Title: Blocking Iranian Illicit Finance Act
Policy area: International Affairs

Summary:
Blocking Iranian Illicit Finance Act
This bill expands sanctions against Iranian financial institutions that engage in various prohibited activities. It also directs the President to impose sanctions against (1) persons that provide financial messaging services to such institutions, and (2) persons that conduct significant transactions in any Iranian digital currency.

[Congressional Bills 115th Congress]
[From the U.S. Government Publishing Office]
[S. 3758 Introduced in Senate (IS)]

<DOC>






115th CONGRESS
  2d Session
                                S. 3758

To impose sanctions with respect to Iranian financial institutions and 
  the development and use of Iranian digital currency, and for other 
                               purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                           December 13, 2018

Mr. Cruz (for himself, Mr. Rubio, Mr. Cotton, Mr. Tillis, Mr. Gardner, 
 Mrs. Hyde-Smith, and Mr. Young) introduced the following bill; which 
 was read twice and referred to the Committee on Banking, Housing, and 
                             Urban Affairs

_______________________________________________________________________

                                 A BILL


 
To impose sanctions with respect to Iranian financial institutions and 
  the development and use of Iranian digital currency, and for other 
                               purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Blocking Iranian 
Illicit Finance Act''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title; table of contents.
   TITLE I--STRENGTHENING EXISTING SANCTIONS WITH RESPECT TO IRAN TO 
  ACCOUNT FOR ALL SANCTIONABLE ACTIVITY, INCLUDING HUMAN RIGHTS ABUSES

Sec. 101. Findings.
Sec. 102. Expansion of prohibitions on correspondent accounts or 
                            payable-through accounts for foreign 
                            financial institutions that facilitate 
                            transactions or provide financial services 
                            for certain Iranian financial institutions.
Sec. 103. Expansion of sanctions with respect to persons knowingly and 
                            directly providing specialized financial 
                            messaging services to, or enabling or 
                            facilitating direct or indirect access to 
                            such messaging services for, the Central 
                            Bank of Iran, other designated Iranian 
                            banks, or Iranian financial institutions 
                            removed from the list of specially 
                            designated persons pursuant to the 
                            implementation of the Joint Comprehensive 
                            Plan of Action.
   TITLE II--NEW SANCTIONS AUTHORITIES WITH RESPECT TO IRANIAN BANKS

Sec. 201. Findings.
Sec. 202. Issuance of final rule regarding application of special 
                            measures with respect to Iran in connection 
                            with designation as jurisdiction of primary 
                            money laundering concern.
Sec. 203. Imposition of sanctions with respect to financial sector of 
                            Iran.
Sec. 204. Authorization of imposition of terrorism-related sanctions 
                            with respect to Iranian financial 
                            institutions.
TITLE III--SANCTIONS WITH RESPECT TO THE DEVELOPMENT AND USE OF IRANIAN 
                            DIGITAL CURRENCY

Sec. 301. Definitions.
Sec. 302. Findings.
Sec. 303. Prohibition on transactions related to, provision of 
                            financing for, and other dealings in 
                            Iranian digital currency.
Sec. 304. Sanctions with respect to foreign persons that engage in 
                            significant transactions for the sale, 
                            supply, or transfer to Iran of significant 
                            goods or services used in connection with 
                            the development of Iranian digital 
                            currency.
Sec. 305. Sanctions with respect to foreign persons that conduct or 
                            facilitate significant transactions related 
                            to the purchase or sale of Iranian digital 
                            currency or maintain significant amounts in 
                            Iranian digital currency.
Sec. 306. Report on progress of Government of Iran in creating a 
                            sovereign cryptocurrency.

   TITLE I--STRENGTHENING EXISTING SANCTIONS WITH RESPECT TO IRAN TO 
  ACCOUNT FOR ALL SANCTIONABLE ACTIVITY, INCLUDING HUMAN RIGHTS ABUSES

SEC. 101. FINDINGS.

