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U.S. Treasury Seeks To Reassure Banks Wary Of Dealing With Iran

U.S. Treasury Secretary Jack Lew published guidance designed to clarify when banks can use U.S. dollars in transactions with Iran.

The U.S. Treasury is seeking to reassure banks that have been unwilling to do business with Iran, but Tehran says the effort has not gone far enough.

New guidance issued over the weekend after months of complaints from Tehran clarifies that non-U.S. banks can do business with Iran in U.S. dollars, provided those transactions don't pass through financial institutions in the United States.

A Treasury spokeswoman said on October 10 that the department is not providing new sanctions relief but is clarifying how remaining U.S. sanctions on Iran are applied to deals authorized by last year's nuclear agreement.

Tehran charged that the guidelines do not go far enough to dispel worries among businesses that dollar transactions, even if initially made offshore, will eventually transit through American banks and violate U.S. sanctions.

Those worries have prevented most Western banks from resuming business with Iran to date.

"The problems that existed before are still there," Iranian minister Hossein Ghazavi told the Iranian Students News Agency.

"Previously...non-American financial institutions could not have 100 percent confidence that while providing brokerage services, creating accounts, or maintaining U.S. dollars for Iranian banks and customers, they wouldn't face unpredictable risk. This ambiguity has still not been resolved."

Based on reporting by AP and Reuters