Scott Bessent Hits Russia’s State-Owned Bank With New Iran Sanctions— ‘This is a China Play,’ Says Former Treasury Official

The Treasury Department has levied new sanctions against Russia’s state-controlled VTB Bank Public Joint Stock Company, accusing it of aiding Iran.

On Monday, the department alleged that VTB, Russia’s second-largest bank, helped Tehran dodge sanctions by “establishing correspondent relationships with sanctioned Iranian banks.”

The Treasury anticipates that this new financial measure will block at least tens of millions of dollars, making VTB “among the most comprehensively sanctioned financial institutions in the world.”

Notably, this is not VTB’s first encounter with U.S. sanctions, as it had previously been sanctioned in 2022 and early 2025 under the Biden administration.

Days before the announcement, Treasury Secretary Scott Bessent had warned of impending sanctions against a ‘large bank’ for aiding Iran. Although he did not disclose the bank’s name or its country, Bessent emphasized that the administration’s economic pressure on Tehran will persist until all transactions with the Iranian regime are halted. He also warned that entities engaging with the regime could face severe repercussions, including potential financial collapse.

The China-Link Flagged

Former U.S. Treasury sanctions official Miad Maleki called the move a “China play,” and said that the bank has become a key channel for Russia-China trade since 2024, after major Chinese banks pulled back.

He stated that Russian banks use Chinese accounts to settle Iranian trade payments, totaling about $1.5 billion in the past 60 days. The new sanctions could expose Chinese banks dealing with VTB Shanghai to secondary sanctions tied to Iran, potentially forcing Beijing to reconsider its support for VTB just days before Chinese President Xi Jinping meets President Donald Trump.

Bessent Launches Treasury Whistleblower Program

On Monday, Bessent also announced the Treasury Whistleblower Program, in addition to the ongoing Operation Economic Outcast,’ and urged global whistleblowers to provide actionable information to the Treasury, noting that eligible tipsters could receive rewards regardless of where they live or work.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

Image Credit: USA TODAY Network via Reuters Connect