    Congress finds the following:
            (1) On November 5, 2018, the Secretary of the Treasury for 
        the first time sanctioned Iranian banks for having materially 
        assisted, sponsored, or provided financial, material, or 
        technological support for, or goods or services to or in 
        support of the human rights abuses of the Government of Iran, 
        including--
                    (A) Ghavamin Bank, for providing services to the 
                Law Enforcement Forces of Iran, which had been 
                designated for complicity ``in serious human rights 
                abuses in Iran, including operating detention centers 
                where detained protestors were deprived of basic needs 
                such as medical care''; and
                    (B) Ayandeh Bank, for providing services to the 
                Islamic Republic of Iran Broadcasting, Iran's state-
                media apparatus, which had been designated for 
                ``restricting or denying the free flow of information 
                to or from the Iranian people . . . [and] was 
                implicated in censoring multiple media outlets and 
                airing forced confessions from political detainees''.
            (2) Section 220 of the Iran Threat Reduction and Syria 
        Human Rights Act of 2012 (22 U.S.C. 8726) authorizes the 
        imposition of sanctions with respect to persons who knowingly 
        and directly provide specialized financial messaging services 
        to, or knowingly enable or facilitate direct or indirect access 
        to such messaging services for, the Central Bank of Iran or 
        certain other sanctioned Iranian financial institutions.

SEC. 102. EXPANSION OF PROHIBITIONS ON CORRESPONDENT ACCOUNTS OR 
              PAYABLE-THROUGH ACCOUNTS FOR FOREIGN FINANCIAL 
              INSTITUTIONS THAT FACILITATE TRANSACTIONS OR PROVIDE 
              FINANCIAL SERVICES FOR CERTAIN IRANIAN FINANCIAL 
              INSTITUTIONS.

    Section 104(c)(2)(E) of the Comprehensive Iran Sanctions, 
Accountability, and Divestment Act of 2010 (22 U.S.C. 8513(c)(2)(E)) is 
amended--
            (1) in clause (i), by striking ``or'' at the end;
            (2) in clause (ii)(II), by striking the period at the end 
        and inserting ``; or''; and
            (3) by adding at the end the following:
                            ``(iii) an Iranian financial institution 
                        included on the list of specially designated 
                        nationals and blocked persons maintained by the 
                        Office of Foreign Assets Control of the 
                        Department of the Treasury.''.

SEC. 103. EXPANSION OF SANCTIONS WITH RESPECT TO PERSONS KNOWINGLY AND 
              DIRECTLY PROVIDING SPECIALIZED FINANCIAL MESSAGING 
              SERVICES TO, OR ENABLING OR FACILITATING DIRECT OR 
              INDIRECT ACCESS TO SUCH MESSAGING SERVICES FOR, THE 
              CENTRAL BANK OF IRAN, OTHER DESIGNATED IRANIAN BANKS, OR 
              IRANIAN FINANCIAL INSTITUTIONS REMOVED FROM THE LIST OF 
              SPECIALLY DESIGNATED PERSONS PURSUANT TO THE 
              IMPLEMENTATION OF THE JOINT COMPREHENSIVE PLAN OF ACTION.

