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U.S. Treasury to Freeze Assets of Syrian Bank, Phone Company

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Aug. 10 (Bloomberg) -- The U.S. Treasury Department said today that it will freeze the assets of the Commercial Bank of Syria; the Syrian Lebanese Commercial Bank, a subsidiary; and the mobile phone company Syriatel for supporting Syrian and North Korean weapons programs.

“We are taking aim at the financial infrastructure that is helping provide support” to Syrian President Bashar al-Assad, David Cohen, under secretary for terrorism and financial intelligence, said in a Treasury press statement.

Assad has sparked international criticism for a deadly five-month crackdown on dissidents. Saudi Arabia, Kuwait and Bahrain have withdrawn their ambassadors from Damascus, and Turkey said its neighbor is entering a “critical” period. U.S. President Barack Obama has said Assad is losing legitimacy as a leader, stopping short of calling for him to step down.

“Syria would be better off without President Assad,” White House press secretary Jay Carney said at a briefing today. It’s most important for the U.S. “to ensure our actions back up our words,” he also said.

The U.S. is interested in tougher sanctions on the country, including possible action on oil and gas, State Department spokeswoman Victoria Nuland told reporters yesterday in Washington.

Pressure is mounting at the United Nations for a formal resolution against the bloodshed. UN Secretary-General Ban Ki-moon will provide an update on the deepening violence in Syria to the Security Council today, a week after it condemned Assad’s use of force against civilians in a statement that fell short of the resolution Europe and the U.S. sought.

Weapons Ties

The Treasury Department statement said it sanctioned the Commercial Bank of Syria because it provided financial services to Syria’s Scientific Studies and Research Center and North Korea’s Tanchon Commercial Bank.

The Syrian research center controls the country’s missile production facilities and manages Syria’s development of unconventional weapons, according to the Treasury statement.

Tanchon is the primary financial agent for the Korea Mining Development Corp., North Korea’s main arms dealer, the statement said.

The bank also has had dealings with several Iranian banks that have been sanctioned by the U.S., the statement said.

Syriatel is owned and run by Rami Makhluf, a “regime insider” who has contributed to the corruption of Syrian public officials, the Treasury Department said.

To contact the reporter on this story: Jeff Bliss in Washington at jbliss@bloomberg.net

To contact the editor responsible for this story: Mark Silva at msilva34@bloomberg.net

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