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tv   State Department Official on Sanctions Policy  CSPAN  March 9, 2020 12:16pm-1:28pm EDT

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we view not just as a comfort issue and a value issue but more important as a health issue due to deep vein thrombosis and safety due to evacuation issues. i touched on in march the testing done by the faa down in oklahoma city right now is not suv. the there is sufficient evidence they are not reflecting real world scenario and seats is related to that. >> i'll speak to that. in oklahoma the faa tests are not what they could be but in the opposite direction is they're using older full size seats not the slim line seats utilized from airlines. it is about total aavailable space to passenger comfort and what i like about the new seats instead of the thick styrofoam which is a flotation device is made of space age --
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>> my name is toby dershowitz and i'm the senior vice president for government relations and strategy. as many of you know, fdd is a nonpartisan policy institute focusing on national security issues. we are a source for are research and analysis and policy options for congress, for the administration, and for the media and certainly for the wider national security community. we take no foreign government or foreign corporate funding and never will. to learn more about fdd, please visit i want to welcome the online live stream audience and also those watching on c-span today. we invite everyone to join in on the conversation which will be live tweeting @fdd. today's event is hosted by fdd center on economic and financial power. cefp provised recommendations to policymakers on how the u.s. can
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leverage its economic and financial power to achieve its national security objectives. in a moment we'll hear from our features speaker, david peyman for counter threat finance and sanctions. he overseed 25 sanctions programs at the department of state. he works closely with the department of treasury to implement current and new sanctions. he also interacts with governmen governments around the globe and with the private sector to ensure implementation of our sanctions. fdd really appreciates the tireless work you and your team undertake. after his remarks, das peyman and david lorber about talk about at problem to addressing the challenges in this area. eric is the senior director of fdd center on economic and
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financial power. he previously served as senior adviser to the undersecretary for terrorism and financial trillion dollars at the united states department of treasury. please join me in welcoming deputy secretary of state david peyman. [ applause ] >> thank you very much for the nice introduction. good afternoon. let me start by thank you fdd for having me here this afternoon. i believe you were founded shortly after 9/11. to help protect our country from all threats. and i believe you've done a fantastic job in empowering policymakers with thoughtful analysis and investigative reporting. that really has helped keep our country safe and make our country safer. i think what distinguishes fdd is that you publish not only
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inciteful and thoughtful analysis but your products are operational. and their actionable. and i could show you that they're read throughout our government and we look forward to reading more. i like to touch upon three topics today. first, the role of my division threat finance sanctions and sanctions policy and implementation. second, i would like to discuss our sanctions approach with respect to iran. and third i would like to discuss our enforcement posture and make an announcement with the respect to the maritime industry. it is the key artery for sanctions of asia globally and including sanctions against north korea and our sanctions against venezuela and our sanctions against iran and syria as well. my division consists of two offices, toby mentioned one.
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the office of sanctions policy implementation manages programs ranging from venezuela, north korea, iran, russia, syria, global magnitsky and nick raug wau and others. we deal with illicit financing through conflict minerals so we are the government representative to the kimberly process and also the state department representative to fatif where we work closely with our treasury colleagues to implement anti-money laundering standards within the fatif. one of the key roles is to help design the architecture or the framework for aur respective sanctions regime and we do so by working very closely with our special representatives, especially representative hook on iran, special representative
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abrams on venezuela, deputy gan and wong on north korea as well as a close day-to-day partnership with our treasury colleagues as well. so we were instrumental in helping draft the recent syria executive order 13894 which allows us to designate bad actors who are contributing to the worsening situation in syria. but it allows us to do more. it allows us to designate family members of bad actors. we recognize that this regime along with other dictator regimes are alluding the wealth of their own people and using that wealth to not only enrich themselves but enrich their families. and we intend to hold them accountable. we also play an honest broker role. we don't want to see sanctions in one policy area undermine the national security priorities and the policies of our president
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and our secretary in another policy area. for example, when we decided to sanction venezuela's oil sector and peta vesa, we worked closely with our energy colleagues to ensure that the venezuela oil sanctions will not cause instability in price or supply of oil. if it does, obviously it has economic consequences for us here at home and it has consequences with respect to other sanction policies including iran. we conducted that analysis and we determined it would not have a negative impact and i think time has proven that to be true. one thing that we've done that is, i think, quite historic at the state department in the last year is that we created an economic sanctions targeting team within my bureau to focus on designating those that violate sanctions and sanctions authorities, granted to the
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secretary of state. so this team undertook to sanction costco, which is the largest ship owner in the world. a major chinese state-owned enterprise that was violating our sanctions against iran. and i think the very, very clear message that this this designation sent was that we are focused on strategic sanctions. sanctions that have an impact beyond the designate target itself that have an impact across industries and sectors and the clear message that i think we're trying to send that secretary pompeo was trying to send is no company it too big to fail when it comes to protect itting u.s. national security. no company is too safe when it comes to protecting our homeland and the american people. and so we undertook that designate notwithstanding the fact it was a considerable
