President Barack Obama today named Levey's current deputy and former law partner, David Cohen, the assistant Treasury secretary for terrorist financing, to succeed Levey as undersecretary for terrorism and financial intelligence.
Levey was the first to hold the post when it was created by the Bush administration in 2004. And in 2009, Obama asked Levey to stay on as leader of the government's efforts to cut off financial support to international terrorists, drug traffickers, proliferators of weapons of mass destruction and other national security threats.
"It will have no effect on policy or on our ability to execute the president's policy," Geithner said, citing Cohen's close work with Levey.
But the news of Levey's departure comes just two days after the latest top-level diplomacy over Iran's nuclear program ended without any negotiation having even taken place.
Iran declined to engage any of the parties across the table -- the U.S., Britain, France, Germany, Russia and China -- insisting it has the right to enrich uranium, an activity much of the international community suspects to be a part of an Iranian drive to build atomic weaponry.
That means the Obama administration is likely to return to its strategy of tightening pressure on a financially beleaguered Iran, in hope that the cost of pursuing suspect nuclear activities will prove too much for the governing mullahs.
After a previous round of negotiations was rejected by Tehran in the fall of 2009, the U.S. cobbled together global support for tougher United Nations sanctions in June, and then piled on a host of additional sanctions on Iran's banks, shipping companies and other commercial and government groups supporting the nuclear program.
Levey has been the leader and principal guide of that effort in Washington, and its chief proponent abroad, frequently traveling to allied capitals to coordinate strategy or persuade reluctant governments to get on board.
A senior Justice Department official from 2001 until he moved to the Treasury, Levey is expected to stay in the post another month as Cohen, who also served as a Treasury lawyer in the Clinton administration, goes through the confirmation process.