U.S. FinCEN Report: Financial Trend Analysis - Iranian Shadow Banking: Trends in Bank Secrecy Act Data

The U.S. Financial Crimes Enforcement Network (FinCEN) identified roughly $9 billion in suspected Iranian shadow banking activity during 2024, revealing an extensive global network used by Tehran to evade U.S. sanctions, sell oil illicitly, launder proceeds, and fund weapons programs. The report highlights Dubai, Hong Kong, and Singapore as key financial hubs facilitating these operations through front and shell companies that obscure ownership and transactions. Shell companies accounted for $5 billion, oil firms for $4 billion, and shipping firms for $707 million, tied to moving sanctioned Iranian oil. The analysis found significant exploitation of U.S. correspondent banking channels and vulnerabilities within UK and Swiss financial systems, emphasizing the global reach of Iran’s covert financial apparatus and its central role in sustaining the regime’s nuclear, missile, and UAV programs.

The following is an executive summary of the report. For the full report, click here.

Based on reporting from U.S. financial institutions, FinCEN identified approximately $9 billion of financial activity in 2024 related to potential Iranian shadow banking activities. FinCEN’s analysis of reported financial activity (the “dataset”) revealed many aspects of the complex financial and corporate infrastructure that Iran uses to sell sanctioned oil and petrochemicals on the international market, launder the proceeds, and procure export-controlled technology for Iran’s military and nuclear program. Iranian shadow banking networks are connected across continents—most prominently in the United Arab Emirates (UAE), Hong Kong, and Singapore—by a diverse array of Iranian front companies, including oil companies, shell companies, shipping companies, investment companies, and technology procurement companies, transacting billions of dollars with each other and with unrelated companies, which may be witting or unwitting counterparties.⁶

Iran-Linked Oil Companies Transacted $4 Billion, Potentially for Illicit Oil Sales: FinCEN identified dozens of foreign oil companies in the dataset that appear to be Iranian front companies. These Iran-linked oil companies were primarily based in the UAE and Singapore and transacted (i.e., sent or received) approximately $4 billion, representing 44 percent of total funds in the dataset.⁷
Likely Shell Companies Moved $5 Billion, Primarily from China to UAE: Shell companies—which exist only on paper with no meaningful business activities—appear to play the largest role in Iranian shadow banking networks, transacting approximately $5 billion, representing

56 percent of total funds in the dataset. Likely shell companies sent approximately $4.2 billion—89 percent of which was from China-based non-resident accounts (NRAs) operated by Hong Kong-based entities. Likely shell companies received approximately $4.3 billion—72 percent of which was received by UAE-based shell companies.

International Shipping Companies Potentially Transported Sanctioned Iranian Oil: Dozens of shipping companies transacted approximately $707 million (eight percent of total funds), that were potentially related to the transport of sanctioned Iranian oil and petrochemicals. Most of these funds went to shipping companies based in Iraq (36 percent), UAE (20 percent), or Hong Kong (18 percent).
Foreign Investment Companies Potentially Provided Access to International Investment Markets: Investment companies based in the United Kingdom (UK) and UAE transacted approximately $665 million (seven percent of total funds) that were potentially related to providing Iranian entities with access to international investment trading.
Potential Technology Procurement Companies Received Funds from Iran-Linked Entities: Companies potentially facilitating Iranian procurement of export-controlled technology transacted approximately $413 million (five percent of total funds).
Dubai-Based Companies Received the Majority of Shadow Banking Funds: Companies based in the UAE (99 percent of which were located in the Emirate of Dubai) transacted the highest volume of potential shadow banking funds (approximately $6.4 billion or 71 percent of total funds) and received more funds than any other jurisdiction (approximately $5.6 billion or 62 percent of total funds).
Most Funds Sent by Hong Kong-Based Likely Shell Companies with Chinese Non-Resident Accounts: Hong Kong-based companies transacted the second highest volume of shadow banking funds (approximately $4.8 billion or 53 percent of total funds) and originated the highest volume of wire transfers (approximately $4.4 billion or 49 percent of total funds). Most Hong Kong-based companies were likely shell companies (82 percent of these funds) using China-based NRAs (81 percent of these funds).
Singapore-Based Companies Played Major Role in Illicit Oil Market: Singapore-based companies transacted approximately $2.2 billion (24 percent of total funds), which accounted for the third highest volume of shadow banking funds. Singapore-based oil companies transacted 81 percent of those funds and used accounts at financial institutions in Singapore and Malaysia.
UK and Switzerland Financial Systems Potentially Vulnerable to Iranian Shadow Banking: UK- based companies transacted approximately $540 million (six percent of total funds) using accounts at UK- or Swiderland-based financial institutions. Swiderland-based companies transacted approximately $115 million (one percent of total funds), and foreign companies transacted an additional $503 million (six percent of total funds), using accounts at Swiderland-based financial institutions and Swiss branches of foreign financial institutions.
Iranian Entities Potentially Exploited U.S. Financial Institutions: FinCEN identified two foreign companies that transferred $534 million (six percent of total funds) from U.S. bank accounts to Iran-linked entities. Additionally, foreign companies, including Iran-linked entities, transacted $361 million (four percent of total funds) using accounts with foreign branches of
U.S. financial institutions and $174 million (two percent of total funds) using accounts with foreign subsidiaries of U.S. financial institutions.

Source: “Financial Trend Analysis - Iranian Shadow Banking: Trends in Bank Secrecy Act Data,” Financial Crimes Enforcement Network, (October 2025).