U.S. congressmen slam bank over Iran

December 21, 2008

WASHINGTON (JTA) -- Eight Congress members demanded answers from the U.S. Export-Import Bank over its loan guarantees to companies linked to Iran.

The bank, an independent government agency that promotes U.S. trade by providing credit for deals that other insurers avoid, has underwritten $900 million in loan guarantees to U.S. companies that supply equipment to Reliance Industries, a company that refines gasoline. Reliance exports refined petroleum to Iran; the Islamic Republic imports as much as 40 percent of its refined gasoline because, although it is a major oil producer, its own refineries are in disarray.

The bank has already responded to Senate queries about the deal, but a letter sent Dec. 17 by the bipartisan slate of eight members of the U.S. House of Representatives said its answers described an examination of its dealings with Reliance that was "perfunctory at best."

"We are deeply concerned about the inadequate attention paid to other vital national interests in the approval of these guarantees," said the letter.

The letter suggests that the bank is overly focused on the commercial appeal of its underwritings, and should take into account U.S. foreign policy and calls on Reliance to stop exports to Iran before any further disbursements of guarantees are made.

A number of congressional resolutions in recent years, backed by the American Israel Public Affairs Committee, have called for measures that would cripple Iran's energy sector as a disincentive against sustaining a suspected nuclear weapons program.

"We could greatly increase our leverage against Tehran in the dispute over its nuclear program by encouraging those supplying them with gasoline to halt their trade with Iran," said Rep. Brad Sherman (D-Calif.), one of the signatories.

The other signatories are Reps. Mark Kirk (R-Ill.); Howard Berman (D-Calif.), the chairman of the House's Foreign Affairs Committee; Ed Royce (R-Calif.); Steve Israel (D-N.Y.); Steve Rothman (D-N.J.); Ron Klein (D-Fla.); and Gary Ackerman (D-N.Y.), the chairman of the House's Middle East and South Asia subcommittee.

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