U.S. Announces New Sanctions on Iran

The United States announced today new sanctions against Iran, a country that Secretary of State Condoleezza Rice called Wednesday "perhaps the greatest challenge for American security interests in the Middle East and possibly around the world."

At a joint news conference Rice and Treasury Secretary Henry Paulson announced the new sanctions , including designating the Quds Force wing of Iran's military Revolutionary Guards Corps as a "terrorist organization."

The United States says the sanctions are in response to illegal Iranian weapons sales and are an effort to curb the country's nuclear ambitions.

As part of the move, 20 Iranian companies, banks and indviduals will be subject to sanctions.

The Quds Force has been accused by the United States of supporting and arming attacks against U.S. soldiers in Iraq as well as aiding terror groups throughout the Middle East.

It is the first time that the United States has branded a foreign military entity as a terrorist organization. It comes at a time when the tensions between Washington and Tehran have once again been ratcheted up, this time after comments from Vice President Dick Cheney that Iran would face "serious consequences" over its suspected pursuit of a nuclear bomb.

Cheney's remarks set off renewed speculation that the Bush administration was planning military action against the Islamic republic.

During her testimony before the House Foreign Affairs committee Wednesday, Rice insisted the United States is committed to a diplomatic solution to the problem and added that Cheney agrees with that approach.

Washington had planned on imposing such sanctions on Iran in August, but Rice became furious when the plans were leaked to the press and European allies raised concerns.

During Wednesday's Hill testimony Rice hinted that actions against Iran were imminent, saying that the United States would move to cut off Iran's "malignant" activities in Iraq and that the administration was looking at "new designations" against Tehran though she did not provide specifics at the time.