Billions in Iranian Funds Continue to Flow Through US Banks

Despite extensive American sanctions aimed at cutting Iran off from global finance, billions of dollars linked to Tehran continue to pass through the US banking system each year, according to an investigation by the Wall Street Journal.

Approximately $9 billion of Iranian funds passed through US accounts in 2024 via correspondent banking, a long-established system that allows banks in different countries to settle transactions and access the US dollar network. The report says that Iranian entities are able to reach the system indirectly through foreign companies and financial institutions that maintain relationships with US banks.

The investigation found that Iranian funds can be routed through intermediaries and front companies, making it difficult for banks to establish the ultimate source or destination of transactions.

Meanwhile, US authorities are stepping up pressure on foreign financial institutions suspected of helping Tehran circumvent sanctions. A recent Treasury investigation identified the UAE branch of Egypt’s Banque Misr as having facilitated $1.8 billion in transactions for Iranian shadow networks, according to the Journal.

The continued flow of funds illustrates a broader challenge for sanctions enforcement. US banks are required to monitor transactions passing through their correspondent accounts, but the complexity of international payment chains can make suspicious activity difficult to identify.

To counter this, the Trump administration has launched “Operation Economic Outcast” to target foreign institutions and companies helping Iran maintain access to international finance. At the same time, some officials are concerned that aggressive restrictions on dollar-based transactions could disrupt legitimate cross-border payments and weaken the global financial system that gives the US its influence.