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increase in shipping costs globally. not only with respect to china, to send that very, very clear message. one of the most important things that we do at the state department is to use actionable intelligence, downgrade intelligence engage with foreign actors to determine if there is an opportunity for them to change behavior before we have to resort to enforcement actions. and if they do change behavior, that is a fantastic result. oftentimes that comes quicker and more efficiently than undertaking a designation. we also take in a multi-lateral approach to sanctions. so for example we engage with countries and private sectors around the world to make sure they comply with and implement sanctions. panama signed a presidential decree last year that allows it to withdraw the flag from any
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ship within 24 hours that vi viet -- that violate sanctions or used for terrorism financing. without the right of appeal to the ship owner. before ship owners would have 30 to 60 days to appeal a decision to de-flag. that decision will not come immediately and it will not be appealable. we have also worked with flag registries around the world to help them share information. so one key success was the implementation of the risk. risk is the registry information sharing compact. an agreement that was initially signed by panama, the marshall islands and liberia, among the three largest flag registries in the world. to help share information about bad actors. so if panama or siberia plan to
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de-flag a ship for violating sanctions they'll tell other parties in the risk about that de-flagging action to ensure that bad actor doesn't flag hop. i could announce today that saint kits and nieves and honduras and pal ow have signed on to the risk and other countries are currently in negotiations to sign on to the risk as well. let me move on with respect to our approach toward iran and our sanctions regime toward iran. our objectives have been laid out by secretary pompeo and special representative hook and they are, number one, to deprive the regime of funding used to gain in the host of malign activities all over the world from developing ballistic missiles engaging in proxy wars in syria, to supporting and sponsoring houthi rebels in
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yemen and fire missile news saudi population center and sponsorship of terrorist organizations from hezbollah on down. second, our sanctions are designed to incentivize the regime to come to the negotiating table and address the 12 points laid out clearly by secretary pompeo which really go toward five key objectives. number one, stop your sponsorship of terrorism. number two, stop your proxy wars in the region. number three, give a full accounting of your nuclear program with inspection of all sites. number four, stop your development of ballistic missiles. and number five, release all hostages, including, of course, u.s. hostages. but what we're really asking iran to do is come to the table and act like any other normal country in the world. and how have we gotten to achieving our objectives? well, iran has said they are no
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longer funding certain shiite militia in iraq. hezbollah for the first time is making public desperate pleas for donation to fund its activities. let's look at the numbers. oil revenues are down by 80%. we've taken 2 million barrels a day of oil off the market from iran. that has amounted to $50 billion per year that is not going to the iranian regime to fund the malign activities abroad and commit human rights abuses at home. the regime is running out of options to store oil that we have sanctioned and they are now cutting some production. we will target and designate anybody that stores iranian oil, petrochemicals or refined petroleum in violation of u.s. sanctions to -- sanctions no matter where they are.
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and we'll soon announce a sanctions advisory on exactly that topic on the risk private sector companies face and other face in storing iranian oil in violation of u.s. sanctions. we have been quite successful in our campaign to take iranian oil off the market and that has led to iran resorting to petrochemicals and refined petroleum products as a major source of revenue and we have now also adjusted our enforcement posture to attack those two sectors as well as the metal and construction sector and other sectors that are sanctioned as well. the regime does not have any good options to fund an even modest budget. according to the imf, it is estimated that iran's economy contracted by 9.5% in 2019, however that number is based on
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oil exports of approximately 600,000 barrels per day. we know iranian exports are less than that. some analysts indicate the contraction is actually closer to 12% to 14%. 10% is a depression. inflation is in double-digits, it has been hovering around 40%. unemployment is in double-digits. 17 out of 18 iranian pension funds are bankrupt. they are in the red. that has resorted iran to issuing a false budget. oil exports typically comprise 30% of iran's revenues. and are our sanctions are bringing this number close to zero. the regime itself said it exports about 300,000 barrels per day so it is curious why the regime put out a budget, a draft budget, that assumes exports of 1 million barrels per day of
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oil. shortly after they release this fake budget, the real tanked. iran cannot be trusted to run its own economy. this regime cannot be trusted to run its own economy. iran has a few options to respond. it could cut sub siddys and we saw that when it was forced to raise gas prices. that led to mass protests against the iranian regime. for the first time we heard chants of death to the dictator, death to homenei or it could tax the wealthy elite and regime cronies or irgc companies which it is not deciding to do. instead it is shifting the burden to the middle sector. iran has a dark economy. it has multi-billion dollars so-called charities and foundations run by hoe many and
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his cronies that are untaxed and whose wealth does not reach the iranian people. 99 of 100 of iran's purportedly private companies have an affiliation to the regime or to the irgc. failing state companies are continuing to be subsidized and protected from taxes, further draining iran's coffers. so iran has a choice to make. if the regime continues to divert money to ballistic missile, terror sponsorship, proxy wars in the region, it could do so but it will have to start print arie -- start printing money which will cause the economy to completely collapse or delay spending on salaries, benefits and economic development. but it cannot do both. this is why we are here today in the streets of tehran and across
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iran death to homenei and people do know that the regime must swallow the bitter sanction in order to finally change behavior. they know that corrupt officials that are mismanaging the economy are responsible for plight. all of the results have happened since the reimposition of sanctions in november 2018, the full reimposition. but actually i would argue that t it has been less than a year sense they decided not to issue sre waivers for several countries that were continuing to import iranian oil. that stopped np may of last year. so it has been less than a year that we've seen all of these results. we've also made clear that we stand with the iranian people. and we leave open a humanitarian channel for the export of food and medicine into iran.
