President Signs EO Designed to Destroy Value of Iranian Rial Outside Iran

Today the President approved a new Executive Order to further tighten U.S. sanctions on Iran and isolate the Iranian government.

This new action targets Iran’s currency, the rial, by authorizing the imposition of sanctions on foreign financial institutions that knowingly conduct or facilitate significant transactions for the purchase or sale of the Iranian rial, or that maintain significant accounts outside Iran denominated in the Iranian rial. While the rial has lost half of its value since the beginning of 2012 as a result of past sanctions, this is the first time that trade in the rial has been targeted directly for sanctions.

In a background briefing conference call that I participated in, a senior administration official made clear what the administration hopes to accomplish by the new sanctions. He said the administration hopes the EO will cause banks outside of Iran to dump rials and make the rial "essentially unusable outside of Iran."