US prosecutors are seeking to seize approximately $61 million in cryptocurrency that they allege was generated through the illicit sale of sanctioned Iranian crude oil and petroleum products.
The US Attorney’s Office for the Southern District of New York said it filed a civil forfeiture complaint on Monday against the cryptocurrency, alleging that the funds were part of a broader network that moved more than $1.5 billion in proceeds from Iranian oil sales.
According to prosecutors, the money was intended to support the Iranian government and military, including the Islamic Revolutionary Guard Corps (IRGC), which the United States designates as a terrorist organization.
Prosecutors allege cryptocurrency network financed Iranian activities
Deputy US Attorney Sean S. Buckley said the action was aimed at disrupting what prosecutors described as a financial network supporting Iran and groups linked to its military and security apparatus.
The complaint alleges that Iran used cryptocurrency intermediaries in China and other locations to launder proceeds from the sale of sanctioned oil. Prosecutors said the network helped move more than $1.5 billion in funds connected to those transactions.
US authorities allege that black-market oil sales have been an important source of revenue for Iran, allowing the government to continue financing military and other activities despite US sanctions.
Chinese firms accused of moving oil proceeds
The complaint names two Chinese companies, Blessed Trust and Hexa Whale, which prosecutors allege played a role in moving funds linked to Iranian oil sales.
According to the filing, the companies maintained accounts with cryptocurrency exchange Binance in the United Arab Emirates. Prosecutors allege that Blessed Trust described itself as a wealth-management and virtual-asset custody business while receiving and transferring money generated from Iranian crude oil and petroleum product sales.
The company is also accused of helping convert conventional currencies into cryptocurrency, including through US-based cryptocurrency issuers.
Prosecutors said Hexa Whale presented itself as a commodities brokerage but provided similar financial services and worked with Blessed Trust and related entities.
Network allegedly moved more than $1.5 billion
US prosecutors identified a group of connected cryptocurrency addresses as “Entity A”, alleging that the addresses received and distributed more than $1.5 billion in proceeds tied to Iranian oil sales.
The complaint alleges that funds were transferred to money-services businesses, cryptocurrency addresses associated with the IRGC and an Iranian cryptocurrency exchange.
Authorities further allege that transactions involving Blessed Trust, Hexa Whale and individuals connected to the companies were structured to obscure the origin, ownership and purpose of the money.
The filing also alleges that the companies used the US financial system in transactions involving tens of millions of dollars.
FBI highlights cryptocurrency tracking
James C. Barnacle Jr., assistant director in charge of the FBI’s New York field office, said the case demonstrates the agency’s ability to trace cryptocurrency transactions and disrupt financial networks used to evade sanctions.
US officials said cutting off revenue generated through the illicit sale of sanctioned crude oil could reduce the funds available to Iran’s military and terrorist organizations.
The civil forfeiture complaint represents allegations by the US government and does not establish that the defendants committed a crime. The allegations must be proven in court, and the cryptocurrency can only be forfeited to the United States if a court rules in the government’s favor.
