U.S. Treasury targets Iranian crypto exchanges in sanctions crackdown

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US Treasury targets Iranian crypto

Highlights

Treasury's OFAC designated Iran-linked digital asset exchanges, including Shelbit Exchange and Aban Tether, citing sanctions evasion and laundering linked to the IRGC.
Shelbit Exchange allegedly received more than $1 million and sent over $2 million in digital assets to IRGC-linked wallets, also servicing online gambling networks laundering tens of millions of dollars.
The sanctions block all designated property in U.S. jurisdiction, expose financial institutions to penalties, and align with a $15 million State Department reward for information disrupting IRGC financial networks.

Sanctions action targets exchanges and front companies

As reported by U.S. Department of the Treasury, the Office of Foreign Assets Control is designating Iran-linked digital asset exchanges and associated entities that it says support sanctions evasion, covert financial access and cryptocurrency laundering. Treasury says the action is developed with the Internal Revenue Service-Criminal Investigation and forms part of its broader maximum economic pressure campaign on Iran under National Security Presidential Memorandum 2.

Treasury identifies Siavash Kayvanpour as the operator of a multinational company network tied to illicit digital currency activity. Through Georgia-based SHPS Shelbit, he operates Shelbit Exchange, which Treasury says receives more than $1 million in digital assets from IRGC-linked addresses and sends more than $2 million back to IRGC-linked wallets; addresses linked to Kayvanpour also send more than $2 million in digital assets to previously designated exchange Nobitex.

The department also says Shelbit services a Persian-language online gambling network whose digital assets are allegedly laundered through the platform in the tens of millions of dollars. Treasury is also designating UAE-based Shelbit General Trading LLC, Poland-based Shelbit Technologies Ltd, UAE-based Crypto Home DMCC and UAE-based NFT Home DMCC, saying they are owned, controlled or directed by, or act on behalf of, Kayvanpour or Shelbit.

Separately, Treasury says Iran-based Aban Tether processes millions of dollars in transactions involving previously designated Iranian exchanges including Nobitex, Wallex, Bitpin and Ramzinex. OFAC is designating Aban Tether under Executive Order 13902 for operating in the financial sector of the Iranian economy.

Compliance risks widen for financial institutions

Under the action, all property and interests in property of the designated persons that are in the United States or in the possession or control of U.S. persons are blocked and must be reported to OFAC. Entities owned 50% or more, directly or indirectly, by one or more blocked persons are also blocked unless exempt or authorized.

Treasury says U.S. persons are generally prohibited from engaging in transactions involving blocked property, and violations can bring civil or criminal penalties for both U.S. and foreign persons. It also warns that financial institutions and other parties may face sanctions exposure for transactions involving designated persons, including providing or receiving funds, goods or services, or causing U.S. sanctions violations.

The action also intersects with broader enforcement efforts. The State Department's Rewards for Justice program is offering up to $15 million for information that disrupts the financial mechanisms of the IRGC and its branches, while Treasury points to sanctions-risk guidance on Iranian digital asset exchanges and says whistleblowers may qualify for awards if their information leads to enforcement penalties above $1 million.

Our earlier article on the Enforcement Directorate’s money laundering case involving Deepak Cable (India) Ltd. detailed how investigators alleged bank-loan misappropriation, fund diversion, and fake transactions routed through associated entities. We noted that the probe included a prosecution complaint, the arrest of a key executive, and the provisional attachment of roughly ₹51.28 crore in immovable assets under the PMLA as the investigation continued.

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