The U.S. Treasury Department Imposes Sanctions on Iranian 'Shadow Banks' Network

The U.S. Treasury Department imposed a new package of sanctions today, Tuesday, targeting Iranian financial intermediaries and more than ten individuals and entities, due to their alleged role in facilitating financial transfers from oil revenues for the benefit of the Quds Force of the Iranian Revolutionary Guard and the Iranian Ministry of Defense.

A statement published on the department's website indicated that the targeted networks operate as 'shadow banks' to evade sanctions imposed on Iran, relying on front companies and dealing in cryptocurrencies. The statement clarified that the financial revenues generated by these networks 'are used to support armed groups and develop advanced weapons, including missiles and drones'.

For his part, the Treasury Undersecretary for Terrorism and Financial Intelligence, John K. Hurley, commented on the decision, saying: 'Iranian entities rely on shadow banking networks to evade sanctions and move millions of dollars through the international financial system. Under President Trump's leadership, we will continue to disrupt these financial flows that fund Iran's military programs and its malign activities in the Middle East and beyond.'

The Treasury noted that these measures come under the amended Executive Order (13224), representing the second round of sanctions on the structure of Iranian 'shadow banks' since the issuance of Presidential National Security Memorandum No. 2, which directed a 'maximum pressure' campaign against Tehran.

Under the decision, all properties and interests belonging to the targeted individuals and entities within the United States or under the control of U.S. persons will be frozen, and Americans are prohibited from conducting any financial or commercial transactions with them.

The repercussions are not limited to the entities directly listed, as the Treasury warned that foreign financial institutions could face secondary sanctions if they engage in significant transactions with these entities. The Office of Foreign Assets Control (OFAC) confirmed that 'the ultimate goal of the sanctions is not punishment per se, but to compel the targeted entities to change their behavior.'

These sanctions are part of a series of ongoing measures targeting the infrastructure of Iranian parallel financing. This comes in implementation of the directives of Presidential National Security Memorandum No. 2 issued by President Donald Trump.

It is noted that in recent months, the Office of Foreign Assets Control has listed more than 30 individuals and entities linked to Iran, accusing them of 'laundering billions of dollars through the international financial system via Iranian exchange offices and foreign companies operating as fronts under their control.'