(FinancialTime.com) - The US is seeking to increase economic pressure on Iran, even as its partners in the European Union talk to the Islamic Republic about beginning formal negotiations on Tehran's nuclear programme, reports Trend.
Hank Paulson, the new US Treasury secretary, is personally lobbying finance ministers and central bank governors to ensure their national financial systems are not used by Iranian entities involved in proliferation or terrorism finance.
But his efforts have irritated some European officials, who have objected to what they see as Washington's moves to impose sanctions on Iran through the back door.
The EU has joined with the US in threatening sanctions against Tehran unless it scales down its nuclear programme. But the bloc is also conducting a diplomatic push to open negotiations as an alternative to sanctions - which, in any case, face serious obstacles at the UN.
Speaking at the annual meeting of the International Monetary Fund and World Bank in Singapore, Mr Paulson said Iran abused the global financial system to "procure technology that is going to aid in the production of weapons of mass destruction" and is "actively invol-ved in financing terrorists".
He added that the US had evidence that "blue chip banks" as well as other financial institutions were being used by an Iranian network of "more than 30 front companies".
The US has dispatched Treasury officials around the world to share declassified intelligence with foreign regulators on Iran's alleged abuse of the global financial system and to warn banks against becoming inadvertently involved.
The US Treasury secretary said the campaign was "nothing more than an educational briefing".
But EU officials refused to add any specific reference to Iran in a group of seven leading economies communiquГ© on Saturday, indicating instead that the US should name the front companies so that action could be taken.
Iran denies having or making weapons of mass des-truction. In addition, the EU also does not classify Hizbollah, the Islamist group allied to Tehran, as a terrorist organisation.
JoaquГn Almunia, the Europan economic and monetary affairs commissioner, said: "As far as I know the Iran war was not on the G7 communiquГ©."
Any moves towards imposing UN sanctions on Iran are complicated by resistance from Russia and China, which have economic ties to Tehran and reiterated their reservations at the weekend.
Against such a backdrop, the US has sought to bring together a "coalition of concerned countries" to impose financial restrictions on Iran. Since the key players in such a coalition would be the EU and Japan, the natural forum is the G7.
But at present, the EU is in talks with Tehran over a possible deal on the nuclear file, in which Iran would suspend uranium enrichment at the same time as formal negotiations began.
Javier Solana, EU foreign policy chief, is due to meet Ali Larijani, Iran's top nuclear security official, this week in New York. If that goes well, a foreign ministers meeting could be held to begin formal negotiations. This would involve Iran, the EU, Russia and China - but not the US.