Congress to target Iran through divestment

WASHINGTON, May 17 (UPI) -- U.S. senators and representatives are advocating undercutting Iran's finances as an approach to undermine its nuclear program.

Reps. Tom Lantos, D-Calif., and Barney Frank, D-Mass., joined with Sen. Barack Obama, D-Ill., to introduce a bill Wednesday that would require the U.S. government to publish a list of companies that have invested more than $20 million in Iran's energy sector.

The legislators intend that the bill "empowers Americans to apply economic pressure on the Iranian regime," according to a statement issued by the House Committee on Financial Services, chaired by Frank.

"All Americans can play a role in pressuring companies to cut their ties with the Iranian regime, a state sponsor of terror that is a threat to our allies in the region and international security, as a means of convincing Iran to fundamentally change its policies," Obama said in a statement.

It is currently illegal for U.S. companies to do business with Iran, but some legal loopholes enable U.S. companies to be invested in Iran through offshore subsidiaries.

"This legislation makes use of one of the most successful diplomatic tools available to discourage Iran from developing nuclear weapons: the financial vise," said Lantos, chairman of the House Foreign Affairs Committee.

"We can put the squeeze on Iran using this tool; it encourages companies and individuals to remove their money from any investment that might support Tehran's heedless quest for nuclear weapons."

Some critics of sanctions say that limiting a regime's finances can backfire because people at the top of the regime rarely feel the pressure. Instead, the general population suffers from economic isolation, critics say, and the regime can manipulate the situation to bolster its image among the citizenry.