The US in collaboration with the UAE has slapped sanctions against six individuals and three companies, accusing them of financing network and helping funnel dollars to Iran's elite military unit known as the Quds Force.
The move comes after US President Donald Trump declared that he was withdrawing from the Iran nuclear deal, the 2015 agreement reached by seven countries after more than two years of gruelling negotiations.
Iran said it will remain in the deal, which tightly restricted its nuclear ambitions for a decade or more in return for ending the sanctions that had crippled its economy.
So did France, Germany and Britain, raising the prospect of a trans-Atlantic clash as European companies face the return of American sanctions for doing business with Iran.
The US and UAE took action to disrupt an extensive currency exchange network in Iran and the UAE that has procured and transferred millions in US dollar-denominated bulk cash to Iran's Islamic Revolutionary Guard Corps-Qods Force (IRGC-QF) to fund its malign activities and regional proxy groups, the Department of Treasury said.
Specifically, the Treasury designated nine Iranian individuals and entities. Iran's Central Bank was complicit in the IRGC-QF's scheme and actively supported this network's currency conversion and enabled its access to funds that it held in its foreign bank accounts.
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This network of exchangers and couriers has converted hundreds of millions of dollars, the US said.
"The Iranian regime and its Central Bank have abused access to entities in the UAE to acquire US dollars to fund the IRGC-QF's malign activities, including to fund and arm its regional proxy groups, by concealing the purpose for which the US dollars were acquired," Treasury Secretary Steven T Mnuchin said.
The US is intent on cutting off IRGC revenue streams wherever their source and whatever their destination, he said.
"Today we are targeting Iranian individuals and front companies engaged in a large-scale currency exchange network that has procured and transferred millions to the IRGC-QF," he added.
"The Treasury Department thanks the UAE for its close collaboration on this matter. Countries around the world must be vigilant against Iran's efforts to exploit their financial institutions to exchange currency and fund the nefarious actors of the IRGC-QF and the world's largest state sponsor of terror," Mnuchin said.