U.S. sanctions network accused of aiding Iran’s drone and missile programs

In a statement, the Treasury Department said it was prepared to take economic action against Iran’s military-industrial base to prevent Tehran from rebuilding its manufacturing capacity.

The sanctions targeted companies in China, Hong Kong, the UAE, Belarus and Iran, including:

• China’s Yushita Shanghai International Trade Co Ltd — for helping procure weapons in China for Iran;
• Dubai-based Elite Energy FZCO — for transferring millions of dollars to a company in Hong Kong to facilitate procurement;
• Hong Kong-based HK Hesin Industry Co Ltd and Mustad Ltd, as well as Belarus-based Armory Alliance LLC — for acting as procurement intermediaries;
• Iran’s Pishgam Electronic Safeh Co — for purchasing drone engines;
• China’s Hitex Insulation Ningbo Co Ltd — for supplying materials used in ballistic missile production.

The Wall Street Journal reported on May 6, citing former U.S. Treasury Department officials and industry analysts, that Iran and Russia have increasingly been buying drone-production parts from China despite U.S. and EU sanctions.

Chinese customs data show that Chinese companies are shipping hundreds of containers packed with dual-use goods that can be used to make weapons to Russia and Iran. Cargo lists include everything from engines to computer chips, fiber-optic cables and gyroscopes.

Chinese exporters previously deliberately mislabeled some shipments to bypass U.S. and European sanctions, but in many cases, they no longer bother doing so, people familiar with the matter told the WSJ.