    (a) In General.--Section 220 of the Iran Threat Reduction and Syria 
Human Rights Act of 2012 (22 U.S.C. 8726) is amended--
            (1) in the section header, by striking ``authorization 
        of'';
            (2) in subsection (b)--
                    (A) in paragraph (1)--
                            (i) in subparagraph (A), by striking ``or a 
                        financial institution described in section 
                        104(c)(2)(E)(ii) of the Comprehensive Iran 
                        Sanctions, Accountability, and Divestment Act 
                        of 2010 (22 U.S.C. 8513(c)(2)(E)(ii))'' and 
                        inserting ``, a financial institution described 
                        in clause (ii) or (iii) of section 104(c)(2)(E) 
                        of the Comprehensive Iran Sanctions, 
                        Accountability, and Divestment Act of 2010 (22 
                        U.S.C. 8513(c)(2)(E)), or a financial 
                        institution that was removed from the list of 
                        specially designated nationals and blocked 
                        persons maintained by the Office of Foreign 
                        Assets Control of the Department of the 
                        Treasury pursuant to the implementation of the 
                        Joint Comprehensive Plan of Action''; and
                            (ii) in subparagraph (B), by striking 
                        ``that section'' and inserting ``subparagraph 
                        (A)''; and
                    (B) in paragraph (2), by striking ``or a financial 
                institution described in section 104(c)(2)(E)(ii) of 
                the Comprehensive Iran Sanctions, Accountability, and 
                Divestment Act of 2010 (22 U.S.C. 8513(c)(2)(E)(ii))'' 
                and inserting ``, a financial institution described in 
                clause (ii) or (iii) of section 104(c)(2)(E) of the 
                Comprehensive Iran Sanctions, Accountability, and 
                Divestment Act of 2010 (22 U.S.C. 8513(c)(2)(E)), or a 
                financial institution that was removed from the list of 
                specially designated nationals and blocked persons 
                maintained by the Office of Foreign Assets Control of 
                the Department of the Treasury pursuant to the 
                implementation of the Joint Comprehensive Plan of 
                Action'';
            (3) in subsection (c)--
                    (A) in the subsection header, by striking 
                ``Authorization of Imposition'' and inserting 
                ``Imposition'';
                    (B) in paragraph (1)--
                            (i) by striking ``the date that is 90 days 
                        after the date of the enactment of this Act'' 
                        and inserting ``the date of the enactment of 
                        the Blocking Iranian Illicit Finance Act'';
                            (ii) by striking ``or a financial 
                        institution described in paragraph (2)(E)(ii) 
                        of section 104(c) of the Comprehensive Iran 
                        Sanctions, Accountability, and Divestment Act 
                        of 2010 (22 U.S.C. 8513(c))'' and inserting ``, 
                        a financial institution described in clause 
                        (ii) or (iii) of paragraph (2)(E) of section 
                        104(c) of the Comprehensive Iran Sanctions, 
                        Accountability, and Divestment Act of 2010 (22 
                        U.S.C. 8513(c)), or a financial institution 
                        that was removed from the list of specially 
                        designated nationals and blocked persons 
                        maintained by the Office of Foreign Assets 
                        Control of the Department of the Treasury 
                        pursuant to the implementation of the Joint 
                        Comprehensive Plan of Action''; and
                            (iii) by striking ``the President may'' and 
                        inserting ``the President shall''; and
                    (C) in paragraph (2)--
                            (i) in the matter preceding subparagraph 
                        (A), by striking ``section 104(c)(2)(E)(ii) of 
                        the Comprehensive Iran Sanctions, 
                        Accountability, and Divestment Act of 2010 (22 
                        U.S.C. 8513(c)(2)(E)(ii))'' and inserting 
                        ``that paragraph''; and
                            (ii) in subparagraph (A)(ii)(I), by 
                        striking ``section 104(c)(2)(E)(ii) of the 
                        Comprehensive Iran Sanctions, Accountability, 
                        and Divestment Act of 2010 (22 U.S.C. 
                        8513(c)(2)(E)(ii))'' and inserting ``paragraph 
                        (1)''; and
            (4) by adding at the end the following:
    ``(e) Joint Comprehensive Plan of Action Defined.--In this section, 
the term `Joint Comprehensive Plan of Action' means the Joint 
Comprehensive Plan of Action agreed to at Vienna on July 14, 2015, by 
Iran and by France, Germany, the Russian Federation, the People's 
Republic of China, the United Kingdom, and the United States, and all 
implementing materials and agreements related to the Joint 
Comprehensive Plan of Action.''.
    (b) Clerical Amendment.--The table of contents for the Iran Threat 
Reduction and Syria Human Rights Act of 2012 is amended by striking the 
item relating to section 220 and inserting the following:

``Sec. 220. Reports on, and imposition of sanctions with respect to, 
                            the provision of specialized financial 
                            messaging services to the Central Bank of 
                            Iran and other sanctioned Iranian financial 
                            institutions.''.

   TITLE II--NEW SANCTIONS AUTHORITIES WITH RESPECT TO IRANIAN BANKS

SEC. 201. FINDINGS.

