OFAC Alert: Notice to Foreign Financial Institutions Conducting Business with Iran

OFAC ALERT
Notice to Foreign Financial Institutions
Conducting Business with Iran
October 5, 2026
The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) is alerting foreign financial institutions that continue to do business with Iran or its financial sector that they may be sanctioned under “Operation Economic Outcast.” Foreign financial institutions continuing to transact with sanctioned Iranian financial institutions could be targeted at any time without advance notification and should take immediate action to terminate such activity and relationships. On August 24, 2026, Secretary Bessent announced Treasury’s implementation of “Operation Economic Outcast.” As part of these efforts, Treasury expanded secondary sanctions risk under Executive Order 13902, “Imposing Sanctions with Respect to Additional Sectors of Iran” (E.O. 13902), for individuals and entities supporting the Iranian digital assets, technology, gold, aviation, and shipping sectors. On August 28, 2026, Treasury took action to sever U.S. correspondent banking access for Banque Misr UAE, a critical node for the Iranian regime’s access to U.S. dollars. On September 4, 2026, Treasury designated Türkiye-based Golden Global Bank and its subsidiaries for having facilitated tens of millions of dollars’ worth of transactions for the Islamic Revolutionary Guard Corps-Qods Force and providing the Iranian regime with key correspondent banking access that allowed it to move its funds internationally. On September 14, 2026, Treasury designated VTB Bank Public Joint Stock Company for its involvement in Iranian sanctions evasion activity, including establishing correspondent relationships with sanctioned Iranian banks. Foreign financial institutions facilitating Iran’s access to the global financial system, including by providing financial services to Iranian banks or their subsidiaries or branches in third countries, risk being sanctioned for operating in or supporting sanctioned sectors of Iran’s economy. Foreign financial institutions could also be subject to civil and criminal enforcement penalties should Iran-related transactions cause U.S. financial institutions or other U.S. persons to violate sanctions.

OFAC ALERT - OCTOBER 2026
Shadow Banking Sanctions Risk
Iran depends on networks of trusted parties and front and shell companies to circumvent sanctions and maintain access to the international financial system. These “shadow banking” networks launder funds, primarily from the sale of Iranian oil and other commodities, to try to obfuscate the connection to Iran. Foreign financial institutions potentially exposed to Iranian shadow banking activity should take steps, if they have not done so already, to detect and disrupt this activity to minimize their expo￾sure to sanctions evasion. Such steps should account for Iranian shadow banking typologies previously identified by Treasury and incorporate, on a risk basis, recommended mitigation measures included in the following guidance:

• Financial Crimes Enforcement Network (FinCEN) Alert on the Use of Front Companies, Financial
  Facilitators, and Digital Asset Infrastructure by Iran’s Islamic Revolutionary Guard Corps to Evade Sanctions and Launder Proceeds (May 11, 2026)
• FinCEN Financial Trend Analysis, Iranian Shadow Banking: Trends in Bank Secrecy Act Data
  (October 2025)
• FinCEN Advisory on the Iranian Regime’s Illicit Oil Smuggling Activities, Shadow Banking Networks,
  and Weapons Procurement Efforts (June 6, 2025) OFAC Compliance Hotline ofac.treasury.gov/ofac-compliance-hotline