US News
US targets Iranian state bank
By DPA
Sep 8, 2006, 19:00 GMT

Washington - The US government on Friday announced that it has banned an Iranian-owned bank, Bank Saderat, from having any direct or indirect ties to US financial institutions.

The US Treasury Department said the bank is used to transfer funds to terrorist groups like Lebanon-based Hezbollah and Palestinian militants.

'It is remarkable that Iran has a nine-digit line item in its budget to support terrorism,' said Stuart Levey, the department's undersecretary for terrorism and financial intelligence.

Hezbollah has received 50 million dollars in transfers though Bank Saderat since 2001, the department said.

Under strict US sanctions on Iran that have been in place since the 1980s, US banks were permitted to handle transactions that involved an Iranian bank provided the transaction began and ended with a non-Iranian entity, known as 'U-turn' deals.

'By prohibiting U-turn and all other transactions with Bank Saderat, the bank is denied all direct and indirect access to the US financial system,' Levey said.