PARIS, May 19 - U.S. Treasury Secretary Scott Bessent used remarks prepared for an anti-terrorism financing conference to press allies for more aggressive measures against Iran’s funding apparatus and to announce a Treasury review of its sanctions roll to remove obsolete designations.
Bessent told attendees he expected partners to "stand with us in full measure" in confronting Iran. He outlined concrete actions he wants other governments to take, saying, "That will require, for example, our European partners to join the United States in taking action against Iran by designating its financiers, unmasking its shell and front companies, shuttering its bank branches, and dismantling its proxies." He added that governments in the Middle East and Asia must "root out Iran’s shadow banking networks."
The remarks followed a meeting of G7 finance leaders in Paris. Bessent framed the Treasury’s stepped-up measures as part of a broader U.S. effort to pressure Tehran to reopen the Strait of Hormuz to restore oil flows the administration says were disrupted by the U.S.-Israeli attacks on Iran.
Central to those measures is a Treasury initiative known as "Economic Fury," through which officials aim to disrupt Iran’s shadow banking systems. The program has already resulted in the freezing of nearly half a billion dollars worth of cryptocurrency that U.S. officials say was linked to Iran’s regime.
Bessent said the Treasury will modernize its sanctions architecture because "our adversaries adapt and innovate" by establishing new shell companies that seek to evade financial controls. The department’s most commonly used tool is the Specially Designated Nationals List, which contains tens of thousands of designees who are cut off from the dollar-based financial system and whose assets are frozen. The secretary noted that anyone who transacts with designated entities risks sanctions themselves.
To improve the effectiveness of sanctions, Bessent said the Treasury is reviewing outdated and obsolete listings so that financial institutions can concentrate on "the most sophisticated terrorist financing and sanctions evasion schemes." He argued that sanctions should be focused and timely. "Sanctions are meant to change behavior, not to punish populations," he said, warning that "Sanctions left in place for years with no visible and tangible changes in behavior can have generational impacts that are nearly impossible to predict."
Emphasizing flexibility, Bessent said the Treasury’s approach would "maintain agility to maximize effectiveness." He cited the easing of sanctions on Syria and Venezuela following regime changes as examples of how the administration plans to adjust measures when conditions change.
The Treasury’s announced actions underline a two-track strategy: press partners internationally to take direct measures against Iran’s financiers and refine domestic sanctions tools so that enforcement can keep pace with evolving evasion tactics. Financial institutions, regional governments and energy markets are among the parties the Treasury appears to be targeting with these changes, while the review of the sanctions list aims to help banks and compliance teams prioritize the most significant threats.
How these initiatives will play out depends on multilateral cooperation and the Treasury’s ability to rapidly remove outdated designations without creating gaps that could be exploited by those seeking to evade enforcement.