The United States Treasury has imposed sanctions on Mahan Air, the Iranian airline, in retaliation for an alleged plot by Iranian officials to assassinate the Saudi Arab ambassador to the U.S., Adel Al-Jubeir.

The Treasury said that the airline flew members of an Iranian elite Quds Force who are linked to the murder plot that was revealed by the Justice Department on Tuesday.

U.S. officials indicated that the Iranian operatives as well as members of Hezbollah were transported across the Middle East by Mahan.

Under terms of the sanctions, Mahan’s U.S. assets will be frozen and U.S. companies will be prohibited for doing any business with the airline.

Treasury official David Cohen said in a statement: Mahan Air's close co-ordination with the IRGC-QF [Islamic Revolutionary Guards Corp-Quds Force] - secretly ferrying operatives, weapons and funds on its flights - reveals yet another facet of the IRGC's extensive infiltration of Iran's commercial sector to facilitate its support for terrorism.’

Cohen added: Following the revelation about the IRGC-QF's use of the international financial system to fund its murder-for-hire plot, today's action highlights further the undeniable risks of doing business with Iran.

U.S. Attorney General Eric Holder announced Tuesday that two Iranians have been charged in the alleged assassination plot, which he claimed was conceived, sponsored and directed from Iran.

Holder described Iran's alleged involvement in the assassination plot as a flagrant violation of U.S. and international law.

The two men accused in the plot were identified as Mansoor Arbabsiar, a 56-year-old naturalized U.S. citizen with dual Iranian and U.S. passports, and Gholam Shakuri, reportedly a member of Iran's Quds Force, a unit of the Revolutionary Guard Corps. Shakuri is believed to be in Iran.

Three other Iranian men, also described as members of Quds, are also believed to be conspirators.

Allegedly, the Iranians approached an undercover agent for the Drug Enforcement Agency (DEA) and offered him money to kill Adel al-Jubeir, the Saudi envoy to the U.S. The Iranians apparently thought their contact was a member of a Mexican drug cartel.

Meanwhile, U.S. Secretary of State Hillary Clinton described the plot as a dangerous escalation by Iran.

U.S. allies in Europe have also expressed outrage over Iran’s purported actions.

The office of British Prime Minister David Cameron said in a statement: Indications that this plot was directed by elements of the Iranian regime are shocking. We will support measures to hold Iran accountable for its actions.

Catherine Ashton, the foreign policy boss at the European Union (EU), stated through a spokeswoman to Agence France Presse: Should the facts be confirmed, this [plot] would constitute a major breach of international law with serious international implications.”

Also, the Gulf Cooperation Council (GCC), which comprises Persian Gulf nations, also condemned the alleged plot as a flagrant violation of international laws and agreements.

According to Saudi state media, GCC secretary general Abdulattif al-Zayani said it was severely harmful to relations between GCC member states and Iran.”

James Reynolds, BBC’s Iran correspondent, wrote that the assassination plot is both puzzling and bizarre.

“The sanctions on Mahan Air are the most noticeable step the U.S. has taken following its announcement of an Iranian plot to carry out a bomb attack in Washington DC,” he wrote. “Iran insists that the charges are part of an American propaganda campaign. To many observers, the details of the proposed attack by a branch of Iran's Revolutionary Guard remain fairly puzzling. It is not immediately clear why the force would choose Manssor Arbabsiar, a man with a criminal record, as the principal agent of its first ever attack inside the U.S. Nor is it clear why Iran would want to approach a Mexican drugs cartel to plant the bomb - when cartels deliberately avoid hitting targets inside the U.S.”