US slaps new penalties on Russia's VTB Bank over Iran sanctions evasion

The United States on Sept. 14 imposed new sanctions against VTB Bank, one of the largest financial institutions in Russia, for its role in helping Iran evade sanctions, the U.S. Treasury announced.

The designation is part of Operation Economic Outcast, the Treasury's plan to isolate Iran economically. Treasury Secretary Scott Bessent first announced the plan in August, six months into the U.S. war against Iran.

The Treasury's Office of Foreign Assets Control (OFAC) designated VTB Bank on Sept. 14 for "operating in the financial sector of the Iranian economy," saying the institution had opened bank offices in Iran in recent years to expand trade and cooperation between Tehran and Moscow.

VTB Bank has partnered with sanctioned Iranian financial institutions and has helped tranfer billions in frozen Iranian assets, the Treasury said.

"Under Operation Economic Outcast, Treasury will continue to target and disrupt those who provide material, technological, or financial support that allows the Iranian regime to sustain its terrorist enterprise," Bessent said.

The new sanctions block any VTB Bank assets that are held in the U.S. or by U.S. nationals. Any entities owned directly or indirectly by VTB Bank are also blocked, and those who violate the sanctions measures are subject to criminal or civil penalties.

VTB Bank was previously sanctioned by the U.S. in 2022 and 2025, in relation to Russia's full-scale war against Ukraine.  

"VTB is now among the most comprehensively sanctioned financial institutions in the world," the U.S. Treasury said in a press release accompanying the updated sanctions designation.

Russia and Iran have deepened economic and military cooperation since the start of the full-scale war, when Tehran supplied Moscow with Shahed drones to launch against Ukraine.

In turn, Russia has pledged to support Iran during its war with the U.S. Russian President Vladimir Putin told his Iranian counterpart Masoud Pezeshkian on Sept. 1 that Moscow is "trying to provide you with the assistance you need."

Bessent, however, has previously downplayed Russia's aid to Iran.

"They don't really get direct financial support from Russia," Bessent told the right-wing outlet Newsmax earlier in September.