U.S. sanctions Cuba's BICSA over Iran-linked financial services

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U.S. sanctions Cuba's BICSA

Highlights

BICSA, Cuba's state-owned bank, has been sanctioned by the U.S. Department of State for providing financial services to Iran's Karafarin Bank since at least 2022.
All property and interests of BICSA under U.S. jurisdiction are now blocked, with restrictions extending to entities 50% or more owned by designated persons.
Foreign financial institutions face heightened sanctions risk if engaging with BICSA or operating in Cuba's financial, energy, defense, metals, or security sectors under Executive Order 14404.

Sanctions action and legal basis

As reported by U.S. Department of State, Cuba's Banco Internacional de Comercio, S.A., known as BICSA, has provided services to Iran's Karafarin Bank since at least 2022. Karafarin Bank was sanctioned by the Department of the Treasury in 2020 under Executive Order 13902, and the State Department says the new action is being taken alongside a Treasury action on Iranian financial actors.

The State Department says it is sanctioning the Cuban state-owned bank under Section 2(a)(i)(A) of Executive Order 14404 for operating in, or having operated in, the financial services sector of the Cuban economy. The order, issued on May 1, 2026, authorizes sanctions tied to repression in Cuba and threats to U.S. national security and foreign policy.

Under the sanctions, all property and interests in property of BICSA that are in the U.S. or in the possession or control of U.S. persons are blocked and must be reported to the Treasury Department's Office of Foreign Assets Control, or OFAC. The restrictions also extend to entities owned 50% or more, individually or in aggregate, by one or more blocked persons.

Compliance risks for banks and counterparties

U.S. persons and others subject to U.S. jurisdiction are prohibited from transactions or dealings involving property or interests of designated or otherwise blocked persons unless authorized or exempt. The prohibition includes providing or receiving funds, goods, or services for the benefit of a blocked person.

The State Department also warns that foreign persons engaging in transactions with parties designated under Executive Order 14404, or operating in sectors such as energy, defense and related materiel, metals and mining, financial services, or security in the Cuban economy, are themselves at risk of sanctions. Non-U.S. persons, including foreign financial institutions, are urged to proceed with caution, particularly in any effort to return assets to a sanctioned party or transfer them to another jurisdiction.

The department says the broader sanctions framework also draws on Executive Order 14380 and National Security Presidential Memorandum 5, which outline the administration's Cuba policy goals. It adds that the sanctions system includes a path for petitions to be removed from the Specially Designated Nationals and Blocked Persons List through OFAC's reconsideration process.

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