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while cautioning that in 2017 and '18 the treasury department designated so-called humanitarian companies in iran and libya and -- i'm sorry, lebanon, por funneling millions to the irgc. we've created a swiss mechanism to help facilitate more humanitarian exports to iran while implementing enhanced due diligence to to ensure the irgc is not cooperating with the export of humanitarian aid to the iranian people. the u.s. maintains broad exceptions to facilitate the flow of food and medicine into iran and this swiss mechanism is one option. special representative hook and our department have recently made public statements that we're willing to help the iranian people fight the coronavirus disease and that offer has not, unfortunately, been accepted by the regime. let me move on to the third
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topic. our sanctions enforcement posture more broadly. i'd like to announce today that we'll soon be issuing a global maritime sanctions advisory. the shipping sector, the maritime sector at large from flagging registries to insurance companies to ship owners to port operators to terminal operators and managers and charter companies have more work to do to entheir -- to ensure their vessels are not financing and contributing to terrorisms or violating sanctions at large, u.s. and eu sanctions as well. in this global maritime advisory we're going to focus on the use of ais. ais transponders that roprovide the location of vessels should never be turned off. if they are, that is a risk that
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requires heightened due diligence. flag registration should ask for ais for those that seek to flag their vessels with flagging countries and they should see the history of the ais and if had has been turned off or manipulated that may be a reason to deny services. same for insurance companies and financial institutions. there are certain obvious high-risk jurisdictions where vessels engage in ship to ship transactions in order to evade u.s. sanctions. these include the persian gulf, the uae, iraq, malaysia, hong kong, off the coast of china. false bills of lading are used to disguise the original source of cargoes. i encourage anybody in the private sector who is suspecting a false document to contact the u.s. government, contact my division, contact o-fact to
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determine if there is guidance on whether that bill of lading or that documentation is indeed fraudulent. private sector actors, port authorities should be using long-range identification and tracking radar. as appropriate to ensure they're tracking all vessels in area of operation. for example if you're a port operator in the persian agriculture. rlit could be used 24 hours a day, sen days a week to determine if all ships in the area have docked in an iran port or stopped in iranian waters to conduct an sds transfer or have stopped just outside of iranian waters to conduct an sds transfer. we are encouraging ship captains and crews to take pictures of the captain's and crews of the ships they do an sds exchange with. so if you're getting oil from
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another ship, it might be appropriate to take pictures of the captain and the crew of that ship and to transparentally inform them if that cargo is sanctions, you'll release those pictures to appropriate authorities. legal representations about sanctions compliance are always appropriate. importantly it is appropriate to obtain the beneficial ownership information of vessel owners and those your providing services to in the maritime sector. not only the information about the front company that might be seeking a flag or the parent of that flag of that front company, rather the ultimate beneficial owner and the individual principals that own and control that entity that ultimately get the benefit of that flag. it is also appropriate to determine if your counterparty
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has their own sanctions compliance policies that are as robust as yours should be. second, we are going to continue to aggressively enforce sanctions wherever a private sector actor or a government may be violating them. and we're going to look towards enforcing them in a strategic way much like the designation with costco which was a strategic sanction designed to send a message across an industry. sanctions are the sharp tip of a foreign policy spear. in 2009 through '16, we had 535 actions. if the first three years of this administration we've had close to 800 actions. we expect this pace to continue. we also understand that sanctions are not a silver bullet. they are simply a policy tool that are used in conjunction
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with other policy tools to achieve our foreign policy objectives. but this administration has not hesitated to use the full weight of the great american economy to protect our national security and we'll continue to do so. thank you very much. [ applause ] >> thank you for that, david. that was quite a breaking set of announcements and we really appreciate you doing that here with us. for those of us who are with us in the audience following us online and watching us on c-span, if you have a question, please feel free to tweet at fdd with the question and i'll check my phone every now and again and
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incorporate those in the conversation. two big announcements. one big announcement, the risk compact and additional jurisdictions. that is fantastic. second big announcement is forthcoming advisory related to the global maritime sector. before we touch on a couple of topics that i really want to focus on in the iran context and the venezuela context, could i ask you, what is your message to the shipping industry right now about sanctions and sanctions of asia? >> sure. many actors in the shipping industry are good actors. they have good intentions. i think there needs to be a greater appreciation of the immense economic risks to those that do not appreciate u.s. sanctions and do have the infrastructure to protect themselves against sanctions violations and ensure they're being proactive in complying with u.s. sanctions. so the first step is understanding our laws and
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having expert advice on how to meet those regulatory requirements. i think the second step is to take a step back and to understand that sanctions are foreign policy tool intended to achieve foreign policy objectives. so it is not necessarily enough to be complaint with the letter of the law. it is not enough, perhaps, in terms of your risk analysis and the health of your business for the long-term to only be concerned with a letter of the law. it is important to understand where u.s. policy is today and where it is going in the future. and we've tried engage the shipping industry at large from ship owners to flag registries, insurance companies, financial institutions that provide financing to ships as well as ones that own ships to send that very, very clear message. and a part of our message is we want to have an open door policy.
