U.S. blacklists Russia’s VTB Bank for aiding Iran in evading sanctions
Sept. 14 (UPI) — The United States has blacklisted VTB Bank, Russia’s second-largest lender and the only Russian bank with a branch in China, alleging its involvement in Iranian sanctions evasion, as the Trump administration seeks to further isolate Tehran amid their monthslong war.
The Treasury designated VTB on Monday under Iran sanctions authorities, adding to the sanctions risks foreign financial institutions face for continued business dealings with the lender.
According to Treasury officials, VTB is accused of opening bank offices in Iran to foster closer cooperation with the Iranian regime and expand trade between their countries. Over the last three years, the Russian bank has created relationships with sanctioned Iranian financial institutions and is alleged by the Trump administration to have taken steps to move billions of dollars in frozen Iranian assets, among other actions.
“The United States remains steadfast in cutting off the financial lifelines that allow the Iranian regime to fund terrorism, destabilize the region and threaten U.S. economic security,” State Department spokesman Thomas Pigott said in a statement.
“Today’s action sends a clear message to governments and financial institutions considering similar arrangements: any effort to help Iran evade sanctions will carry serious consequences, including exposure to U.S. financial restrictions.”
VTB is already heavily sanctioned and has been under full U.S. blocking sanctions since February 2022, when the Treasury targeted the bank following Russia’s invasion of Ukraine. Monday’s designation adds Iran-related sanctions authorities, increasing the potential for sanctions exposure of foreign banks that continue to do business with VTB.
Miad Maleki, a senior fellow at the Washington-based Foundation for Defense of Democracies and a former Treasury sanctions official, emphasized that the sanctions could be particularly consequential for China, where Chinese financial institutions linked to VTB could face additional secondary-sanctions risk.
“Beijing has shielded its big banks from the Russia fight. Shielding them from the Iran fight is a different calculation, days before Xi meets Trump,” Maleki said online.
President Donald Trump and Chinese leader Xi Jinping are set to meet on Sept. 24 at the White House.
The sanctions were imposed amid a stalemate in the U.S.-Iran war with no end in sight.
Trump has sanctioned Iran for years now, going back to its first administration, and has repeatedly tightened his financial vices on Tehran amid the war, which began Feb. 28 with joint strikes on Iran by the United States and Israel.
Trump has for years sought to coerce Iran to the negotiating table on a new deal aimed at preventing it from securing a nuclear weapon since 2018, when he unilaterally pulled the United States from such an agreement that he criticized for being defective at its core.
The sanctions announced Monday were part of Operation Economic Outcast, which was launched in late August to financially isolate Iran by cutting it off from economic and financial networks that sustain the regime.
“Under Operation Economic Outcast, Treasury will continue to target and disrupt those who provide material, technological or financial support that allows the Iranian regime to sustain its terrorist enterprise,” Treasury Secretary Scott Bessent said in a statement.
“Treasury will not tolerate any support to the regime and will continue to identify, expose and isolate Iran’s enablers.”