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The United States has announced new sanctions targeting an international financial network accused of facilitating illicit oil sales and cryptocurrency transactions that fund Iran’s military and terrorist proxy groups.

Getting into it: The sanctions, unveiled by the Treasury Department, target over a dozen individuals and entities based primarily in Hong Kong and the United Arab Emirates. These actors are accused of helping the Iranian government move hundreds of millions of dollars in proceeds from oil sales through an elaborate “shadow banking” network. This network relied on front companies, shell entities, and cryptocurrency wallets to disguise the origin and destination of the funds. At the center of the operation are two Iranian nationals (Alireza Derakhshan and Arash Estaki Alivand) who allegedly coordinated the transfer of more than $100 million in cryptocurrency from oil sales on behalf of Iran’s Islamic Revolutionary Guard Corps-Quds Force (IRGC-QF) and the Ministry of Defense and Armed Forces Logistics (MODAFL).

According to US officials, the scheme involved creating layers of fake companies and offshore accounts that masked the Iranian government’s involvement. For example, Derakhshan and Alivand used a network of front companies such as Alpa Trading – FZCO, Minato Commercial Brokers, and Everest Investment LLC to handle transactions linked to sanctioned military programs. These entities would receive payments from international buyers of Iranian oil, then transfer the funds through a series of intermediary firms to eventually fund the IRGC-QF and MODAFL.

OFAC stated that these financial streams directly support Iran’s ballistic missile development, drone programs, and terrorist proxies across the Middle East.

In a statement, Under Secretary of the Treasury for Terrorism and Financial Intelligence John K. Hurley said, “Iranian entities rely on shadow banking networks to evade sanctions and move millions through the international financial system. 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.”