Shadow banking (FinCEN usage) definition

Shadow banking (FinCEN usage)

FinCEN's term for the network of front companies, banks and money exchangers Iran uses to bypass sanctions and banking controls and move funds globally.

also known as

Iranian shadow banking

reviewed

2026-10-29

Cite this page

APA 7

Sanctions Evasion Reference. (2026, October 29). Shadow banking (FinCEN usage). https://sanctionsevasion.org/reference/glossary/shadow-banking/

Chicago

Sanctions Evasion Reference. “Shadow banking (FinCEN usage).” Last reviewed October 29, 2026. https://sanctionsevasion.org/reference/glossary/shadow-banking/.

BibTeX

@misc{ser-reference-glossary-shadow-banking,
  author = {{Sanctions Evasion Reference}},
  title  = {Shadow banking (FinCEN usage)},
  year   = {2026},
  note   = {Last reviewed 2026-10-29},
  url    = {https://sanctionsevasion.org/reference/glossary/shadow-banking/}
}

The date is when this page was last reviewed, not when it was first published.

This entry records how US authorities use the phrase, not a general finance definition. FinCEN states in a footnote to its October 2025 analysis that it uses “shadow banking” to refer to the network of front companies, banks and money exchangers that Iran uses to bypass sanctions and banking controls to move funds globally.

Treasury’s press releases use the same phrase for the same network. It is an enforcement label that this site reports as the agencies use it, and it is not a category the site defines on its own.

Where this term is used

What are exchange-house and rahbar networks? — A parallel payment system in which Iranian exchange houses and bank-appointed rahbar companies use front companies abroad, mostly in Hong Kong and the UAE, to receive and pay foreign currency for sanctioned Iranian banks and exporters.

Related terms

Rahbar company — A private company that an Iranian bank uses to manage its clients' international payments, typically through shell companies and exchange houses abroad.
Exchange house — A financial institution licensed to deal in foreign exchange and transmit funds for clients. In Iran-related enforcement, one that moves money for sanctioned banks through foreign front companies.
Front company — A company that carries on some real business but exists substantially to conceal the involvement of another party in its transactions.
Correspondent banking — An arrangement in which one bank holds an account for another and provides payment and other services on its behalf, usually to give it access to a foreign currency.

Where this term is used

Related terms

Sources