The US Treasury Department stated, “In its largest ever single-day action targeting the Iranian regime, the US Department of the Treasury’s Office of Foreign Assets Control (OFAC) sanctioned more than 700 individuals, entities, aircraft, and vessels.”
Treasury Undersecretary Sigal Mandelker stated, “As the Iranian people suffer from fiscal mismanagement and a plummeting rial, the Iranian regime abuses the country’s banking system to enrich its elite and finance repressive state institutions.
The Islamic Revolutionary Guard Corps – Qods Force and other destabilizing entities leverage their access to the global financial system to fund proxies fighting in Syria, Iraq, and Yemen, subsidize the proliferation of WMD or their means of delivery, and arm those who abuse the human rights of Iranian citizens.
This action is aimed at cutting off Iranian banks that facilitate Iran’s domestic repression and foreign adventurism from the international financial system, and will highlight for the world the true nature of the regime’s abuse of its domestic banking system.”
The banking sector was a top priority of the sanctions. Notable among OFAC’s banking designations are The Ghadir Investment Company and Bank Melli.
Because of its association with the “Execution of Imam Khomeini’s Order” (EIKO), the Ghadir Investment Company and ninety-two of its subsidiary institutions were previously identified by OFAC. EIKO, also known as the Executive Headquarters of Imam’s Directive, is an official, state-managed organization in the Islamic Republic of Iran under direct control of the Supreme Leader of Iran.
It was created by Supreme Leader Ruhollah Khomeini. According to Reuters, EIKO’s holdings include large amounts of real estate and thirty-seven companies, and cover nearly every sector of Iranian industry, including finance, oil, and telecommunications.
Bank Melli is designated for sanctions for assisting in, sponsoring, or providing financial, material, or technological support for, or financial or other services to or in support of, the IRGC-QF and Ministry of Defense and Armed Forces Logistics, according to OFAC.
Bank Melli is the largest Iranian company in terms of annual income, and is generally considered the first national and commercial retail bank of Iran. Bank Melli is the largest bank in the Middle East. BMI has thousands of branches inside Iran and fourteen active branches abroad.
Bank Melli was designated because of its link to Iran’s financial support for international terrorism. According to the Treasury Department, “The Islamic Revolutionary Guard Corps (IRGC) has used Bank Melli to dispense funds to Iraqi Shia militant groups and Bank Melli’s presence in Iraq was part of this scheme.
Since the mid-2000s, Bank Melli increasingly provided services to Iranian military-related entities as they became further involved in all aspects of the Iranian economy. Bank Melli has enabled the IRGC and its affiliates to move funds inside and outside of Iran.”
Bank Melli is allegedly involved in funding the domestic crackdown inside Iran, and IRGC activities outside of Iran. IRGC activities facilitated by Bank Melli are said to include oil and drug smuggling, extortion, arms sales and an assortment of other profitable terrorist activities.
OFAC’s actions are designed to:
1) disrupt the Iranian regime’s ability to fund its broad range of malign activities;
2) place pressure the Iranian regime to negotiate a deal that will permanently prevent Iran from acquiring a nuclear weapon and cease Iran’s development of ballistic missiles.