The United States Department of the Treasury has announced economic sanctions on 50 people and firms across Hong Kong, the United Arab Emirates and the Marshall Islands that it claims have been acting as a “sprawling shadow banking network” for Iran’s military.

On Tuesday, the Treasury’s Office of Foreign Assets Control said the entities and individuals are involved in the sale of Iranian oil and petrochemicals, which have helped Iran’s military and government gain illicit access to the international financial system.

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The income pays for weapons and funding to proxy groups, including Yemen’s Houthis, as well as drone transfers to Russia, the Treasury said.

Iran is accused of supplying Russia with drones that are used to bomb Ukrainian civilians as the Kremlin continues its invasion of Ukraine.

Included in the sanctions are Seyyed Mohammad Mosanna’i Najibi, an Iranian-Turkish money-changer, 27 cover companies controlled by Najibi based in Hong Kong, the United Arab Emirates and the Marshall Islands, and a Tehran-based currency exchange business, among others.

An AP inquiry through the Iranian branch of Najibi’s company, known as Sadaf Exchange, was not immediately answered.

Among other measures, the sanctions deny the people and firms access to any property or financial assets held in the US and prevent US companies and citizens from doing business with them.

Treasury Deputy Secretary Wally Adeyemo said the US “will continue to pursue those who seek to finance Iran’s destabilising terrorist activities. We continue to work with allies and partners, as well as the global financial industry, to increase vigilance against the movement of funds supporting terrorism.”

The US has already sanctioned what it claims are Iranian shadow banking businesses. In March 2023, the US imposed economic sanctions on 39 firms it said were linked to a shadow banking system that helped to obfuscate financial activity between sanctioned Iranian firms and their foreign buyers, namely for petrochemicals produced in Iran.