S E C R E T STATE 002284

SIPDIS


E.O. 12958: DECL: 01/08/2017
TAGS: PREL KNNP KN PARM FR GE IT UK

SUBJECT: ADDITIONAL IRAN DESIGNATIONS UNDER E.O. 13382


Classified By: Classified by ISN PDAS Patricia A. McNerney,
Reasons: 1.4 (b) and (d).


1. (SBU) This is an action request, please see paragraph 2.

OBJECTIVES
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2. (SBU) Washington requests that addressees provide
courtesy pre-notification OOB, Tuesday, January 9 (local
time) to host government officials that the United States
will designate two additional entities and one individual
under E.O. 13382 ("Blocking the Property of Weapons of Mass
Destruction Proliferators and their Supporters") on January
9, 2007 at 10:30am EST for their support for Iranian entities
engaged in proliferation activities. Host governments should
be informed that this information is embargoed until after
the designations have been publicized in the United States.
Washington informed the Embassies of France, Germany, Italy,
and the United Kingdom of the designations on January 8.
These designations are aimed at protecting the U.S. financial
system from ongoing proliferation financial activity
facilitated by Bank Sepah and persons owned or controlled by,
or acting or purporting to act on behalf of, Bank Sepah.
Addressees are requested to provide the non-paper in
paragraph 4 to host governm
ent officials.

REPORTING DEADLINE
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3. (U) Public announcement of the designation in the U.S.
will occur at January 9, 2007 at 10:30am EST. Please report
delivery of the U.S. non-paper and any immediate response by
January 9, 2007. Please slug replies for ISN, T, TREASURY,
EUR and NEA.


BACKGROUND/NONPAPER
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4. (S/REL TO UK, FRANCE, GERMANY and ITALY) Begin text of
background/non-paper for UK, FRANCE, GERMANY and ITALY:

The U.S. would like to inform your government that the U.S.
Treasury Department will designate two additional entities
and one additional individual for their support for
proliferation activities by Iranian entities pursuant to
Executive Order (E.O.) 13382 ("Blocking the Property of
Weapons of Mass Destruction Proliferators and their
Supporters"), an authority aimed at f

reezing the assets of
proliferators of weapons of mass destruction and their
supporters and prohibiting transactions and trade between
those designated entities and banks in U.S. jurisdiction, on
January 9, 2006.

The United States has used E.O. 13382 to designate eight
other Iranian entities as proliferators or supporters of
proliferation activities.

This information is embargoed until after the publication of
the designations by an official statement from the U.S.
Treasury Department.

The following names will be added to Treasury's Office of
Foreign Assets Control (OFAC) list of Specially Designated
Nationals and Blocked Persons ("SDN list") and published in
the U.S. Federal Register pursuant to Executive Order 13382.


1. BANK SEPAH, Imam Khomeini Square, P.O. Box 11364-9569,
Tehran, Iran: all offices worldwide (NPWMD)


2. BANK SEPAH INTERNATIONAL, PLC, 5/7 Eastcheap, London,
EC3M 1JT, United Kingdom (NPWMD)


3. AHMAD DERAKHSHANDEH, c/o Bank Sepah, No 33 Hormozan
Building, Pirozan St., Sharak Ghods, Tehran, Iran; DOB 11
August, 1956; POB Iran (NPWMD)

Bank Sepah is being designated for providing financial
support and services for three entities previously designated
for proliferation activities under E.O. 13382: the Aerospace
Industries Organization (AIO), the Shahid Hemmat Industries
Group (SHIG), and the Shahid Bakeri Industries Group (SBIG).
Bank Sepah International, PLC, UK and Ahmad Derakhshandeh are
being designated because they are owned or controlled by, or
act or purport to act for or on behalf of, Bank Sepah.

These designations are one part of the U.S. strategy to
counter the proliferation of weapons of mass destruction.

The U.S. action also helps to implement UN Security Council
Resolution 1737, which requires States to prevent assistance
to Iran related to its nuclear and delivery system programs.
As you know, SHIG and SBIG were included in the Annex of
UNSCR 1737.

SBIG is also involved in Iran's missile programs. Among the
weapons SBIG produces are the Fateh-110 missile, with a range
of 200 kilometers, and the Fajr rocket systems, a series of
North Korean-designed rockets produced under license by SBIG
with ranges of between 40 and 100 kilometers. Both systems
are capable of being armed with at least chemical warheads.

SHIG is responsible for some of Iran's ballistic missile
programs, most notably the Shahab series of medium range
ballistic missiles which are based on the North
Korean-designed No Dong missile. The Shahab is capable of
carrying chemical, nuclear, and biological warheads and has a
range of at least 1300 kilometers. SHIG has received help
from Russia, China and North Korea in the development of this
missile.

Both SHIG and SBIG are affiliates of Iran's AIO, which is a
subsidiary of the Iranian Ministry of Defense and Armed
Forces Logistics, and is the overall manager and coordinator
if Iran's missile program. AIO oversees all of Iran's
missile industries. The United States intends to propose the
designation of AIO to the UNSCR 1737 Committee.

One way States should implement the requirements of the
resolution is to refrain from facilitating Iran's nuclear or
missile programs by ceasing dealings with entities involved
in these activities and blocking or seizing accounts or
transactions associated with such programs or activities.

The U.S. actions today are aimed at ensuring that Iranian
entities engaged in ballistic missile proliferation - AIO,
SHIG, and SBIG-are not able to fund these activities using
the U.S. financial system.

It is critical that the international community present Iran
with a consistent and uniform front to press Iran to comply
with its obligations and seek swift, full and effective
implementation of the measures contained in UNSCR 1737 by all
UN members.

We therefore urge your government to undertake similar
actions against Bank Sepah, AIO, SHIG, and SBIG, and to
investigate financial relationships and transactions in which
Bank Sepah and other E.O. 13382 designated Iranian
proliferation entities have an interest.

We look forward to working with you on this and other related
security matters and are prepared to provide additional
assistance as appropriate.

End background/non-paper.

POINT OF CONTACT
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5. (U) Questions may be directed to ISN/CPI (Michelle New,
202-647-0186, or Jennifer Chalmers, 202-647-9715).
RICE


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