US sanctions VTB Bank over alleged Iranian banking ties 

The US Treasury has placed Russia’s VTB Bank under fresh sanctions, citing its role in helping Iran bypass existing restrictions, including through correspondent banking ties with Iranian lenders already under sanctions. 

The measure was imposed by the Treasury’s Office of Foreign Assets Control under Executive Order 13902, which applies to sectors of Iran’s economy including finance.  

“VTB is now among the most comprehensively sanctioned financial institutions in the world,” said the Treasury. 

It noted the move forms part of Operation Economic Outcast, an enforcement effort announced by Secretary Bessent in August 2026. 

According to the department, the programme increases the sanctions risk for foreign institutions that continue dealings linked to Iran. 

It said foreign financial institutions that maintained business with VTB after its designation under Iran-related sanctions face heightened exposure and “should cut off those relationships immediately”. 

The department added any company involved in money laundering or sanctions avoidance for Iran could lose access to the US financial system. 

VTB, one of Russia’s biggest banks, has in recent years opened offices in Iran as part of broader banking co-ordination with Tehran and to support trade between the two countries.  

Over the past three years, it established correspondent banking arrangements with sanctioned Iranian financial institutions and in January 2025 began expanding its presence in Tehran, highlighted the department. 

It said the bank took steps to transfer billions in frozen Iranian assets and set up a settlement mechanism in national currencies through correspondent accounts in Iranian rials and Russian roubles to support bilateral trade. 

Under the action, any property or interests in property of the designated person that are in the US or held or controlled by US persons are blocked and must be reported to OFAC. 

The  

Treasury said breaches of US sanctions can lead to civil or criminal penalties for both US and non-US persons, and that OFAC can issue civil penalties on a strict liability basis. 

The restrictions also cover the provision or receipt of funds, goods or services by, to or for the benefit of a designated or blocked person. 

Non-US persons are barred from causing, or conspiring to cause, US persons to violate sanctions, whether knowingly or otherwise, and from taking part in conduct designed to evade those measures. 

The department said certain transactions involving the newly designated party could expose participating foreign financial institutions to secondary sanctions. 

Secretary of the Treasury Scott Bessent said: “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 will not tolerate any support to the regime and will continue to identify, expose, and isolate Iran’s enablers.”