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so we want to be able to field questions from the private sector. but i really do think there is much more space for improvement in the private sector. it seems like much of the shipping sector is a generational business that has been handed down from generation to generation. and business was conducted in a certain way, maybe 50 years ago, or 30 years ago or even ten years ago. the world has changed quite dramatically in the last ten years. the use of u.s. sanctions, i think, have escalated and i think we've shown that we're ready to undertake strategic targets so i think there is a lot of space there. the maritime advisory is intended to provide guidance, answer a lot of questions, and get people started on the hard work that they must do to get to where they think they need to be. >> got you. fantastic. so turning to venezuela first.
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this administration has launched and continues engage in a significant sanctions campaign to pressure maduro and his cronies. what is your sense of the administration's next steps? what are you planning to continue to pressure maduro to stop looting the economy and to allow for free and fair elections in? >> so i think special representative abrams has been quite clear we intend to hold those accountable that are undermining the democratic process in venezuela and supporting an unelected dig-- dictator and undermining the legitimate president guaido and those include foreign actors interfering in venezuela which is why we recently designated a are rosnef entity for their continued operations in the oil sector in venezuela. we'll continue to hold foreign actors accountable for behavior and interference and continuing to to hold maduro reg cronies
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accountable for the stealing of the venezuelan people wealth and property and assets while at the same time seeking to block assets, hold assets for day one. day one of the legitimate government that actually is able to run the country without the interference of corrupt dictators like maduro. >> got you. a lot of interesting things to unpack there. the first is it seems like this is something of a targeted pattern with the administration of focusing on supporters of regime that we don't like and think are following the rules. and you have the costco designation in the context of iran. is this something that your office in particular is really targeting, this sort of material support network able to prop up these regimes? >> absolutely. are where we have authorities we'll be pursuing them.
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i think it is important to note the united states does not tell anybody what to do. but we have a sovereign right to decide who we do business with. who gets to use our dollar, who gets to use our financial system. and we've spent the better part of the last century making sure we have the strongest most rely on strongest occurrence in the world and we have no tolerance for those who do business with terrorists, corrupt dictators and those who commit rights abusers and steling the wealth of their own people while undermining global peace and security and threatening our national security. >> great. thank you. and on your comment making sure that on day one the guaido government will have access to sort of assets that are held abroad or have been stolen by the maduro regime and its cronies. how is the state department
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figuring out where those assets are and making sure they're going to the right place the day after. >> when the treasury deposit undertakes an enforcement action to freeze or block an account, we're able to determine where those monies are and ensure that their continuing to be frozen and blocked and not used by malign actors to the detriment of the venezuelan people and we're closely tracking globally, i think, assets, accounts and monies worldwide to ensure that those are preserved for the venezuelan people. >> gotcha. and we've seen over the last few months the reinvigoration of the venezuela program certainly with interim president guaido's appearance at the state of the union. could you give us a preview, not mentioning specific targets under consideration, but where you see the venezuela sanctions program going over the next few
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months. >> sure. so i think we sent a really clear message over the last few years that we're taking an escalatory approach in venezuela. and our sanctions are going to continue to ramp up. that ramping up could be broadening the scope of our targeting, to include secondary actors that contribute to the situation in venezuela, who are located outside of venezuela. but that could also include a substantive broadening of our sanctions program. to potentially include other sectors and other areas that are not yet sanctioned and obviously i can't get into the details to forecast what they might be. other than to say everything is on the table. >> gotcha. gotcha. thank you. so turning to iran. based on your comments and the economic figures you included in your comments, it is clear that the maximum pressure campaign is having a significant impact on
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the iranian economy. and it is also, i think, having a significant impact on the iranians' ability to finance terrorism and malign activities through the region. a couple of questions on thisment first question is, is there. first question is, is there more the private sector can do in your estimation to amplify that pressure? >> yes. i think there's always -- >> and if so, what? >> there's always more, i think, the private sector could do. we talked about the shipping sector. i think also in the metal sector. needle, coke, and electrodes are key components to iran's ability to produce metals, which they then export for significant revenue. the state department issued an advisory a couple of months ago on this particular topic. i encourage producer of needle, coke, and electrodes to carefully read this advisory.
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because many of these economies may be located in the united states and may be located in europe and may be selling their electrodes to chinese companies and then exporting them to iran. it's important to have good export controls around high-risk products. this is a high-risk product. i think it's important for terminal operators in ports across the globe to ensure they have sufficient compliance programs to ensuring they're not taking or allowing the port to take from iran, cl that's crude oil, metals, or construction material. any material that is sanctioned would potentially put them at jeopardy. and i think understanding your risks more broadly goes back to understanding what the rules are and what the laws are. your exposure to them, and the
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direction of u.s. foreign policy. and we've graduated now from a maximum economic pressure campaign against iran to a super maximum economic pressure campaign, where we'll look toward ramping up our enforcement and continuing to designate key strategic targets. if i could just use the costco target as one example. costco, major chinese state-owned enterprise. so we designated two subsidiaries. and i think that was important, because it sent the message that i indicated in my speech, that no one is too big to fail. but also, the result was important. so after we designated costco, we engaged in several rounds of discussions with costco to ensure that they will comply with u.s. sanctions going forward. they created a sanctions compliance programs. they changed behavior.
