U.S. Department of the Treasury sanctions Iranian security officials and designates IRGC-linked digital asset exchanges Zedcex and Zedxion

The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) sanctioned senior Iranian officials and a businessman linked to sanctions evasion, and for the first time designated digital asset exchanges for operating in the financial sector of Iran’s economy. The action targets individuals tied to violent repression of protesters and networks alleged to support the Islamic Revolutionary Guard Corps (IRGC), including via digital assets. Those designated include Iran’s Minister of the Interior Eskandar Momeni Kalagari and multiple commanders linked to the IRGC and the Law Enforcement Forces of the Islamic Republic of Iran, under Executive Order 13553. OFAC also designated Babak Morteza Zanjani and two UK-registered digital asset exchanges, Zedcex Exchange, Ltd. and Zedxion Exchange, Ltd., under Executive Order 13902 for operating in Iran’s financial sector, with the exchanges additionally designated under Executive Order 13224, as amended, for materially assisting the IRGC; OFAC cited that Zedcex has processed over USD 94 billion in transactions since its August 2022 registration and that exchange-attributed addresses processed funds linked to IRGC-connected wallets. As a result, property and interests in property of the designated persons within U.S. jurisdiction are blocked, the 50 percent ownership rule applies to entities owned by blocked persons, and U.S. persons are generally prohibited from transactions involving blocked property absent authorization or exemption. Treasury also highlighted the longstanding general license commonly referred to as GL D-2 (31 CFR § 560.540) relating to internet access in Iran and referenced OFAC FAQs for further guidance.