Watchdog Warns U.S. Sanctions on Iran Hurt by Poor Export Data Systems
Treasury's Paper-Based System Cannot Be Searched to Identify Export Licenses to Iran
By MATTHEW JAFFE
March 4, 2010
Poor record-keeping and outdated information systems are hurting the U.S. government's ability to make sure that sanctions against Iran are complied with, a government watchdog said Thursday.
According to the Government Accountability Office, the Treasury Department is unable to give complete, timely information about export licenses to Congress or other federal agencies because of the problems.
"Treasury's information systems weaken the ability of the government to assess compliance with Iran sanctions," the GAO found.
An improved system would make it easier for the agency to ensure that only humanitarian goods -- not military weapons or nuclear technology -- are going to Iran.
In recent years, the Justice Department has prosecuted several people for trying to ship military aircraft parts to Iran. The Justice Department has said that from January 2007 to September 2009, there were more than 30 criminal prosecutions involving actual or attempted trans-shipments to Iran.
Part of the problems stem from Treasury's reliance on paper-based information systems that cannot be searched to identify licenses for the export of goods to Iran, the watchdog found.
For instance, an agency official told the watchdog that the system still uses manual data entry as well as non-standardized data for license applications entered before 2007.
Therefore, the congressional investigators found, the government "cannot readily determine the extent to which it has issued licenses for such exports or the extent to which goods marked for Iran are leaving U.S. ports."
When U.S. Customs and Border Protection officials last year requested complete data to help their inspectors at U.S. ports enforce the sanctions, the agency was unable to fulfill the request.
"U.S. agencies," the GAO said, "should have complete, reliable, and timely information concerning these matters to ensure the U.S. government is implementing the ban on exports to Iran."
Official U.S. government statistics showed that U.S. firms exported 278 types of goods to Iran from 2004 to 2008, but nearly 100 of them actually went to other countries such as Iraq and Ireland, the GAO found. The exports included such items as military rifles.
The misidentification stemmed from errors in data filings handled by the Census Bureau. In response to the GAO review, the Census Bureau said it now manually is checking all export filings to Iran.
Rep. Dave Scott, D-Ga., one of two members of the House Foreign Affairs Committee who requested the GAO investigation in 2008 after reports that U.S. firms were exporting numerous goods to Iran, said he was "somewhat assured" that federal agencies are restricting direct trade with Iran.
However, Scott stated, "We must be clear that it is in our national security interest that we enforce prohibitions on certain exports to Iran."
In the past, Iran has been able to obtain U.S. military goods through individuals who ship the items through other countries such as the United Arab Emirates, Malaysia and Singapore.
In a letter to the GAO in response to the report, Adam Szubin, head of Treasury's Office of Foreign Assets Control, acknowledged that the agency "can improve its data systems," but he denied that problems with data processing are impeding the enforcement of export restrictions.
"Nothing in the report indicates that any enforcement action regarding exports to Iran or the implementation of sanctions with respect to Iran have been impaired by 'incomplete and untimely' licensing data," Szubin said.
Just last month, the Obama administration imposed new sanctions, banning U.S. transactions with four companies and an individual affiliated with Iran's Revolutionary Guard Corps.