US Imposes Sanctions on Russia’s VTB Bank Over Iran Ties

The Treasury Department on Monday imposed sanctions on Russia’s VTB Bank Public Joint Stock Company for helping Iran dodge U.S. sanctions, including by establishing correspondent relationships with sanctioned Iranian banks.

The Office of Foreign Assets Control (OFAC) acted under Executive Order 13902, which targets certain sectors of Iran’s economy, including its financial sector. VTB is now among the most comprehensively sanctioned banks on earth, according to the Treasury.

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

VTB, one of Russia’s largest financial institutions, opened offices in Iran in recent years to lock in closer banking coordination and expand two-way trade. Over the past three years, it set up correspondent relationships with sanctioned Iranian banks. In January 2025, it started taking steps to grow its presence in Tehran.

The bank also moved to shift billions of dollars in frozen Iranian assets and built a settlement system using correspondent accounts in Iranian rials and Russian rubles.

VTB had already been sanctioned twice by OFAC: on Jan. 15, 2025, under Executive Order 13662 for operating in Russia’s financial-services sector, and on Feb. 24, 2022, under Executive Order 14024 for being owned or controlled by the Russian government and operating in that same sector.

Operation Economic Outcast was announced Aug. 24 by Bessent and dubbed “Economic D-Day.”

The Treasury said it had mapped the networks Iran uses to smuggle oil, evade sanctions, and fund terror. The department is working with the European Union, the United Kingdom, Gulf partners, and others to choke remaining revenue streams.

Foreign financial institutions that keep dealing with VTB after this Iran-related designation face even higher secondary-sanctions risk than before and should cut those ties immediately, Treasury warned.

All property and interests in property of the designated bank that are in the United States or in the possession of U.S. persons are blocked and must be reported to OFAC. Entities owned 50 percent or more by blocked persons are blocked as well. U.S. persons generally may not transact with blocked property unless OFAC authorizes it or an exemption applies.

Violations can result in civil or criminal penalties. OFAC can impose civil penalties on a strict liability basis. Non-U.S. persons are barred from causing U.S. persons to violate sanctions or from conduct that evades them.

Engaging in certain transactions with VTB may also trigger secondary sanctions on foreign banks.

In late August, Bessent told reporters the United States planned to keep imposing Iran-related measures.

“You’re going to see a lot more of these every week,” he said. “We’re starting with the banks, and we’re telling the banks it’s not okay to have Iranian money and to aid the regime.”