British Banks Accused of Facilitating Iran’s Sanction Evasion

Recent reports have revealed that Iran allegedly exploited the services of two major British banks, Santander UK and Lloyds, to navigate around international sanctions. The Financial Times reported on Sunday, February 4, that documents in their possession revealed these banks provided accounts to front companies linked to sanctioned Iranian petrochemical entities.

The state-run Petrochemical Commercial Company (PCC), identified as part of a network accused by the U.S. of raising significant funds for the Iranian Revolutionary Guards Quds Force, is alleged to have collaborated with Russian intelligence agencies to finance Iranian proxy militias. Both PCC and its British subsidiary, PCC UK, have been under sanctions by the American government since November 2018.

Despite these sanctions, the report indicates that PCC’s British unit has been operating from an office in London’s Belgravia section since 2018, employing a complex network of front companies across the U.K. and other nations. The uncovered documents suggest that PCC utilised British entities to receive funds from Iranian front operations in China, concealing their true ownership through “trustee agreements” and nominee directors.

Upon reaching out for comments, Santander UK stated, “We are unable to comment on specific client relationships,” emphasising their commitment to legal and regulatory obligations and highlighting a focus on sanctions compliance. Lloyds and PCC have not responded to inquiries as of now.