Treasury Secretary Scott Bessent warned the Trump administration is ready to use "financial violence" against Iran, planning weekly sanctions on banks facilitating Tehran's economy.

The US Treasury has sanctioned five United Arab Emirates branches of Egypt’s state-owned Banque Misr, cutting them off from the US financial system. The move targets a network that processed about $1.8 billion for 103 companies linked to Iranian shadow banking between January 2024 and June 2026. The proposal remains subject to a 30-day comment period.

Escalating pressure on banks handling Iranian funds

Bessent told The Associated Press ahead of Group of 20 meetings in Asheville, North Carolina, that the administration is showing it knows who is aiding the regime. "This is going to be financial violence if we have to," he said. "We are showing people that we know who you are, you know who you are, and this has got to stop."

The threat marks the next phase of Operation Economic Outcast, part of the "Economic D-Day" campaign. Treasury launched the operation on August 24, sanctioning nearly 60 Iran-linked entities, individuals and vessels while expanding secondary sanctions across digital assets, technology, gold, aviation and shipping.

Key details of the sanctions plan

The Treasury's approach focuses on secondary sanctions, applying to non-US entities conducting business with Iran. This extends enforcement beyond domestic institutions to foreign banks with exposure to Iranian funds.

How Iran Moves Money

Shadow banking refers to networks of shell companies and trading businesses used to obscure connections to Iran. These channels operate across the UAE and Hong Kong, moving oil and petrochemical proceeds around US sanctions. The targeted Banque Misr branches were connected to this flow.

Why China Is In Focus

China is becoming a bigger test for the campaign due to its role in Iran’s oil trade. China bought more than 80% of Iran’s exported oil in 2025. While the campaign has reached companies in mainland China and Hong Kong, it has not yet targeted a major Chinese bank.

Iranian crude is frequently rebranded as Malaysian oil before being sold to Chinese buyers. Reported oil imports from Malaysia far exceed Malaysia’s own reported exports, signaling potential sanctions-evasion activity.

Asked whether Washington could sanction Beijing over continued purchases, Bessent said "all options are on the table." He dismissed suggestions that the administration was reluctant to confront China as "a completely false narrative that the media picked up on." Bessent had previously warned that countries maintaining ties with Tehran risk "economic oblivion."

What Could Come Next

Analysts suggest Washington could target Chinese financial institutions, particularly Bank of Kunlun, which is controlled by China National Petroleum Corp. The US cut the bank off from correspondent banking in 2012, but measures were largely symbolic due to limited dollar-based business.

Treasury could also use Section 311 of the Patriot Act to impose greater scrutiny on transactions showing signs of evasion, such as large round-dollar payments or unclear business purposes. The broader campaign already includes sanctions on digital assets, technology, gold, aviation, and shipping.

Military Context

The financial push comes as military hostilities flare again for the first time since late July. U.S. forces struck two Iranian launchers on Larak Island near the Strait of Hormuz on Sunday. Iran then fired missiles toward U.S. bases in Jordan.