Why isn’t the Obama administration going after Iran’s Mahan Air?

In theory, Iran’s Mahan Air is a private commercial airliner that operates dozens of daily passenger flights to domestic and international destinations. In practice, Mahan might as well rename itself IRGC Air. The U.S. Treasury sanctioned the airline in 2011. Since then, its aircraft have ferried arms and Islamic Revolutionary Guard Corps (IRGC) military personnel to Syria in hundreds of recorded flights.

{mosads}As reports emerged last week that Israel had targeted weapon caches near the Damascus, Syria airport, an old Mahan Air Airbus A306 was taking off from Abadan, an Iranian port city near the Iraqi border and home to a base of the IRGC navy. A second plane followed a few hours later. Since early September, Abadan has been a regular stopover for Mahan’s night flights from Iran to Syria and back. If reports on the Israeli strike are accurate, then Mahan’s late-night flight was most likely an Iranian effort to replenish supplies for its embattled ally the Syrian regime and its proxy militia Hezbollah. It is also a testament to the increasing ineffectiveness of U.S. sanctions.

Because of its role as Iran’s enabler for Syrian President Bashar Assad’s war effort, Mahan will not benefit from the sanctions relief provided under the Iran nuclear deal reached in July. Regardless, Mahan uses its commercial fleet to support Tehran’s regional proxy wars while easily buying planes from European suppliers and getting ground services at foreign destinations. Unless the Obama administration is ready to inflict heavy penalties on firms, especially in Europe, enabling Mahan to continue its operations with impunity, the credibility of current U.S. policy on Iran will be further eroded.

That Mahan Air traffic to Syria can continue unimpeded is a testament to the loss of U.S. leverage in the region. Despite the blood and treasure it spilled in Iraq, the United States cannot get Baghdad to block Iranian deliveries to Syria.

Nor have U.S. efforts to stem aircraft and aircraft part sales to Mahan been overall successful.

Using an Iraqi intermediary, Mahan purchased nine used Airbus jets in May, eight of them from European companies. Then, earlier this month, reports emerged that Mahan had allegedly acquired another aircraft through a South African intermediary, which bought the plane from a British-registered firm. The U.S. Treasury sanctioned the Iraqi and Dubai intermediaries that facilitated the first deal, but has so far refrained from punishing any of the aircraft’s suppliers. No steps have been taken yet against those involved in the more recent sale. And while Mahan Air’s procurement companies in Europe have occasionally been subjected to Temporary Denial Orders from the U.S. Department of Commerce, none of them has ever been designated by Treasury or confronted by local authorities.

Despite U.S. threats to impound the sanctioned airplanes, Mahan is operating them, without fear of reprisal, on international routes that include European destinations such as Milan, Munich and Athens, Greece. Three of them were also used at least once recently to ferry weapons to Syria.

Once in Europe, Mahan gets ground services from local companies, including ramp assistance, baggage and cargo handling, catering, refueling, ticketing, check-in services, and crew handling. None of the service providers has faced penalties yet.

Expecting the Obama administration to have leverage over Baghdad may seem far-fetched. Having withdrawn its forces in 2011, the U.S. can do little to interfere with Mahan’s flights to Damascus. But using Treasury’s power to designate Mahan’s subsidiaries, its intermediaries and those companies in Europe and Asia providing services to its commercial operations, is eminently feasible.

Even at the height of international sanctions, Iran was frequently able to elude financial and commercial restrictions. But U.S. action against companies that, intentionally or unwittingly, enabled Iran to evade sanctions had a chilling effect on others still willing to defy them. Multibillion dollar fines against prominent global financial institutions ensured that to this day most Western banks are reluctant to re-engage Iran’s economy.

The administration could designate Mahan’s front companies in Europe and slap exemplary fines against those involved in aircraft and aircraft spare part sales to Mahan. It could initiate legal action to impound aircraft landing at European airports and admonish companies providing ground services to Mahan Air that they might face steep penalties. It could also pressure U.S. carriers that use the same companies employed by Mahan to drop their contracts.

The Obama administration’s reluctance to act removes any incentive for overseas businesses to deny their services to those still under U.S. sanctions. Mahan’s ability to fly with impunity speaks volumes to the administration’s will to hold Tehran accountable now that the nuclear deal is signed.

Ottolenghi is a senior fellow at the Foundation for Defense of Democracies.