    Congress finds the following:
            (1) On May 8, 2018, the President issued National Security 
        Presidential Memorandum 11 entitled ``Ceasing United States 
        Participation in the Joint Comprehensive Plan of Action and 
        Taking Additional Action to Counter Iran's Malign Influence and 
        Deny Iran All Paths to a Nuclear Weapon'', that--
                    (A) established that ``it is in the national 
                interest of the United States to re-impose sanctions 
                lifted or waived in connection with the JCPOA as 
                expeditiously as possible''; and
                    (B) instructed the Secretary of State and the 
                Secretary of the Treasury to ``immediately begin taking 
                steps to reimpose all United States sanctions lifted or 
                waived in connection with the JCPOA, including those 
                under the National Defense Authorization Act for Fiscal 
                Year 2012, the Iran Sanctions Act of 1996, the Iran 
                Threat Reduction and Syria Human Rights Act of 2012, 
                and the Iran Freedom and Counterproliferation Act of 
                2012''.
            (2) Section 1245(b) of the National Defense Authorization 
        Act for Fiscal Year 2012 (22 U.S.C. 8513a(b)) designated the 
        financial sector of Iran, including the Central Bank of Iran, 
        as a jurisdiction of primary money laundering concern for 
        purposes of section 5318A of title 31, United States Code, 
        ``because of the threat to government and financial 
        institutions resulting from the illicit activities of the 
        Government of Iran, including its pursuit of nuclear weapons, 
        support for international terrorism, and efforts to deceive 
        responsible financial institutions and evade sanctions''.
            (3) Since October 2007, the Financial Action Task Force, an 
        intergovernmental organization that sets standards and promotes 
        implementation of measures to combat money laundering, 
        terrorist financing, and related threats to the integrity of 
        the international financial system, identified Iran as posing a 
        ``significant vulnerability within the international financial 
        system'' due to deficiencies in Iran's antimoney laundering 
        efforts and efforts to combat the financing of terrorism 
        (collectively known as Iran's AML/CFT regime).
            (4) On November 25, 2011, the Secretary of the Treasury 
        issued a finding under section 5318A of title 31, United States 
        Code, that reasonable grounds exist for concluding that Iran is 
        a jurisdiction of primary money laundering concern.
            (5) Since June 2016, the Financial Action Task Force has 
        ``welcomed Iran's high-level political commitment to address 
        its strategic AML/CFT deficiencies, and its decision to seek 
        technical assistance in the implementation of the Action 
        Plan'', but--
                    (A) on September 2, 2017, Iranian Defense Minister 
                Amir Hatami stated that Iran would increase its support 
                for terrorist groups such as Hezbollah, stating that 
                ``perhaps the main fear of the arrogant powers about 
                our relationship with the resistance axis is that they 
                do not want such a pattern to see the light of day'';
                    (B) on October 8, 2018, the Iranian parliament 
                approved a bill authorizing Iran to join the 
                International Convention for the Suppression of the 
                Financing of Terrorism, but included exemptions for 
                continued financing of terror organizations such as 
                Hamas and Hezbollah; and
                    (C) on October 19, 2018, the Financial Action Task 
                Force issued a statement noting that ``Iran's action 
                plan expired in January 2018 . . . [and] the majority 
                of the Action Plan remains outstanding . . . Until Iran 
                implements the measures required to address the 
                deficiencies identified in the Action Plan, the FATF 
                will remain concerned with the terrorist financing risk 
                emanating from Iran and the threat this poses to the 
                international financial system.''.
            (6) On October 11, 2018, the Financial Crimes Enforcement 
        Network issued an advisory that ``Some of the methods used by 
        the Iranian regime to access the financial system through 
        covert means and to further its malign activities include 
        misusing banks and exchange houses, operating procurement 
        networks that utilize front or shell companies, exploiting 
        commercial shipping, and masking illicit transactions using 
        senior officials . . . FinCEN expects that Iranian financial 
        institutions, the Iranian regime, and its officials will 
        increase their efforts to evade U.S. sanctions to fund malign 
        activities and secure hard currency for the Government of Iran, 
        following the re-imposition of sanctions lifted under the 
        JCPOA.''.

