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Iran deal may impact U.S. sanctions investigations

Iran deal may impact U.S. sanctions investigations
Wednesday, November 27, 2013 - 12:47am

 The interim deal to limit Iran's nuclear program casts some uncertainty over how the Justice Department and other agencies investigate alleged sanctions violations.

The deal struck over the weekend between Iran and six world powers, including the United States, gives Iran a temporary respite from some of stringent international economic sanctions that U.S. officials say helped bring Iran to the negotiating table.

The interim agreement could mean new investigations aren't begun while there is some doubt over details around the easing of sanctions, according to law enforcement officials.

Justice Department prosecutors are expected to continue their ongoing cases without interference from political leaders pushing for a long-term agreement.

The Justice Department has well over a dozen cases under investigation related to potential Iran sanctions violations, according to law enforcement officials.

U.S. officials say any legal violations already under investigation aren't affected by the deal and past violations could still be prosecuted.

Justice Department prosecutors brought charges for Iraq sanctions violations years after the United States invaded Iraq in 2003 and dropped sanctions against the deposed Saddam Hussein regime.

Several U.S. agencies, ranging from the Justice and Commerce departments to financial regulators, as well as companies that could potentially do business in Iran are now seeking guidance on how to handle the temporary change, officials said.

The Treasury Department said ongoing sanctions investigations are not affected and it is working on providing some guidance soon on the terms of the relief the Iran agreement allows.

"We will continue to enforce the vast majority of the architecture of our sanctions," a Treasury spokesman said.

After 35 years of hostility, the United States has built a complicated regime of sanctions against the Iranian government.

Many are governed by the International Emergency Economic Powers Act and others fall under executive orders issued by successive presidents.

Sanctions include asset seizures and blacklists targeting dozens of people believed to be associated with Iranian weapons programs.

That complication is one reason why the U.S. delegation to Geneva that negotiated the agreement included the nation's top sanctions expert, Adam Szubin, who heads Treasury's Office of Foreign Assets Control.

U.S. and European allies in recent years have tightened sanctions, seeking to isolate Iran's energy and financial sectors by restricting exports to support Iran's automotive industry and blocking banks and insurance companies from handling transactions related to Iran's oil exports.

Under the agreement, the United States and other nations agreed to temporarily suspend some sanctions affecting Iran's petrochemical and auto industries, meaning insurance companies can now more easily provide coverage for tankers carrying Iranian oil.

But companies would be wise to tiptoe into any risky transactions.

Boyd Johnson, a former New York federal prosecutor and now partner at Wilmer Hale law firm, says he'd advise companies that "it's too early to change their strategy."

Businesses should continue to be vigilant about the major risks in any transactions that could involve Iran, he said.

The government, he said, needs to decide what if anything the temporary deal means for businesses.

"It would be wrong to let down their guard," Johnson said. 

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