- The US Treasury sanctioned nearly 50 entities tied to an Iranian shadow-banking network.
- The Treasury says these firms conceal revenue used by Iran's military to support Houthi and Russian operations.
- The funds allow Iran to produce drones used by Russia against Ukraine, a Tuesday release said.
Iran's "sprawling" shadow-banking network has fallen into the crosshairs of the US Treasury Department, which sanctioned close to 50 entities and individuals tied to these lenders.
In a Tuesday announcement, the department described a web of exchange houses and foreign cover companies that are concealing revenue gained by Iran's military, as well as the Islamic Revolutionary Guard Corps.
The Treasury says these funds, equalling billions of dollars since 2020, are helping procure and develop advance weapon systems, such as unmanned aerial vehicles.
The hidden revenue is also used to support the actions of the Houthi rebels, a Yemeni group behind the Red Sea attacks on commercial vessels, the release said. Meanwhile, the Treasury says the produced drone weaponry is making its way to Russia, boosting battlefield efforts against Ukraine.
Backing this income is the illegal sale of Iranian oil and petrochemicals, according to the announcement. Sanctioned targets reportedly include firms helping launder the revenue generated from this activity, and involve companies in Hong Kong, the United Arab Emirates, and the Marshall Islands.
"The United States is taking action against a vast shadow banking system used by Iran's military to launder billions of dollars of oil proceeds and other illicit revenue," Deputy Secretary Wally Adeyemo said in the report. "We have sanctioned hundreds of targets involved in Iran's illicit oil and petrochemical-related activity since President Biden took office, and we will continue to pursue those who seek to finance Iran's destabilizing terrorist activities."
Iran has previously been accused of fueling Russia's war effort with drone sales, and the Kremlin has increasingly become reliant on its technology.
While Western sanctions have tried to hamper Moscow's own production, Iran has sourced needed manufacturing parts from Asian suppliers, bypassing restrictions placed on the country.
The Treasury's new measures come just weeks after it announced a separate slew of wide-sweeping sanctions on Russia-friendly financial institutions, in an effort to slash any remaining financial lifelines keeping Moscow afloat.
But while the restrictions will definitely create economic pains for the country, think tank expert Alexandra Prokopenko has warned the move is too late to make a major difference.