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they changed behavior, which is the intent and purpose of our sanctions. our sanctions are not necessarily meant to punish. they're intended to change behavior of actors to become consistent with u.s. foreign policy. and i think they did that. >> let me follow up on that. so costco changed their compliance behavior. have you seen other shipping companies, for example, in the sfri, who looked at costco and said, wow, we don't want that to happen to us? have they similarly changed their behavior? are there indications of that, as well? >> there are indications of that. and we've seen that from other private sector companies. and i would note that it's not only in the shipping sector, because costco exports cargo. so those that rely on ships to carry whatever cargo they're doing business in, whether it's the energy sector or whatever sector that might be, those companies take notice. and they ask themselves, are we sensitive to this risk?
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what is happening with respect to u.s. policy? and we're getting those questions and indications, which is a great thing. and our door is always open to answering those questions. >> and it's something of a twofer in a sense that companies are beefing up their compliance programs, which is great in terms of increasing the integrity of the system, but at the same time, it probably allows you to more easily identify those companies who aren't doing that, who may actually be bad actors, intentionally importing crude. >> that's such a critical point. because i think for the health of any sector, it's important for bad actors not to take advantage of good actors. and we all recognize there's economic costs in complying with sanctions. and companies have to bear that costs. but they shouldn't act as a disadvantage to those that are manipulating the system and evading our sanctions. so the more we're able to create a common floor, about what good
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compliance means, and the more companies buy into that program, the more they'll be protecting themselves from bad actors and also not allowing others to take market advantage of the good work that they're doing. >> fantastic. >> and let me go back, david, quickly to your point about the maximum pressure campaign and the super maximum pressure campaign, great term. sometimes you hear the criticism or the comment that in terms of authorities, we're maxed out on iran. there's nothing else we can do from an authority perspective to ramp up pressure further. and of course, we heard this argument following the full snapback of sanctions in november of 2018. and there were steps that were taken afterwards to continue to ramp up the authority. but in your mind, is there sort of a super, super maximum pressure campaign? are there other authorities or steps that could be taken, beyond what you were discussing
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about enforcement, which is obviously incredibly important? >> well, just looking at it objectively and without forecasting what we may be thinking or doing, i think if you look at iran, there are other opportunities to expand the scope of our sanctions. >> i won't press you further. we have had a number of questions come in from the audience both during the session and before. so going back to the costco discussion and the question essentially is, how can we push china further to make sure they are not providing support to iran, and in particular, they're not providing support to iran in the context of importing iranian origin crude. i want to get your thoughts on that. >> one more announcement i can make today, and i think i may have mentioned it, we are going
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to be issuing guidance on bunkering, providing storage for sanctioned iranian oil. and the sanctions risk and providing that service, and so we're hoping, being transparent about where we see the risks and what we intend to do about it from an enforcement perspective will induce a change in behavior before we have to resort to enforcement actions. but we are looking at the very broad range of all behavior. whether that is a ship owner or a port operator or terminal operate or refinery. anybody basically in the supply chain of energy. from the very beginning, where our ship picks it up to the very end, after the ship-to-ship transfers may have occurred, and holding everybody in that chain responsible, i think, sends a very important message to the industry. that the time of pointing fingers and claiming ignorance
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is over. go >> gotcha. thank you. and following up on that, i apologize, because i started the conversation off by saying there are two major announcements or two big announcements. and i think there may be three, right? there's the risk exact. there's the bunkering guidance. and is that separate and apart from the maritime shipping advisory? >> yes. >> okay, great. and following up on the prior conversation about china, we've gotten some questions from the -- from the fdd tweet handle about the current impact of the oil price plunge over the last few days and what your assessment is for what that means for tehran and what that means for their ability to withstand the current sanctions regime that's in place. >> first, nobody should be importing sanctioned iranian oil. so notwithstanding any price,
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nobody should be in the business of dealing with sanctioned cargo. in terms of those that seek to evade our sanctions, having cheaper iranian crude may have an impact on their bottom line and their assessment on how worth -- the risk and whether it's worth it to engage in that kind of evasive sanctions-busting behavior, for potentially a decreased profit margin. >> okay, gotcha. and so do you think that price plunge would impact chinese buying if there is chinese buying over iranianian oil going on? >> i'm not going to speculate on the complexities of the energy markets particularly in china, other than to say that we expect no one to be engaged in sanctioned iranian cargo. >> and turning to some of the
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conversations that you've had with our european counterparts over the last six months to a year, obviously the decision to withdraw from the jcpoa was not a popular decision within the e3, within great britain, france, and germany, but it seems like over the last few months, anyway, there's been less sort of protests coming out of the e3 about u.s. sanctions policy towards iran. and really want to get your sense of where the e3 stands right now in terms of our maximum pressure campaign. are they more onboard with it? more reluctant followers? what's your sense of how things are going on? >> i think we've had very healthy continued close engagement with our partners in europe, on areas where we can align, today and going forward and i think there are areas that we could work on together, that includes areas outside of the nuclear context. whether it's responding to ballistic missile proliferation and the other host of bad acts
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that the iranians are committing, including assassination attempts on european soil. so you had attempts a couple of years ago in paris, a bomb plot in paris, an assassination attempt in denmark. i think the europeans have shown that they're willing and able to respond to that through the use of sanctions. and so where there's opportunities, we'll continue to work with them. i also want to make one point more broadly. not only about europe, but our partners all around the world. and there's a misconception that u.s. sanctions against iran are unilateral. but the point is in implementing our sanctions, we have fantastic partners all over the globe from europe to south america to asia, who are not only complying with u.s. sanctions, but are proactive proactively helping implement our sanctions.
