U.S. Sanctions Syrian Bank to Isolate Assad Regime

30 May 2012

A bank employee holds packets of Syrian currency.

The United States has taken new action to isolate Syria’s Assad regime from the international financial system by sanctioning the Syria International Islamic Bank (SIIB).

The U.S. Department of the Treasury announced May 30 that it had sanctioned the bank for acting for or on behalf of the Commercial Bank of Syria and providing services to the Syrian Lebanese Commercial Bank, both of which are subject to U.S. and international sanctions.

“Today’s action will add to the economic pressure on the Assad regime by closing off a key evasion route,” said Under Secretary of the Treasury for Terrorism and Financial Intelligence David S. Cohen.

“The Treasury Department, working with others around the world who share our goal of ending the brutal repression of the Syrian people, will continue to close off the Assad regime’s access to the international financial system,” Cohen said.

SIIB has acted as a front for the Commercial Bank of Syria, which has allowed that bank — Syria’s largest commercial bank — to circumvent sanctions against it by the United States, the European Union and the Arab League.

The executive order on which the sanctions are based aims to freeze the assets of proliferators of weapons of mass destruction and their supporters and isolate them from the U.S. financial and commercial systems. The sanctions generally prohibit transactions between the designees and any U.S. person and freeze any assets the designees may have under U.S. jurisdiction.

SIIB was established in Damascus in September 2007 and has 20 branches and three representative offices throughout Syria. From 2011 to 2012, SIIB surreptitiously facilitated financing worth almost $150 million on behalf of the Commercial Bank of Syria. Financial arrangements that were purportedly made by SIIB were actually made by the Commercial Bank of Syria.

In addition to working with the Commercial Bank of Syria to circumvent sanctions, in 2012, SIIB facilitated several substantial payments for the Syrian Lebanese Commercial Bank and facilitated a payment from this bank, which has also been sanctioned, to “an entity of proliferation concern,” a Treasury Department news release said.

The Treasury Department sanctioned the Commercial Bank of Syria and its subsidiary, Syrian Lebanese Commercial Bank, based on the Commercial Bank of Syria’s support to entities related to Syrian and North Korean proliferation of weapons of mass destruction.

The Treasury Department said it is working closely with partners in the international community to isolate the Assad regime. The United States consulted with the government of Qatar regarding the most recent sanctions, and Qatar is taking corresponding actions.

“We commend the Government of Qatar for its important regional and international role in maintaining economic pressure on the Assad regime. Today's action does not target the Qatari investors who hold investments in SIIB,” the Treasury Department said.

On June 6, Treasury will host in Washington the second meeting of the Friends of the Syrian People International Working Group on Sanctions. The meeting, which the United States will co-chair with the governments of Turkey and Qatar, will focus on ways to further strengthen international sanctions against the Syrian regime.

More information is available on the Treasury Department website.