WASHINGTON — Treasury Secretary Scott Bessent on Friday warned that the United States could move to sever $1.8 billion in alleged Iranian shadow-banking activity routed through the United Arab Emirates, escalating Washington’s Operation Economic Outcast campaign.
The Treasury Department’s action focuses on Banque Misr UAE, which officials say handled roughly $1.8 billion from January 2024 through June 2026 for 103 companies suspected of being tied to Iranian shadow finance networks.
In a proposed rule issued Friday, Treasury named five UAE-based branches of the bank as a “Financial Institution Operating Outside of the United States of Primary Money Laundering Concern.” The designation gives the department a 30-day window to potentially cut the branches off from the U.S. financial system.
The branches are part of Banque Misr, Egypt’s second-largest bank. According to Treasury, some of the bank’s customers include companies accused of acting as fronts for Iran’s Ministry of Defense and the Islamic Revolutionary Guard Corps, helping Tehran evade U.S. sanctions and launder money on behalf of Iranian Supreme Leader Mojtaba Khamenei.
Treasury’s Financial Crimes Enforcement Network, known as FinCEN, has previously flagged as much as $9 billion in transactions linked to potential Iranian shadow-banking activity that moved through U.S. financial institutions in 2024 alone.
“Treasury promised to sever every economic lifeline Tehran has left and finally end the threat of the Iranian regime,” Bessent said in a statement.
“We also warned that Iran’s enablers cannot continue to enjoy access to the U.S. dollar and the global financial system. Banque Misr UAE decided to find out the hard way, and today, we are taking the first step in holding it accountable for its continued, egregious support of the Iranian regime,” he added.
The move underscores how the United States is broadening its confrontation with Iran beyond military and diplomatic pressure, aiming instead at the financial channels that Washington says help keep Tehran’s sanctioned economy functioning.
The Treasury Department is working to revoke the UAE-based bank’s access to US financial institutions, using a section of the Patriot Act that gives the government the power to target foreign banks, countries, or accounts that pose high money laundering risks related to terrorism.
A final rule from the Treasury penalizing the bank could be published in the Federal Register within 30 days, which would mark the end of the public comment period, though final discretion is left up to the department.
Banque Misr UAE “serves as a critical access node to the U.S. dollar (USD) for Iranian illicit finance, putting U.S. national security at risk and undermining the integrity of the U.S. financial system,” Treasury charged.
Iran is already subject to US sanctions so it uses “shadow” banks to launder funds, procure weapons, and bankroll its regional terrorist proxy groups.
Treasury also blacklisted Iranian national Reza Mohammad Taeedi, the general manager of the Dubai branch of Iran’s Bank Melli.
And it sanctioned a Hong Kong entity, Kameng Trading Limited, for allegedly acting as a front company that launders money for an Iranian exchange house.
With the war at the six month mark and no peace deal in sight, the U.S. is going after Iran’s money to try and pressure them into a ceasefire.
As part of Operation Economic Outcast, which Bessent announced Monday, the Treasury mapped the networks Iran uses to smuggle oil, evade sanctions, and fund terror. The department is then targeting any source of the regime’s illicit revenue.
The administration calls it “Economic D-Day.”
