During Tuesday’s Senate Banking Committee hearing on Iran sanctions, New Jersey Senator Robert Menendez asked TFI Undersecretary David Cohen a question which has been on our minds for a while now.
“We keep adding sanctions regimes, which we need to… Do you have the wherewithal, the resources, to continue to pursue the sanctions regime we want, b/c if I give you 10-fold work and it still remains the same universe to enforce, I get concerned that your enforcement capability is limited by your resources.”
In this situation, the tendency is to play the good soldier and state that there are sufficient resources to do the task. Instead, Cohen issued the diplomatic equivalent of a cry for help:
“In terms of resources, my team is working flat out. I can tell you we have a lot of important issues on our plate… and we are devoting an enormous amount of energy and resources to implementing the range of sanctions regimes that we have. I think we’re doing a good job of it, but my folks are working very very hard at this.”
Cohen’s plea was not lost on Sen. Menendez, who responded:
“That’s diplomatic speak for, you won’t give me a direct answer that you need more money but it sounds like if you’re working flat out then…”
For anyone who has watched the frenetic pace of designations over the last year or heard the resigned response of an OFAC representative when asked a question about the next round of regulations, it’s clear that TFI is in overdrive at the moment. Unfortunately, even if additional funds are provided to TFI, it’s highly unlikely it will do anything to improve wait times for OFAC license application responses as Congress would more than likely mandate any funding increase go directly into enforcement and designations. However, it does serve to highlight the disconcerting fact that OFAC’s operating budget has only increased a little over 1% per year over the last 5 years, rising from $29.2 million in FY2009 to $30.9 million for FY2013. TFI’s budget has barely increased at all, going from $99.8 millilon in FY 2011 to $100 million for FY2013. Over that same time period, the quantity and complexity of sanctions regulations has exploded.
Regardless, for those who want to see sanctions more stringently enforced, the old adage pro tali numismate tales merces (you get what you pay for) applies. For all of the hand-wringing regarding the administration’s perceived reluctance to bring the full weight of the executive down on Iran, there has been no corresponding push to provide the resources necessary to do so. TFI has done yeoman’s work in making the most of the funding they have, but it is time for Congress to come to terms with the fact that they have left the United States’ financial crime fighters out to dry.