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US sanctions 39 entities over alleged ‘shadow banking’ for Iran

The US Treasury Department says 39 entities have granted Iran access to the international financial system.

The United States has imposed sanctions on 39 entities, including many based in the United Arab Emirates and Hong Kong, which Washington says 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 said in a statement Thursday that those targeted by the sanctions include companies previously hit with Iran-related sanctions, such as Persian Gulf Petrochemical Industry Commercial Co (PGPICC) and Triliance Petrochemical Co Ltd, gaining access to the international financial system provided. and helped them hide their trade with foreign customers.

The latest US action against Iran comes after efforts to revive the 2015 nuclear deal have stalled, while ties between the Islamic Republic and the West are increasingly strained as Iranians overthrow protests against the continue government.

Washington has targeted Chinese companies for exports of Iran’s petrochemicals as prospects of a nuclear pact revival have faded.

“Iran is cultivating complex sanctions avoidance networks, where foreign buyers swap homes and dozens of front companies work together to help sanctioned Iranian companies continue their trade,” said Deputy Treasury Secretary Wally Adeyemo.

He said the new measures demonstrate the US’s determination to enforce sanctions and its “ability to disrupt Iran’s foreign financial networks, which it uses to launder money”.

Liu Pengyu, a spokesman for the Chinese embassy in Washington, D.C., said the US actions had no basis in international law and were “typical unilateral sanctions and illegal ‘long-arm jurisdiction'” that harmed Chinese interests.

“We regret and reject this move,” he said, adding that China has “actively promoted peace talks and sought a political solution” in Ukraine, while the US has “fanned the fire and fueled the fight with more weapons.”

The Iranian mission to the United Nations in New York did not immediately respond to a request for comment.

Thursday’s action freezes all US assets of those designated and generally prohibits Americans from associating with them. Those who enter into certain transactions with them also risk being hit by sanctions.

Many of the entities designated Thursday are based in the UAE and Hong Kong, according to the Ministry of Finance’s website. The Treasury Department 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 Finance Ministry’s top sanctions officer, Brian Nelson, traveled to the UAE earlier this year, where he planned to warn officials about “poor compliance with sanctions,” a ministry spokesman said at the time.

Nelson also visited Turkey during the trip to warn that Washington will continue to aggressively enforce its sanctions.

Among those designated on Thursday were two Turkey-based entities and the 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 oil moving and get paid for it.

“This is a pretty big deal because things like this should have an impact on what Iran can sell,” O’Toole said.