On August 24, Treasury Secretary Scott Bessent announced Operation Economic Outcast, a campaign targeting Iran's financial system. More than 60 entities, individuals and vessels received designations in the first round, with Bank Melli, one of Iran's largest state banks, singled out for complete closure of its foreign branches.
Bessent warned that any entity facilitating money laundering for Iran would be removed from the US dollar system. Britain designated Bank Melli's London subsidiary, Melli Bank plc, under its Iran nuclear sanctions regime, citing different legal grounds than the American money-laundering allegations.
Melli Bank plc holds a full banking license from British financial regulators and operates as a registered English company, with all shares owned by Bank Melli Iran, which belongs to the Iranian state. The bank's latest audited accounts, filed in June 2026, show it specialized in financing Iran-Europe trade through letters of credit, earning about 92 percent of revenue in euros.
Since the bank's designation in late September, Britain's Treasury has permitted only four types of payments through a general license: staff wages and severance, pensions, IT costs, and accounting fees. The bank must report every payment line by line monthly to the Treasury, and its Hong Kong staff departed in January when salary payments failed to arrive.
Board compensation rose to €905,000 in 2025 while the bank's profit fell 92 percent to €181,000, less than half its legal and professional costs. The bank's auditor formally warned of material uncertainty over whether it could continue as a going concern.
Britain's Chancellor John Healey welcomed Operation Economic Outcast on August 25, the day after Bessent's announcement, and pledged cooperation with Washington on economic pressure. The bank remains licensed and operational pending further action from British authorities.