SEC. 202. ISSUANCE OF FINAL RULE REGARDING APPLICATION OF SPECIAL 
              MEASURES WITH RESPECT TO IRAN IN CONNECTION WITH 
              DESIGNATION AS JURISDICTION OF PRIMARY MONEY LAUNDERING 
              CONCERN.

    Not later than 90 days after the date of the enactment of this Act, 
the Secretary of the Treasury shall issue a final rule pursuant to 
section 5318A of title 31, United States Code, that--
            (1) applies the measures described in paragraph (5) of 
        subsection (b) of that section with respect to Iran; and
            (2) applies such other measures described in that 
        subsection with respect to Iran as the Secretary considers 
        appropriate.

SEC. 203. IMPOSITION OF SANCTIONS WITH RESPECT TO FINANCIAL SECTOR OF 
              IRAN.

    (a) Sanctions With Respect to Sectors of the Economy of Iran.--
            (1) In general.--Section 1244 of the Iran Freedom and 
        Counter-Proliferation Act of 2012 (22 U.S.C. 8803) is amended--
                    (A) in the section header, by striking ``and 
                shipbuilding'' and inserting ``shipbuilding, and 
                financial'';
                    (B) in subsection (a)(1), by striking ``and 
                shipbuilding'' and inserting ``shipbuilding, and 
                financial'';
                    (C) in subsection (b)--
                            (i) in the subsection header, by striking 
                        ``and Shipbuilding'' and inserting 
                        ``Shipbuilding, and Financial''; and
                            (ii) by striking ``and shipbuilding'' and 
                        inserting ``shipbuilding, and financial'';
                    (D) in subsection (c)--
                            (i) in the subsection header, by striking 
                        ``and Shipbuilding'' and inserting 
                        ``Shipbuilding, and Financial'';
                            (ii) in paragraph (2)--
                                    (I) in subparagraph (A), by 
                                striking ``or shipbuilding'' and 
                                inserting ``shipbuilding, or 
                                financial''; and
                                    (II) in subparagraph (C)--
                                            (aa) in clause (i), by 
                                        striking ``or shipbuilding'' 
                                        and inserting ``shipbuilding, 
                                        or financial''; and
                                            (bb) in clause (iii), by 
                                        striking ``(other than an 
                                        Iranian financial institution 
                                        described in paragraph (3))''; 
                                        and
                            (iii) by striking paragraph (3); and
                    (E) in subsection (d)--
                            (i) in the subsection header, by striking 
                        ``and Shipbuilding'' and inserting 
                        ``Shipbuilding, and Financial''; and
                            (ii) in paragraph (3), by striking ``or 
                        shipbuilding'' and inserting ``shipbuilding, or 
                        financial''.
            (2) Clerical amendment.--The table of contents for the Iran 
        Freedom and Counter-Proliferation Act of 2012 is amended by 
        striking the item relating to section 1244 and inserting the 
        following:

``Sec. 1244. Imposition of sanctions with respect to the energy, 
                            shipping, shipbuilding, and financial 
                            sectors of Iran.''.
    (b) Sanctions With Respect to Sale, Supply, or Transfer of Certain 
Materials.--
            (1) In general.--Section 1245 of the Iran Freedom and 
        Counter-Proliferation Act of 2012 (22 U.S.C. 8804) is amended--
                    (A) in subsection (a)(1)(C)(i)--
                            (i) in subclause (I), by striking ``or 
                        shipbuilding'' and inserting ``shipbuilding, or 
                        financial''; and
                            (ii) in subclause (II), by striking 
                        ``(other than an Iranian financial institution 
                        described in subsection (b))'';
                    (B) by striking subsection (b); and
                    (C) by redesignating subsections (c) through (h) as 
                subsections (b) through (g), respectively.
            (2) Conforming amendments.--
                    (A) In general.--Such section is further amended--
                            (i) in subsection (a)(1)--
                                    (I) in subparagraph (B)--
                                            (aa) by striking 
                                        ``subsection (d)'' and 
                                        inserting ``subsection (c)''; 
                                        and
                                            (bb) by striking 
                                        ``subsection (e)(1)'' and 
                                        inserting ``subsection 
                                        (d)(1)''; and
                                    (II) in subparagraph (C)--
                                            (aa) in the matter 
                                        preceding clause (i), by 
                                        striking ``subsection (d)'' and 
                                        inserting ``subsection (c)''; 
                                        and
                                            (bb) in clause (i)--

