US Sanctions Iranian Shadow Banking Network Supporting IRGC and Weapons Programs
According to the Treasury, the sanctioned network coordinated illicit funds transfers, including proceeds from Iranian oil sales, to sustain Tehran’s shadow banking operations.
ERBIL (Kurdistan24) – The US Department of the Treasury announced on Tuesday that its Office of Foreign Assets Control (OFAC) has designated two Iranian financial facilitators along with more than a dozen individuals and entities based in Hong Kong and the United Arab Emirates (UAE) for their role in financing Iran’s Islamic Revolutionary Guard Corps-Qods Force (IRGC-QF) and the Ministry of Defense and Armed Forces Logistics (MODAFL).
According to the Treasury, the sanctioned network coordinated illicit funds transfers, including proceeds from Iranian oil sales, to sustain Tehran’s shadow banking operations. These networks, often operated through front companies and cryptocurrency schemes, are accused of laundering money to bypass international sanctions.
The funds, US officials said, are used by the IRGC-QF and MODAFL to arm regional proxy groups and develop advanced weapon systems, including ballistic missiles and drones, that threaten US forces and allies in the Middle East.
“Iranian entities rely on shadow banking networks to evade sanctions and move millions through the international financial system,” Under Secretary of the Treasury for Terrorism and Financial Intelligence John K. Hurley stated. “Under President Trump’s leadership, we will continue to disrupt these key financial streams that fund Iran’s weapons programs and malign activities in the Middle East and beyond.”
The designations were issued under Executive Order 13224, which targets terrorists and those providing support to terrorism. This marks the second round of sanctions against Iran’s shadow banking infrastructure since the administration issued National Security Presidential Memorandum 2, directing a maximum pressure campaign on Tehran.
The IRGC-QF has long been accused of supporting groups such as Hezbollah and militias in Iraq, Syria, and Yemen. Its parent organization, the IRGC, was sanctioned in 2017 for providing material and financial backing to the Qods Force. MODAFL, meanwhile, was blacklisted in 2019 for its role in supplying financial and technological assistance to the IRGC-QF.
Tuesday’s measures follow previous Treasury actions this year. On July 9, OFAC sanctioned a similar shadow banking network tied to oil proceeds that were being moved on behalf of the IRGC-QF. Earlier, on June 6, another major network connected to the Iranian Zarginhalam brothers was targeted for laundering billions through front companies and exchange houses for sanctioned Iranian entities.
Washington says these sanctions are part of its broader campaign to choke off Iran’s access to global financial systems and curb its ability to fund militant proxies and weapons development.
