For years, various Iranian businesses have used the small Caucasian republic as a conduit for various sanctions-busting schemes. The Georgian government, at the urging of the U.S. Treasury Department, cracked down on these businesses, and seems to have made a good-faith effort at enforcement, but unplugged holes undoubtedly remain. Emanuele Ottolenghi describes how the sanctions are evaded, and the significance of the problem for a prospective nuclear deal:

It looked as if Treasury’s actions constituted a textbook case in the success of the U.S. sanctions policy. By making a compelling case to a foreign ally through Treasury’s painstaking forensic work, the Obama administration had neutralized an important illicit Iranian operation there and potentially damaged others. Yet in fact the [episode] encapsulates sanctions’ main challenge. Enforcing them requires tedious bookkeeping, painstaking forensic work, and the ability to stay a step ahead of Iranian middlemen with three decades of experience circumventing embargoes. These difficulties, which are painfully obvious on the ground, suggest that President Barack Obama’s faith in “snap-back sanctions” that will penalize Iran if it violates the terms of any nuclear deal take little account of how sanctions actually work on the ground. . . .

Treasury took two years to discover, investigate, corroborate, and finally sanction the people they eventually designated as Iran’s proxies in Georgia. Even so, Treasury targeted only eight of the eighteen businesses mentioned in Georgian court proceedings. It is, of course, entirely possible that only those eight companies engaged in sanctionable activities, while all others were honest businesses. However, the pending Georgian court case against more of their companies, relatives, and business partners suggests a possible alternative explanation. It is also plausible that Treasury could not gather sufficient evidence against those companies or that it failed to identify them. If that were the case, it would expose the constraints of an effective sanctions policy.

Treasury’s actions . . . happened at the height of the sanctions regime, when compliance with U.S. sanctions among financial institutions, global businesses, and foreign governments was at its zenith. It will be much harder in a post-sanctions environment. . . . Iran’s evasive action could then start over again, at even higher stakes. . . . Unless sanctions enforcement is relentless, Western successes rarely translate into Iranian failures; just temporary setbacks.

If Iran succeeds in obtaining nuclear weapons, the war in Gaza, let alone the protests on college campuses, will seem like a minor complication. Jonathan Schachter fears that this danger could be much more imminent than decisionmakers in Jerusalem and Washington believe. In his view, Israel seems to be repeating the mistake that allowed it to be taken by surprise on Simchat Torah of 2023 and Yom Kippur of 1973: putting too much faith in an intelligence concept that could be wrong.

Israel and the United States apparently believe that despite Iran’s well-documented progress in developing capabilities necessary for producing and delivering nuclear weapons, as well as its extensive and ongoing record of violating its international nuclear obligations, there is no acute crisis because building a bomb would take time, would be observable, and could be stopped by force. Taken together, these assumptions and their moderating impact on Israeli and American policy form a new Iran concept reminiscent of its 1973 namesake and of the systemic failures that preceded the October 7 massacre.

Meanwhile, most of the restrictions put in place by the 2015 nuclear deal will expire by the end of next year, rendering the question of Iran’s adherence moot. And the forces that could be taking action aren’t:

The European Union regularly issues boilerplate press releases asserting its members’ “grave concern.” American decisionmakers and spokespeople have created the unmistakable impression that their reservations about the use of force are stronger than their commitment to use force to prevent an Iranian atomic bomb. At the same time, the U.S. refuses to enforce its own sanctions comprehensively: Iranian oil exports (especially to China) and foreign-currency reserves have ballooned since January 2021, when the Biden administration took office.

Israel’s response has also been sluggish and ambiguous. Despite its oft-stated policy of never allowing a nuclear Iran, Israel’s words and deeds have sent mixed messages to allies and adversaries—perhaps inadvertently reinforcing the prevailing sense in Washington and elsewhere that Iran’s nuclear efforts do not present an exigent crisis.