Shell companies and forgery: US reveals details of Iranian network in UAE

Washington and UAE are working closely to squeeze Tehran's "malign" influence

Sigal P. Mandelker, the undersecretary for terrorism and financial intelligence at the U.S. Treasury, talks to journalists at a press briefing in Dubai, United Arab Emirates, Thursday, July 12, 2018. A top U.S. official focused on sanctions on Iran linked American financial pressure on Tehran with the ongoing economic protests roiling the Islamic Republic. (AP Photo/Kamran Jebreili)
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The Iranian operatives in a recently caught UAE based ring were using a network of front and shell companies to forge documents to send money to proxies backed by Tehran, a senior US official said on Thursday.

Sigal Mandelker, Under Secretary for Terrorism and Financial Intelligence at the US Treasury, gave a detailed breakdown of a network that had been funnelling millions to the Iranian Revolutionary Guard for payment to proxy forces. The unmasking of the group was first reported in May although it was unclear exactly when the network was broken up.

"The network of currency exchange abused the UAE's financial network by transferring cash out of Iran and covering it to US dollars," Ms Mandelker said.  The funds were used to support regional proxy groups such as Lebanon's Hezbollah, Shiite rebels in Yemen and embattled Syrian President Bashar Al Assad.

She disclosed that the operation follows a close collaboration between Washington and Abu Dhabi, which designated dozens of individuals and entities on its terrorism list in May.

The individuals and groups were identified after they were found to have transferred millions of dollars to the Iranian Revolutionary Guard, the Emirates news agency said.


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Last month the UAE's central bank announced it had limited the operations of seven currency exchange companies for unspecified violation of anti-money laundering and other regulations.

Ms Mandelker hailed the Emirate's efforts, saying "there's no question in my mind that working together [with the UAE], we can take significant action [against Iran] to disrupt their ability to fund themselves."

Her visit to the region is part of Washington’s attempts to boost mechanisms to squeezing Iran with sanctions by building a global coalition. The move comes after President Donald Trump tore up an international deal on Iran's nuclear programme and re-imposed sanctions on Tehran.

Washington aims to impede "the despicable use of Iranian revenue” across the Middle East, she said, adding that governments and private sectors in the Gulf are cooperating closely with the US as they agreed on Tehran's "malign influence in the region."

The US official said that Washington was aiming to restrict Iran's trade in general, not just its oil and gas sales, which provide for over half of its export receipts.

“We are also working to mitigate its exploitation of regional financial systems for illicit purposes."

US Secretary of State Mike Pompeo on Thursday called on American allies to help ramp up economic pressure on Iran and accused Tehran of continuing to sell weapons in the Middle East despite United Nations resolutions.

"We must cut off all funding the regime uses to fund terrorism & proxy wars," Pompeo said in a Twitter post ahead of his scheduled meeting with European Union's foreign affairs and security policy representative Federica Mogherini in Brussels.

Meanwhile, Saudi Arabia’s Ambassador to the United Nations, Abdallah Al Mouallimi, accused Hezbollah of attempting to disrupt the Middle East.

“Saudi Arabia will confront the Lebanese Hezbollah militia everywhere and expose its practices to the international community,” he said in an interview with Al Arabiya television on Wednesday.

Mr Al Mouallimi’s statement came after Yemen filed a complaint at the UN against the Iran-backed Lebanese group for interfering in its affairs.

Yemen’s Foreign Minister, Khaled Al Yamani, said that Hezbollah chief Hassan Nasrallah’s June 29 speech, in which he expressed support for the Iran-backed Houthi rebels, was “a blatant intervention in the internal affairs of my country, which would cause great damage to Yemen’s supreme interest and national security”.

The Saudi-led coalition, which includes the UAE, intervened in the Yemen war in March 2015 at the request of Mr Hadi’s government. Pro-government forces and the alliance launched an offensive on the city of Hodeidah on June 13.