran to change course, and we have kept every option on the table."

Sens. Bob Menendez, D-N.J., and Mark Kirk, R-Ill., pushed for the sanctions in the defense bill, and in a rare unanimous vote, the Senate backed them 100-0. During Clinton's testimony, Menendez pressed her on the administration's enforcement of the new sanctions. Menendez raised concerns about the criteria the administration was using to determine whether a country had achieved significant reductions in the purchase of petroleum.

The Energy Information Administration is scheduled to issue both a classified and unclassified report Wednesday on the availability and supply of non-Iranian-produced oil, reflecting the current production rate and the total reserve. The report will be the basis for whether the administration proceeds with the next round of sanctions.

"Can I presume that in the absence of a national security waiver under the law, that all countries will be required to actually make significant reductions in their purchases during each of the 180-day period?" Menendez asked.

Clinton said the administration expects to see significant reductions.

"We've been aggressively reaching out to and working with countries to assist them in being able to make such significant reductions," she said. Clinton said the administration has had "very intense and very blunt" conversations with India, China and Turkey.

"Both on their government side and on their business side, they are taking actions that go further and deeper than perhaps their public statements might lead you to believe and we're going to continue to keep an absolute foot on the pedal in terms of our accelerated aggressive outreach to them. And they, you know, they are looking for ways to make up the lost revenues, the lost crude oil," Clinton said.

An outside sanctions expert who has advised the administration said there were plenty of examples of foreign companies engaging in transactions that would be subject to sanctions beginning Wednesday.

If the administration takes no public action against those companies now it would be a lost opportunity to show resolve ahead of next week's meeting between Obama and Israeli Prime Minister Benjamin Netanyahu, said Mark Dubowitz, executive director of the nonprofit Foundation for Defense of Democracies.

"They should do something," Dubowitz said. "There is ample authority and you have a target-rich environment."

[Associated Press; By DONNA CASSATA]

AP National Security Writer Anne Gearan contributed to this report.

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