                                                    (AA) in subclause 
                                                (I), by striking 
                                                ``subsection (e)(2)'' 
                                                and inserting 
                                                ``subsection (d)(2)''; 
                                                and

                                                    (BB) in subclause 
                                                (III), by striking 
                                                ``subsection (e)(3)'' 
                                                and inserting 
                                                ``subsection (d)(3)'';

                            (ii) in subsection (d), as redesignated by 
                        paragraph (1)(C)--
                                    (I) in paragraph (1)(A), by 
                                striking ``subsection (d)'' and 
                                inserting ``subsection (c)''; and
                                    (II) in paragraph (3), by striking 
                                ``subsection (d)'' and inserting 
                                ``subsection (c)''; and
                            (iii) in subsection (e), as so 
                        redesignated, by striking ``subsection (a) or 
                        (c)'' and inserting ``subsection (a) or (b)''.
                    (B) Sanctions with respect to underwriting services 
                or insurance or reinsurance.--Section 1246(a)(1)(B)(ii) 
                of the Iran Freedom and Counter-Proliferation Act of 
                2012 (22 U.S.C. 8805(a)(1)(B)(ii)) is amended by 
                striking ``section 1245(d)'' and inserting ``section 
                1245(c)''.
                    (C) Application of iran sanctions act of 1996.--
                Section 1253(c) of the Iran Freedom and Counter-
                Proliferation Act of 2012 (22 U.S.C. 8809(c)) is 
                amended by striking ``1245(g)'' and inserting 
                ``1245(f)''.
    (c) Sanctions With Respect to Underwriting Services or Insurance or 
Reinsurance.--
            (1) In general.--Section 1246 of the Iran Freedom and 
        Counter-Proliferation Act of 2012 (22 U.S.C. 8805) is amended--
                    (A) in subsection (a)(1)--
                            (i) in subparagraph (B)(i), by striking 
                        ``or shipbuilding'' and inserting 
                        ``shipbuilding, or financial''; and
                            (ii) in subparagraph (C), by striking 
                        ``(other than an Iranian financial institution 
                        described in subsection (b))'';
                    (B) by striking subsection (b); and
                    (C) by redesignating subsections (c), (d), and (e) 
                as subsections (b), (c), and (d), respectively.
            (2) Conforming amendment.--Section 1253(c) of the Iran 
        Freedom and Counter-Proliferation Act of 2012 (22 U.S.C. 
        8809(c)) is amended by striking ``1246(e)'' and inserting 
        ``1246(d)''.

SEC. 204. AUTHORIZATION OF IMPOSITION OF TERRORISM-RELATED SANCTIONS 
              WITH RESPECT TO IRANIAN FINANCIAL INSTITUTIONS.

    (a) In General.--The Comprehensive Iran Sanctions, Accountability, 
and Divestment Act of 2010 (22 U.S.C. 8501 et seq.) is amended by 
inserting after section 104A the following:

``SEC. 104B. AUTHORIZATION OF IMPOSITION OF TERRORISM-RELATED SANCTIONS 
              WITH RESPECT TO IRANIAN FINANCIAL INSTITUTIONS.

    ``(a) In General.--The President may impose the sanctions described 
in subsection (b) with respect to an Iranian financial institution and 
any foreign person that is an official, agent, or affiliate of an 
Iranian financial institution.
    ``(b) Sanctions Described.--The sanctions described in this 
subsection are sanctions applicable with respect to a foreign person 
pursuant to Executive Order No. 13224 (50 U.S.C. 1701 note; relating to 
blocking property and prohibiting transactions with persons who commit, 
threaten to commit, or support terrorism).
    ``(c) Iranian Financial Institution Defined.--In this section, the 
term `Iranian financial institution' has the meaning given that term in 
section 104A(d)(3).''.
    (b) Clerical Amendment.--The table of contents for the 
Comprehensive Iran Sanctions, Accountability, and Divestment Act of 
2010 (22 U.S.C. 8501 et seq.) is amended by inserting after the item 
relating to section 104A the following:

``Sec. 104B. Authorization of imposition of terrorism-related sanctions 
                            with respect to Iranian financial 
                            institutions.''.

