US warns foreign financial institutions not to do business with Iran

The US on Monday warned foreign financial institutions that if they conducted any business with Iran or its banking sector they could be sanctioned by Washington.

“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,” the US Treasury said in an “alert” statement.

The United States launched its war against Iran in late February, killing the country’s leadership and demanding it cease any nuclear-related activities.

The war has plunged the Middle East into violence, with Tehran’s retaliatory action targeting Washington’s Gulf allies and sending global energy and fertiliser prices skyrocketing after it virtually shut a key trading route.

Since late August, Washington has stepped up its campaign to economically isolate Tehran, warning its allies that they would be hit by secondary sanctions if they continued to conduct transactions with the country’s government.

The US Treasury has also announced a slew of new sanctions as part of that push, targeting Iran’s financial, crypocurrency, rail, automotive and manufacturing sectors.

It has also taken action against two banks – one in the United Arab Emirates and another in Turkey – over their alleged aid to the authorities in Tehran.

In Monday’s statement, the Treasury said Iran’s government operated so-called “shadow banking” channels to circumvent US sanctions, and that foreign financial institutions should aim to identify and avoid any such activities.