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so at least in that respect, our sanctions are multilateral. and i don't think you would have seen the success that we've seen if they weren't. >> and they're multilateral not just in the sense of being multilateral with other jurisdictions, but sometimes they're multilateral with different types of actors. i know when i was at treasury and we were implementing the snapback of sanctions, we were very pleased to see how many companies, european companies in particular said, we're not willing to continue to do operations in iran in potential violation of u.s. sanctions. and so we're going to pull out. >> absolutely. and i think that's a perfect example of american clarity and leadership. when we take the lead, the world soon follows. and when we say, either business with the united states or a terrorist regime that's committing human rights abuses,
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sponsoring terrorism, that's a very clear choice for many in the private sector to be making. >> we saw companies leaving, huge companies that have massive operations in the country leaving within two or three weeks of the announcement, well within the wind-down grace period. what's your response to the oft-heard argument here in d.c. that we are overusing sanctions. and if we continue to use sanctions in such a unilateral way, well, the russians and the chinese and the europeans are going to develop workarounds and exhibit "a" is the european spv, and exhibit "b" is name your sovereign cryptocurrency. what's your response to that? >> it's a good question. first, we have to be and i think we are quite deliberate in how we use sanctions. to ensure a few things. number one, what is the policy
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objective? what is the goal that we're trying to achieve? secretary pompeo, special representative hook, the president have been extremely clear on our specific policy points on iran. we've been extremely clear on our specific goals with respect to venezuela. we've been extremely goal with respect to our goals on dprk north korea. so making sure you know what the foreign policy objective is, and dauz the sanction action, whether it's a new executive order or whether it's a new target, how does that move the ball forward? it could be in a modest, small way or in a strategic, large way. but how does that move the ball forward to achieving your ultimate foreign policy objective? and those are things we think about quite deliberately. and people much smarter than me, throughout our government, think about those things, with the help of our intelligence community. secondly, we do want to use sanctions in a multi-lateral way. on venezuela, over 50 countries
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around the world have supported our policies. on russia, transatlantic unity and cooperation is the cornerstone of our sanctions approach with respect to russia. north korea, similarly, the u.n. has done a fantastic job in ensuring implementation enforcement of sanctions writ large. that multi-lateral aspect is important. on iran, we just talked about how the globe in many ways silently, but nerls, are proactively helping us implement and imply our sanctions. that's also an important component. it's important to listen to the voices of the people in the countries where we have targeted sanctions. the voices of the people in venezuela who are supportive of our sanctions regime. the people in iran who are demonstrating death to khomeini,
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blaming him and his cronies for plundering the wealth of that country and it's also important, i think, to have conversations with our foreign partners on the appropriate use of sanctions infrastructure for their own countries. there's no reason why the united states has to be one of the few countries in the world with a sanctions infrastructure. and we've been having conversations, particularly within the rio group on why it's important for countries to have that ability. so when they see a need to protect their hemisphere, as we're all trying to do with respect to venezuela and foreign interferen interference. and the united states will stand by them every step of the way. >> it's interesting. one thing that's a little bit
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out of scope with the conversation, but obviously, with brexit, the only other major sanctions authority that's currently in place, where there's actually been enforcement authority is the uk. so it will be interesting to see if that office begins to ramp up its enforcement activity and the uk begins to adopt even more autonomous sanctions, you know, moving into the future. >> absolutely. >> one thing i'll say in response to the question, and about unilateral sanctions activity, at treasury, if we see bad activity that we can disrupt here and now with a designation and with some other type of disruptive action, we are going to take that action. it doesn't necessarily mean that we don't think about what the long-term implications are we absolutely did and it sounds like that's still an ongoing conversation as it should be, within the state department and the inner agency. but it was all sort of that, if
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we think that this action is going to stop this terrorist from getting money or, you know, the irgc from receiving hundreds of millions of dollars in hard currency, we're not going to pull that punch because we're aafraid of what this would potentially do to the power of u.s. sanctions down the road. i think that's much of the mind-set. >> i think that's largely true, absolutely so we're in the business of protecting this country and enforcing u.s. law. if you're breaking u.s. law, we'll look towards enforcing it and holding you accountable. and it's also important to note, just because you might think you're getting away with it today, don't hold your breath. because it takes some time to develop packages, as i'm sure you know. and we do have to go through the process. but have no doubt that process is continue iing.