TITLE III--SANCTIONS WITH RESPECT TO THE DEVELOPMENT AND USE OF IRANIAN 
                            DIGITAL CURRENCY

SEC. 301. DEFINITIONS.

    In this title:
            (1) Correspondent account; payable-through account.--The 
        terms ``correspondent account'' and ``payable-through account'' 
        have the meanings given those terms in section 5318A of title 
        31, United States Code.
            (2) Digital currency exchange.--The term ``digital currency 
        exchange'' means any organization, association, or group of 
        persons, whether incorporated or unincorporated, which 
        constitutes, maintains, or provides a market place or 
        facilities for bringing together purchasers and sellers of 
        digital currencies or for otherwise performing with respect to 
        digital currencies the functions commonly performed by an 
        exchange as that term is generally understood, and includes the 
        market place and the market facilities maintained by such 
        digital currency exchange.
            (3) Foreign person.--The term ``foreign person'' means a 
        person that is not a United States person.
            (4) Iranian digital currency.--The term ``Iranian digital 
        currency'' means any digital currency, digital coin, or digital 
        token that was issued by, for, or on behalf of the Government 
        of Iran.
            (5) United states person.--The term ``United States 
        person'' means any United States citizen, permanent resident 
        alien, entity organized under the laws of the United States or 
        any jurisdiction within the United States (including foreign 
        branches), or person in the United States.

SEC. 302. FINDINGS.

    Congress makes the following findings:
            (1) On February 13, 2018, the Under Secretary of the 
        Treasury for Terrorism and Financial Intelligence stated that 
        ``Rogue regimes like Venezuela experiment with and use digital 
        and virtual currencies to hide their ill-gotten gains and 
        finance their illicit activities. Recently, for example, 
        Venezuela announced plans to create the `petro' digital 
        currency to try and sidestep our powerful sanctions.''.
            (2) In April 2018, the Minister of Information and 
        Communications Technology of Iran stated that ``the 
        experimental model was ready'' for a digital currency developed 
        by the Government of Iran.
            (3) In June 2018, the Deputy for Management and Investment 
        at the Directorate for Scientific and Technological Affairs of 
        Iran stated that ``We are trying to prepare the grounds to use 
        a domestic digital currency in the country . . . This currency 
        would facilitate the transfer of money (to and from) anywhere 
        in the world. Besides, it can help us at the time of 
        sanctions.''.
            (4) In October 2018, the head of the Civil Defense 
        Organization of Iran stated that ``cryptocurrencies can help 
        bypass certain sanctions through untraceable banking 
        operations''.

SEC. 303. PROHIBITION ON TRANSACTIONS RELATED TO, PROVISION OF 
              FINANCING FOR, AND OTHER DEALINGS IN IRANIAN DIGITAL 
              CURRENCY.

    (a) In General.--All transactions related to, provision of 
financing for, and other dealings in Iranian digital currency by a 
United States person or within the United States are prohibited.
    (b) Penalties.--The penalties provided for in subsections (b) and 
(c) of section 206 of the International Emergency Economic Powers Act 
(50 U.S.C. 1705) shall apply to a person that knowingly violates, 
attempts to violate, conspires to violate, or causes a violation of 
subsection (a) to the same extent that such penalties apply to a person 
that knowingly commits an unlawful act described in section 206(a) of 
such Act.

SEC. 304. SANCTIONS WITH RESPECT TO FOREIGN PERSONS THAT ENGAGE IN 
              SIGNIFICANT TRANSACTIONS FOR THE SALE, SUPPLY, OR 
              TRANSFER TO IRAN OF SIGNIFICANT GOODS OR SERVICES USED IN 
              CONNECTION WITH THE DEVELOPMENT OF IRANIAN DIGITAL 
              CURRENCY.

