Iran has been subject to various embargoes since the 1979 hostage crisis and subsequent Iraq-Iran war. Due to the country’s alleged support for terrorist activity, as well as severe disagreements with the administration of Iranian President Mahmoud Ahmadinejad, the U.S. has enacted a near-total embargo against Iran, in the hopes that the adverse economic effects may spur change in the nation.
Without receiving an exception from the Treasury Department, no U.S. persons or businesses are allowed to do business with Iran, import Iranian products (as of 1987), participate in petroleum development (1995) or sell aircraft and/or aircraft repair parts to aviation companies in Iran.
In 2007, Iranian banks and other financial institutions were sanctioned, cutting them off from global financial markets. As of November 2008, U.S. financial institutions are no longer allowed to process “U-turn transfers” that originate and end with non-Iranian banks, yet involve Iran. Like other OFAC countries being targeted, restrictions have become tighter over the years, and an effective Iran OFAC compliance program will take these guidelines into account, in order to avoid liability for penalties.