Bessent Targets Banks In Uae Over Iran Ties

The Trump administration is moving to cut off bank branches located in the United Arab Emirates from the U.S. financial system, the first public action under Treasury Secretary Scott Bessent’s new campaign to squeeze Iran by targeting its trading and financial partners abroad.

The Treasury Department said Friday it would propose a rule prohibiting U.S. banks from facilitating transactions involving the UAE-based branches of Banque Misr, which is one of Egypt’s largest banks.

“Iran’s enablers cannot continue to enjoy access to the U.S. dollar and the global financial system,” Bessent said in a statement. “Banque Misr UAE decided to find out the hard way, and today, we are taking the first step in holding it accountable for its continued, egregious support of the Iranian regime.”

The move follows Bessent’s announcement earlier this week of a new pressure campaign, dubbed Operation Economic Outcast, aimed at forcing foreign governments, banks and companies to sever their economic ties with Tehran. Bessent had previewed that Treasury would take action against a foreign financial institution by the end of the week.

Treasury accused Banque Misr's UAE operations of serving as “a significant conduit for Iranian shadow banking,” allowing Iranian entities access to U.S. dollars despite sweeping U.S. sanctions against the country. Treasury said it had identified 103 potential front companies that transacted $1.8 billion through Banque Misr UAE accounts from January 2024 to June 2026.

Bessent is invoking powers under Section 311 of the USA PATRIOT Act that allow the Treasury secretary to take action against foreign banks that present a “primary money-laundering concern” to the U.S. The agency will accept comments for 30 days on the proposed rule targeting Banque Misr UAE before it takes effect.

Separately, Treasury said it was sanctioning the general manager of the Dubai branch of Bank Melli, Iran's largest lender, as well as a Hong Kong-based front company it said was helping to launder funds to Iran.

The action against UAE-based banks comes after the Emirati government announced earlier this month that it was suspending all trade with Iran. Bessent hinted earlier this week that the decision was the result of U.S. pressure.

But Bessent and Trump administration officials have so far sidestepped questions about the extent to which they will apply the same pressure on China, Iran’s largest trading partner and a major buyer of its oil.

Treasury has already sanctioned some Chinese entities, “teapot” oil refineries and other relatively small companies over Iran ties.

But targeting large Chinese financial institutions would carry far greater risks, potentially sending ripples through the global financial system and antagonizing Beijing as President Donald Trump prepares for expected talks with Chinese President Xi Jinping.

“We are giving everyone the opportunity to remedy bad behavior,” Bessent said earlier this week. “Why would I want to blow up the global financial system?”

Trump suggested Thursday that action against Chinese banks remained on the table. Asked why he was not sanctioning Chinese banks, Trump said, “who said I’m not?”

“You don’t know if I’m doing it,” he told reporters. “Well, I don’t have to announce everything, do I?”

Bessent will have another opportunity to press the administration’s latest effort to squeeze Iran’s economy next week, when he hosts finance ministers from around the world for a G20 gathering in Asheville, North Carolina.

A Treasury official said Bessent plans to use one-on-one meetings on the sidelines of the gathering to push his counterparts to curtail their countries’ financial ties with Iran.

“I expect that this will come up in every single bilateral meeting that the secretary is hosting with our G20 counterparties over the coming days,” the official told reporters Thursday. “This is a critical aspect right now of our economic campaign against Iran, and so we want to ensure that there's consistency across all of the G20 members.”