British Banks Accused of Facilitating Iranian Sanctions Evasion: Lloyds and Santander Under Scrutiny

The Financial Times has reported allegations that two major British banks, Lloyds and Santander UK, were involved in facilitating Iran's evasion of sanctions and illicit money transfers worldwide. According to the report, these banks provided accounts to British front companies established by Iranian intelligence, with ultimate ownership linked to a state-controlled Iranian petrochemicals company. The Petrochemical Commercial Company (PCC), accused by the US of aiding the Iranian Revolutionary Guards Quds Force and collaborating with Russian intelligence to fund Iranian proxy militias, utilized London-based entities for financial operations.

David Asher, a senior fellow at the Hudson Institute and former US State Department official, expressed concern over UK banks' dealings with entities connected to the Islamic Revolutionary Guard Corps (IRGC), labeling it a significant risk and inconsistent with stated policies towards the Iranian regime.

"For UK banks to continue doing business with them is not only a major risk but is inconsistent with stated policy towards the Iranian regime," he said.

The report detailed how PCC's UK division continued operations from an office near Buckingham Palace, using front companies to conceal its activities. Despite being under US sanctions since November 2018, PCC utilized UK-based companies to receive funds from Iranian entities in China through trustee agreements and nominee directors.

One such company, Pisco UK, registered in Surrey, utilized a business account with Santander UK. Documents revealed that Pisco UK, allegedly fully controlled by PCC, received transfers from a Chinese entity called Black Tulip, identified as another trustee company controlled by a PCC employee. While Santander declined to comment on specific client relationships, it was reported that the bank closed Pisco's account.

"Lloyds Banking Group said it could not comment on individual customers but complied with sanctions laws, adding: 'In addition, due to legal restrictions, we cannot comment on the submission of suspicious activity reports to relevant authorities when and if they occur.'"

"Tory chair of the Commons foreign affairs committee, Alicia Kearns, said: 'For years I have repeatedly raised my concerns about our need to shut down cut-outs of the IRGC operating in the UK. This investigation proves once again that more needs to be done.'"

Further revelations from the report indicated PCC's engagement with a Turkish company, ASB, which was sanctioned by the US government in connection with senior IRGC officials. Additionally, PCC UK's office in Belgravia served as the registered address for NIOC International Affairs (London) Ltd, a division of Iran's sanctioned national oil company, accused by Washington of financing IRGC and Iranian military activities.

By fLEXI tEAM