    The President shall impose 5 or more of the sanctions described in 
section 6(a) of the Iran Sanctions Act of 1996 (Public Law 104-172; 50 
U.S.C. 1701 note) with respect to any foreign person that the President 
determines knowingly engages, on or after the date of the enactment of 
this Act, in a significant transaction for the sale, supply, or 
transfer to Iran of significant goods or services, or technological 
support, used in connection with the development of Iranian digital 
currency.

SEC. 305. SANCTIONS WITH RESPECT TO FOREIGN PERSONS THAT CONDUCT OR 
              FACILITATE SIGNIFICANT TRANSACTIONS RELATED TO THE 
              PURCHASE OR SALE OF IRANIAN DIGITAL CURRENCY OR MAINTAIN 
              SIGNIFICANT AMOUNTS IN IRANIAN DIGITAL CURRENCY.

    (a) In General.--The President may impose the sanctions described 
in subsection (b) with respect to a foreign person if the President 
determines that the foreign person, on or after the date of the 
enactment of this Act--
            (1) knowingly conducts or facilitates any significant 
        transaction related to the purchase or sale of Iranian digital 
        currency or a derivative, swap, future, forward, or other 
        similar contract the value of which is based on the exchange 
        rate of Iranian digital currency; or
            (2) maintains significant amounts denominated in Iranian 
        digital currency outside the territory of Iran.
    (b) Sanctions Described.--The sanctions to be imposed on a foreign 
person under this subsection are the following:
            (1) Correspondent and payable-through account 
        limitations.--With respect to any digital currency exchange 
        subject to sanctions under subsection (a), prohibiting the 
        opening, and imposing strict conditions on the maintaining, in 
        the United States of a correspondent account or payable-through 
        account by the digital currency exchange.
            (2) Blocking of property.--Blocking and prohibiting all 
        transactions in all property and interests in property of the 
        foreign person if such property and interests in property are 
        in the United States, come within the United States, or are or 
        come within the possession or control of a United States 
        person.
            (3) Visa ban.--With respect to a foreign person who is an 
        alien, inadmissibility to the United States and ineligibility 
        to receive a visa or other documentation to enter the United 
        States.
    (c) Exception To Comply With United Nations Headquarters Agreement 
and Other International Obligations.--The sanctions under subsection 
(b)(3) may not be imposed on an individual if admitting that individual 
to the United States is necessary to permit the United States to comply 
with the Agreement regarding the Headquarters of the United Nations, 
signed at Lake Success June 26, 1947, and entered into force November 
21, 1947, between the United Nations and the United States, or with 
other applicable international obligations.

SEC. 306. REPORT ON PROGRESS OF GOVERNMENT OF IRAN IN CREATING A 
              SOVEREIGN CRYPTOCURRENCY.

    (a) In General.--Not later than 120 days after the date of the 
enactment of this Act, the Secretary of the Treasury shall submit to 
Congress a report on the status of the progress of the Government of 
Iran in creating a sovereign cryptocurrency.
    (b) Elements.--The report required by paragraph (1) shall include 
the following:
            (1) An assessment of the progress of the Government of Iran 
        in creating a sovereign cryptocurrency.
            (2) A description of the technical details of what is being 
        developed, including whether the Government of Iran intends 
        to--
                    (A) fork an existing blockchain or create a new 
                one;
                    (B) make the blockchain open or closed; or
                    (C) involve the Central Bank of Iran.
            (3) An assessment of the state and non-state actors that 
        are assisting the Government of Iran in creating a sovereign 
        cryptocurrency, including the governments of the People's 
        Republic of China, the Russian Federation, the Bolivarian 
        Republic of Venezuela, and the Republic of Turkey.
            (4) An assessment of the effect that successful 
        development, deployment, and maintenance by the Government of 
        Iran of a sovereign cryptocurrency would have on the 
        effectiveness of existing United States sanctions with respect 
        to Iran.
            (5) An assessment of the technology and infrastructure that 
        the Government of Iran would need to develop, deploy, and 
        maintain a national digital currency, including a 
        cryptocurrency.
            (6) An identification of the countries that have agreed to 
        assist the United States in blocking efforts to bypass or evade 
        United States sanctions relating to Iran or bypass or evade 
        countermeasures and risk mitigation practices outlined by the 
        Financial Action Task Force.
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