VZCZCXYZ0002
OO RUEHWEB

DE RUCNDT #0828 2612314
ZNR UUUUU ZZH
O 172314Z SEP 08
FM USMISSION USUN NEW YORK
TO RUEHC/SECSTATE WASHDC IMMEDIATE 4949
INFO RUEHGG/UN SECURITY COUNCIL COLLECTIVE IMMEDIATE
RUEHII/VIENNA IAEA POSTS COLLECTIVE IMMEDIATE
RUEATRS/DEPT OF TREASURY WASHDC IMMEDIATE

UNCLAS USUN NEW YORK 000828 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: PARM IR UNSC MNUC ETTC KNNP
SUBJECT: UN/IRAN SANCTIONS: COUNCIL FOCUSES ON FINANCIAL 
INSTITUTIONS 
 
1.SUMMARY: Following a September 11 briefing on the 
activities of the Iran Sanctions Committee, the Security 
Council focused on the role of Iran's financial institutions. 
 Ambassador Khalilzad called special attention to U.S. 
efforts to implement provisions of Security Council 
resolutions involving Iran's banks and other financial 
institutions, and expressed concern about Iran's deceptive 
financial practices.  Although the United States is normally 
the only Council member to speak in these routine Iran 
briefings, all P-5 members and Italy also delivered 
statements.  Russia asserted that the Council's call for 
vigilance over Iran's financial institutions (paragraph 10 of 
UNSCR 1803) was intended to be only a "political signal" and 
did not create new restrictions. France, Italy and the UK 
supported the U.S. position for robust implementation of 
measures against financial institutions and highlighted EU 
action to implement UNSCR 1803's call for vigilance.  China 
asserted that sanctions alone cannot solve the Iran dispute. 
END SUMMARY. 
 
2.In September 11, Belgian Perm Rep Jan Grauls briefed the 
Security Council on the activities of the 1737 (Iran) 
Sanctions Committee over the last ninety days.  Grauls, the 
chair of the committee, explained that the committee had 
received reports from 56 member states about their 
implementation of UNSCR 1803 and had also received 
notifications for exemptions to the asset freeze.  He 
mentioned that on September 10 the United States briefed the 
committee on U.S. efforts to implement paragraph 10 of UNSCR 
1803, which calls for states to exercise vigilance over 
Iran's financial institutions, and noted that on August 1 
France, the United Kingdom, and the United States distributed 
to the Council a list of banks domiciled in Iran and their 
branches and subsidiaries abroad. 
 
3.Ambassador Khalilzad emphasized the need for full 
implementation of UNSCRs 1737, 1747 and 1803. He called 
special attention to the provisions of those resolutions 
related to Iran's financial institutions and asserted that 
these provisions apply to all types of financial 
institutions, including banks and insurance providers. He 
pledged to support the 1737 Committee in carrying out its 
mandate, explaining that the goal of the September 10 U.S. 
expert briefing to the committee was to help states implement 
the Iran-related sanctions resolutions more effectively. The 
ambassador also noted concern over Iran's deceptive financial 
practices.  He restated U.S. commitment to a diplomatic 
resolution of the Iran situation. 
 
4.The Russian delegate said he hoped the 1737 Committee would 
be guided "by the spirit and the letter" of Iran-related 
UNSCRs.  He asserted that paragraph 10 of UNSCR 1803 was 
solely a "political signal" to Iran and did not create any 
new restrictions on financial institutions.  The Russian 
representative also claimed that states have the right to 
determine themselves how to exercise the vigilance called for 
in paragraph 10. 
 
5.The French delegate emphasized the obligation states have 
under the three Iran sanctions resolutions to implement 
measures regarding financial institutions and thanked the 
U.S. mission for briefing on its efforts to do so.  He 
criticized Iran's refusal to cooperate fully with the IAEA or 
to negotiate in good faith after Iran was offered a generous 
package of incentives at the Geneva meeting last July in the 
presence of the U.S. political director.  The Italian 
delegate spoke about recent EU action to implement 1803 and 
noted Italy's national efforts to combat the financing of 
proliferation and inform its financial sector about the risks 
of doing business with Iran's banks.  The UK delegate noted 
the importance of sharing information in order to help 
countries make informed decisions about how to implement the 
Iran-related UNSCRs, especially in light of Iran's steps to 
evade sanctions.  He expressed the UK's "profound concerns" 
that Iran's continues to flout the Security Council's 
demands, saying that there was no choice but to begin 
discussions with partners on additional measures, as 
envisioned in UNSCR 1803. 
 
6.The Chinese delegate noted the importance of full 
implementation of UNSCRs 1737, 1747 and 1803. He emphasized 
that sanctions alone cannot solve the issue and called for 
all parties concerned to demonstrate flexibility in 
negotiations. 
Khalilzad