Russia’s secret $2.5bn cash shipments to Iran

A state-owned Russian bank started deliveries totalling around $2.5bn (£1.9bn) to the Islamic Republic just days after Donald Trump imposed punishing sanctions on Tehran during his first term as US president, News.Az reports, citing The Telegraph.

Nearly five tonnes of banknotes were sent in 34 bulk shipments over four months in 2018.

Each shipment – worth between $57m and $115m – was sent between Promsvyazbank, on Moscow’s Smirbovskaya Street, and Iran’s central bank on Tehran’s Mirdamad Boulevard, documents obtained by The Telegraph show.

Source: The Telegraph

The covert payments reveal a much deeper relationship between Russia and Iran than previously known, with Moscow and Tehran circumventing sanctions and traditional payment methods to keep the Iranian regime afloat.

There are fears that similar payments could be being made today, as Iran ships billions of dollars’ worth of Shahed-136 kamikaze drones and Fath-360 short-range ballistic missiles to support Russia’s war in Ukraine.
The Russian deliveries of cash started after the Iranian regime harshly subdued a wave of protests about the country’s economic difficulties in 2018.

Promsvyazbank, which Moscow used to avoid sanctions, made the first of the shipments on Aug 13, 2018 – a week after Mr Trump signed an executive order that imposed sanctions on Tehran.

That shipment was 110kg of cash worth $57.3m that probably travelled by train to the port of Astrakhan and then by ship across the Caspian Sea to the port of Amirabad, and then on to Tehran, again by train.

It is believed that the cash was stacked in €500 notes, given the weight and value of each shipment, although its value was registered in US dollars.

Anna Borshchevskaya, an expert in Russian policy toward the Middle East, told The Telegraph that the transfers showed how Moscow finds inventive ways to “prop up” the Iranian regime during times of crisis.

Asha Castleberry-Hernandez, a former senior adviser on the Middle East at the US state department, said cash shipments enabled Moscow’s support for Tehran to remain “covert”.

Ms Castleberry-Hernandez claimed the shipments showed how invested the Kremlin was in the Iranian regime’s survival and said they had probably been made “out of desperation”.

“It’s a balancing act where they want to help Iran but don’t want people to know they’re doing it,” she said.

“They try to be secretive because they calculate that most of the international community are against the Iranian regime and are more for the people.”

Ariane Tabatabai, a senior aide to the special envoy for Iran under the Biden administration, speculated that the deliveries could have been in payment for a broad range of military purchases or in support of organisations like the IRGC (Islamic Revolutionary Guard Corps).

“Given the very comprehensive sanctions that are in place against both countries and that Iran has been effectively cut out from Swift and other [banking] mechanisms, I don’t find it particularly surprising that they would use cash,” she said.

Once a private bank, Promsvyazbank was taken over by the Kremlin in 2017 and repurposed to finance the defence sector and avoid US sanctions.

After the takeover, Russia’s central bank said it would become a “special purpose bank for serving military-industrial-complex businesses”.

Petr Fradkov, the son of a former head of Russia’s foreign intelligence service, was in charge of the bank at the time of the payments, having been appointed in January 2018.

Mr Fradkov was sanctioned by Britain and the US after Vladimir Putin’s full-scale invasion of Ukraine in 2022.

Promsvyazbank has since been sanctioned by Britain and the US and has also been implicated in pro-Kremlin election interference campaigns.

The Financial Times reported on Thursday that Promsvyazbank has also worked with a Moldovan oligarch since late 2024 to issue colourful imitation banknotes, designed to keep Russian money flowing around the world despite Western restrictions.

The notes can also reportedly be redeemed for a cryptocurrency token launched last year which is marketed as a rouble-pegged stablecoin backed by state bank deposits.

Delivered to Tehran

Source: The Telegraph

The tonnes of cash from Promsvyazbank were delivered to the Islamic Republic’s central bank in Tehran, according to trade records shared with The Telegraph by ImportGenius, which compiles customs records it gathers from private sources. Both banks have been contacted for comment on the findings.

Abdolnaser Hemmati was the governor of the Iranian central bank at the time and presided over a tumultuous period between 2018 and 2021, facing the fallout of Mr Trump’s sanctions.

Richard Nephew, deputy special envoy for Iran under the Biden administration, told The Telegraph that there were “several reasons” why payments of that kind could be in play, but said he would not be surprised if they were a bid to stabilise Iran’s economy.

“If you had told me in 2020 that the Iranians would be providing missiles and drones to Russia, I would have said you were crazy, but now we see it,” Mr Nephew said.

“There were all sorts of things involved in the partnership and alliance that they’ve been trying to build and helping prop up the rial and shore up the Iranian economy completely fits within that.”

The military build-up came in response to Iran’s brutal suppression of mass demonstrations, in which at least 6,000 people were killed by the theocratic regime, according to human rights groups.

Moscow’s relationship with Tehran has blossomed since its invasion of Ukraine, resulting in military partnerships and purchases of Iranian Shahed drones for the war effort.

Mr Hemmati was reappointed to the role at the head of the bank on Dec 31 last year, after the previous governor resigned as the nationwide protests broke out, raising the possibility that similar transfers of funds between Russia and Iran could be happening once again.

“It could put them at a huge geopolitical disadvantage,” she said.

Ms Borshchevskaya, a senior fellow at the Washington Institute, said Moscow’s motivation for sending banknotes was probably that “there’s a lot more that you can do with cash that is impossible to trace”.

She also warned that these payments could be continuing this year.

“I would say Russia is giving more but it’s appropriate for the times because we’re in a situation where the Iranian regime needs more support compared to 2018,” she said.

“These protests are the biggest the Iranian regime has seen in years, we’ve even seen rumours of [the Ayatollah] Khamenei potentially fleeing to Moscow.

“Just because Russia didn’t provide immediate direct military support, it’s easy to think that there’s nothing to see here. But this actually couldn’t be further from the truth. This is exactly the type of support that we should be worrying about.”