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>> that's a great point i want to flesh out a little bit. everyone was leading the tea leaves because there was something of a dip in enforcement activity. and everyone wupz saying, oh, this might be part of a deregulatory approach, low enforcement, they're not going after anybody. it's a concerted effort. and those of us who have spent time in government and are in government knew in the back of our minds knew you can't just turn on or off enforcement activit activity. >> and i think that raises the need for private sector actors not to speculate and make assumptions. but that could have been a legitimate change in policy and that presents us an opportunity to have conversations with folks like yourself when you were at treasury or with the state department about what our
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approach is and whether it's changed or not. i've read a lot about why we delisted costco and the fact it was economically unsustainable, which is factually inaccurate. that's not to say that in the future of costco, they will not be redesignated. >> it's interesting that question of changing sanctions or and certainly with -- with the listing, it was that exact type of activity done by the treasury debate where we were able to secure real strong terms and conditions to make sure that the russian that should be designated no longer had ownership or control. >> absolutely.
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sanctions are a great rehabilitative tool to change the thinkinging and cost/benefit analysis of private sector actors. and as long as we can bring them on the right side of the railroad tracks, i think we've w won. >> i want to turn to our remaining questions. one concerns the financial action task force. so as you know, and congratulations, i think this was part of a long played out strategy. it called for the reimplication of countermeasures on iran i think it was two weeks ago. what's your sense of the impact that this -- that the call for reimposition will have on the iranian financial sector in particular? >> i appreciate the compliment, but assistant secretary billings lee at treasury really deserves much of the credit for doing the heavy lifting with getting to where we got to with respect to
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reimposing full countermeasures against iran. that has a tremendous impact and it feeds the same narrative that this is not a regime that can be trusted. this is not a financial sector that can be trusted. there has to be intense, heightened due diligence taken, even when you're thinking about potentially engaging in a non-sanctionable act. and so we'll see how that that plays out. and we'll see how entities may be reacting to the blacklisting. >> interesting, yeah. because there are a number of non-sanctioned iranian banks or designated but not subject to secondary sanctions. so they will likely be impacted, potentially, by this. and that raises another question, which is one we also received from the audience, and it's particularly germane in the light of everything that's happening or allegedly or supposedly happening in iran right now, related to the
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coronavirus. what's been the administration's response to coronavirus within iranian? and then, more broadly, how has the administration answered the critique of, we are in some way responsible for some of the humanitarian issues that the country is facing? >> we have been quite clear that the humanitarian channel has always been open and will remain open and we're encouraging the export of food and medicine to the iranian people. and the swiss mechanism was intended to provide another, i think, important mechanism to ensure that export channel stays wide open. we can't tell private sector companies what to do. but we can make clear what our approach is. and our approach is to keep that humanitarian channel open. i could tell you, also, that
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this is an area where i encourage private sector companies who have specific transactions that they're interested in, who may have some concern, to reach out to the u.s. government. my division has not received a lot of calls from people who are interested. and so if there is this perception out there that there's overcompliance, i would sail, please, if there is an interest on a particular specific transaction and there's hesitancy, there may be space for us to provide guidance, to ensure that kind of transaction could be accomplished. >> that's really useful advice. so, i work with compliants on the private side. and whenever anyone suggests to them, maybe they should reach out to the u.s. government authorities about a proposed transaction or a proposed business deal that may deal with humanitarian goods, provision of services to iran, their first response is almost always, no, no, no. don't go to usdg, gauze look at
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the fines and the enforcement activity. what's your response to that? >> my response is, we don't use those opportunities to play whack a moel. and to go after good intentioned actors who are looking for sound advice on how to comply. we don't use those opportunities to say, they came in to talk to us, how can we get to them? that's not the approach we take. and i'll tell you something, the best conversations i've had. and i think the ones that have been most pursuitful for are those operating in high-risk jurisdictions including lebanon and iraq and other jurisdictions who want to do the right thing and come into our office and have a frank conversation about how they could be doing the right thing without violating u.s. sanctions. those are tremly helpful conversations for private sector actors and i encourage them. and to your point about coronavirus that you asked
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about, special representative hook, i think, has made repeated public statements about our desire to help the iranians address this fires. i think treasury recently put out some guidance on our approach, so we've been quite clear that we're there and ready to offer whatever assistance that we can. >> and my understanding is that the iranians have not taken us up on those offers. >> that is correct. and i don't think they've taken us up on previous offers of humanitarian aid when they were facing other natural disasters. >> okay. so i have another question from our audience. and it builds off of the conversation we were just having about those who want to be in compliance. how do they actually come to you and to your office to get the guidance that they need? and so, you know, how would -- how would you recommend people get in touch with your team? >> so, we do have a website. and i think there's contact information there. there are there's an opportunity
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when you go to the threat finance division website to sign up for sanctions alerts, much like you would get from ofac. and i'll make sure when i go back to ensure that the contact is up to date. but you can reach out to us, to the extent it's an ofac question, you can reach out to us. but we will help facilitate that dialogue, as well. especially if it's time sensitive. i would encourage anybody reaching out to reach out with a specific set of facts on a particular transaction. it's hard to give any advice or guidance on a hypothetical. on a situation where we don't have all the facts. and naturally, that's going to illicit questions from us about more facts so we can make an honest assessment and be transparent. >> so for everyone on the line watching, the advice is, reach out, but reach out with all of
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the information ready to go. because if you don't, all you'll do is incur additional sets of questions that probably arise. are you guys fairly responsive in terms of getting back to inqui inquiries? >> i think we try to be. i think when folks have reached out to us, i spend a significant portion of my time communicating with private sector actors u.s. companies in the energy sector and other sectors, foreign companies, middle eastern companies, semi-private companies, government-run institutions, state-owned enterprises, in asia and other parts of the globe. i spent a considerable amount of time on those topics. it's important. because these are people that are responsible for a lot of business activity in key strategic sectors, where we want them to comply. so if we can get them there, and
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create a common threshold for what good compliance means, we've just -- we've just accomplished many objectives in one meeting or a few meetings. >> fantastic. so we've got a couple more questions from the audience. i want to ask, cognizant of the time, i want to ask one of them, but then i want to ask you the final question, which will be, all of us are thinking about in the compliance space and think tank world, what's ahead for sanctions in 2020. i want your thoughts on what you think is ahead for sanctions in 2020. of course, not giving away specific targets or anything like that. before we get to that question, though. the one from the audience that i do want to touch on is, walk us through how you think, of economic pressure, as one tool in the foreign policy tool kit. and in your role at state, how do you see sanctions complimenting other elements of national power? >> that's a great question. where do i see us going in 2020?
