US Targets ‘Shadow Banking’ Network Helping Iran Evade Sanctions

A bronze seal for the Department of the Treasury is shown at the US Treasury building in Washington, US, January 20, 2023.  (Reuters)
A bronze seal for the Department of the Treasury is shown at the US Treasury building in Washington, US, January 20, 2023. (Reuters)
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US Targets ‘Shadow Banking’ Network Helping Iran Evade Sanctions

A bronze seal for the Department of the Treasury is shown at the US Treasury building in Washington, US, January 20, 2023.  (Reuters)
A bronze seal for the Department of the Treasury is shown at the US Treasury building in Washington, US, January 20, 2023. (Reuters)

The United States on Thursday imposed sanctions on 39 entities, including many based in Hong Kong, that Washington said facilitate Iran's access to the global financial system, describing them as a "shadow banking" network that moves billions of dollars.

The US Treasury Department in a statement said those targeted had granted companies previously slapped with Iran-related sanctions, such as Persian Gulf Petrochemical Industry Commercial Co (PGPICC) and Triliance Petrochemical Co Ltd, access to the international financial system and helped them hide their trade with foreign customers.

The latest US move against Iran comes as efforts to revive the 2015 nuclear deal have stalled, while ties between Tehran and the West have become increasingly strained as Iranians keep up anti-government protests.

Washington has targeted Chinese companies over the export of Iran's petrochemicals as the prospects of reviving the nuclear pact have dimmed.

"Iran cultivates complex sanctions evasion networks where foreign buyers, exchange houses, and dozens of front companies cooperatively help sanctioned Iranian companies to continue to trade," said Deputy Treasury Secretary Wally Adeyemo.

He said the new measures showed the US commitment to enforcing sanctions and its "ability to disrupt Iran's foreign financial networks, which it uses to launder funds."

Liu Pengyu, spokesman for China's embassy in Washington said the US actions had no basis in international law and were "typical unilateral sanctions and illegal 'long-arm jurisdiction'" that were detrimental to Chinese interests.

"We deplore and reject this move," he said, adding China had "actively promoted peace talks and sought a political solution" in Ukraine, while the United States "has been fanning the flame and fueling the fight with more weaponry."

Iran's mission to the United Nations in New York did not immediately respond to a request for comment.

Thursday's move freezes any US assets of those designated and generally bars Americans from dealing with them. Those that engage in certain transactions with them also risk being hit by sanctions.

The Treasury accused companies operating out of Hong Kong - including Foraben Trading Limited, Hongkong Well International Trading Limited, and Salita Trade Limited - of transferring millions of dollars related to petrochemical sales to China.

The Treasury Department's top sanctions official, Brian Nelson, recently visited Türkiye to warn that Washington will continue to aggressively enforce its sanctions.

Among those designated on Thursday were two Türkiye-based entities, as well as Iran-based Mehr Petrochemical Company.

Brian O'Toole, a former Treasury Department official, said Thursday's action would put a dent in Iran's ability to keep moving oil and get paid for it.

"This is a pretty big deal, because this kind of thing should have an impact on what Iran is able to sell," O'Toole said.



Pakistan Fears Militants Will Thrive on Restive Border if Iran Destabilized

Pakistani security personnel stand guard as pilgrims (back) who evacuated from Iran walk at the Pakistan-Iran border in Taftan on June 16, 2025. (Photo by AFP)
Pakistani security personnel stand guard as pilgrims (back) who evacuated from Iran walk at the Pakistan-Iran border in Taftan on June 16, 2025. (Photo by AFP)
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Pakistan Fears Militants Will Thrive on Restive Border if Iran Destabilized

Pakistani security personnel stand guard as pilgrims (back) who evacuated from Iran walk at the Pakistan-Iran border in Taftan on June 16, 2025. (Photo by AFP)
Pakistani security personnel stand guard as pilgrims (back) who evacuated from Iran walk at the Pakistan-Iran border in Taftan on June 16, 2025. (Photo by AFP)

Separatist and extremist militants on the Pakistan-Iran border could take advantage of any collapse of authority in Iran, fears that Pakistan’s army chief pressed in a meeting this week with the US President Donald Trump. Anti-Iranian and anti-Pakistan outfits operate on both sides of the 560-mile (900km) long border. As Israel bombs Iran's nuclear program, its officials have repeatedly indicated that they are seeking to destabilize the Iranian government or see it toppled.

As well as worrying about chaos spilling over from Iran, Pakistan is concerned about the precedent set by Israel of attacking the nuclear installations of another country. Nuclear-armed rivals Pakistan and India fought a four-day conflict in May, Reuters said.

Following a Wednesday lunch at the White House with Pakistan’s army chief, Field Marshal Asim Munir, Trump said: “They’re not happy about anything”, referring to Pakistan's views on the Israel-Iran conflict. Pakistan’s military said on Thursday that the two had discussed Iran,“with both leaders emphasizing the importance of resolution of the conflict”.

Pakistan has condemned Israel’s attack on Iran as a violation of international law. “This is for us a very serious issue what is happening in our brotherly country of Iran,” Shafqat Ali Khan, spokesman for Pakistan’s Ministry of Foreign Affairs, said on Thursday. “It imperils the entire regional security structures, it impacts us deeply.”

Some of the militant groups on the border have welcomed the upheaval. Jaish al-Adl (JaA), an Iranian militant group which operates from Pakistan, said Israel’s conflict with Iran was a great opportunity.

“Jaish al-Adl extends the hand of brotherhood and friendship to all the people of Iran and calls on all people, especially the people of Baluchistan, as well as the armed forces, to join the ranks of the Resistance,” the group said in a statement on June 13.

Conversely, Pakistan fears that separatist militants from its own Baluch minority, which are based in Iran, will also seek to step up attacks.

"There’s a fear of ungoverned spaces, which would be fertile ground for terrorist groups," said Maleeha Lodhi, a former Pakistani ambassador to Washington.

Pakistan has unstable borders with Taliban-run Afghanistan and arch-rival India. It does not want to add another volatile frontier on its long border with Iran.

The Iran-Pakistan border region is populated with ethnic Baluch, a minority in both countries who have long complained about discrimination and launched separatist movements. On Pakistan’s side, the region is a province called Balochistan and in Iran it is Sistan-Baluchistan.

Until Israel's bombing of Iran, Tehran was closer to Pakistan’s arch-rival India. Pakistan and Iran had even traded air strikes last year, accusing each other of harboring Baluch militants. But the attack on Iran has upended alliances, as India has not condemned Israel's bombing campaign.

China has also said that it is deeply concerned about the security situation in Balochistan, with the area being a focus of Beijing’s multi-billion dollar infrastructure investment program in Pakistan, centered on the new Chinese-run port of Gwadar. Baluch militant groups in Pakistan have previously targeted Chinese personnel and projects.

Simbal Khan, an analyst based in Islamabad, said the different Baluch groups could morph into a “greater Baluchistan” movement which seeks to carve out a new nation from the Baluch areas of Pakistan and Iran.

“They’re all going to fight together if this blows up,” said Khan.