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i think it depends on which sanctions program you're talking about, obviously. so it goes back to the point of being deliberative, to ensuring the sanctions response, to specific policy objectives, and determining what kind of progress we're making. with respect to how sanctions work with other policy tools, it is, as i mentioned in my opening comments, not a silver bullet. it is one policy tool designed to achieve objectives used best with other policy tools. in terms of diplomacy, i think it gives us the leverage we need to have a good engagements and achieve positive results without resorting to enforcement action. so the sanctions tools are there. i think we've made good examples that have violated our sanctions and we've shown that we're not hesitant to use our sanctions, no matter who you are or in what country you're located in. so when we have those real, frank discussions with those that could be doing more to
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comply with sanctions, that may potentially be violating our sanctions. i think knowing that we have enforcement mechanisms, authorities to back that up is important. i think knowing in the iran context, you know, sanctions are sanctions. and we work very closely with our treasury colleagues to implement sanctions. we have expanded our resource base. we have expanded it to include a sanctions targeting team in the state department, to implement economic sanctions authorities, delegate it to the secretary of state, and work closely, hand in hand, with our treasury colleagues, as well. in implementing and helping them implement treasury authorities, as well. it doesn't matter at the end of the day, it's all one u.s. action. but we've increased our enforcement power, i think. and we're continuing to expand that. that only leads to more fruitful discussions in being proactive with foreign counterparts on
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what they should be doing to comply before we need to resort to enforcement. >> fantastic. and i will say that as a former treasury person, it's great to hear that that state is expanding your resource base, because i'll tell you, as i'm sure you know, the folks in ofac work so hard. so i'm sure they've been grateful for that. >> they work hard, they're talented. i've never seen a more dedicated group of people than my counterparts at ofac led by andray and it's just fantastic partnership throughout. we work with them on like an hourly basis. >> i would like to give you the last word. >> first of all, thank you for allowing me to be here and giving me the opportunity to speak with you. i think these discussions are critical.
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i think creating more transparency with the private sector is indispensable. and ultimately, the best way we can protect the united states is through public/private partnership and cooperation and that's what we intend to do going forward. >> please thajoin me in thankin assistant secretary of state david payman. [ applause ] >> if you missed any of our live coverage of this event, you can see it again online at just type foundation for defense of democracies in the video
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search box, which you will find at the top of our home page. and a live look at the u.s. capitol here on this monday, where both the house and the senate are planning to meet this week. the house starts legislative work at 4:00 p.m. eastern today. members will consider six bills, including allowing citizens of ireland to apply for e3 temporary professional worker visas, including two measures to help unify korean-americans with relatives in north america. any recorded votes requested will be postponed until 6:30 p.m. eastern today. later this week, in the house, plans to vote on a senate passed joint resolution without congressional approval. also possible, debate to extend fisa past sunday's deadline. you can watch the house live on c-span. the senate also in session today. they start at 3:00 p.m. eastern. lawmakers continue to continue working on a bipartisan energy bill with a vote on that measure at 5:30 eastern today. and you can watch the senate live on c-span2.
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we have some news from the senate for you today. montana democratic governor steve bullock announcing today he'll challenge steve daines for his seat. "the washington post" reports governor bullock had come under increasing pressure since dropping his presidential bid, including meeting with former president barack obama in washington. and with senate minority leader chuck schumer, you can read more at of course, we are watching the situation with the coronavirus closely. senator bernie sanders will be part of a roundtable discussion with public health experts and leaders in detroit on that situation. and we'll have that live for you starting at 3:15 eastern here on c-span3. you could also watch online at c-sp or listen with the free c-span radio app. and to follow the federal response to the outbreak, go to our website, there you'll find all of our coverage, including hearings, briefings, and conversations from our washington journal program. and review the latest events
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