The United States on Tuesday imposed sanctions on Iran's central bank governor, Valiollah Seif, and Iraq-based Al-Bilad Islamic Bank for "moving millions of dollars" for Iran's elite Revolutionary Guard Corps, as Washington seeks to cut off funding for what it says is Iran's malign activities in the Middle East.

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US Treasury Secretary Steven Mnuchin said Seif covertly funneled millions of dollars on behalf of the IRGC through Al-Bilad bank "to enrich and support the violent and radical agenda of Hezbollah."

The United States classifies Lebanon's Shi'ite Muslim movement Hezbollah, which is backed by Iran, as a terrorist group.

"It is appalling, but not surprising, that Iran’s senior-most banking official would conspire with the IRGC-QF to facilitate funding of terror groups like Hezbollah, and it undermines any credibility he could claim in protecting the integrity of the institution as a central bank governor," Mnuchin said in a statement.

The US Treasury also blacklisted Ali Tarzali, assistant director of the international department of Iran's central bank, and the chairman of Al-Bilad Islamic Bank, Aras Habib.

The department said the sanctions against Seif and Tarzali would not immediately affect central bank transactions. It said, however, sanctions being reimposed under the nuclear deal would affect certain U.S. dollar transactions by the central bank starting on Aug. 7, 2018.

Last week, two days after U.S. President Donald Trump withdrew from the 2015 Iran nuclear deal, the U.S. Treasury imposed sanctions against six individuals and three companies it said were funneling millions of dollars to the IRGC-QF.

The IRGC is by far Iran’s most powerful security entity and has control over large stakes in Iran’s economy and huge influence in its political system. The Quds Force is an elite unit in charge of the IRGC' overseas operations.

First Published:May 16, 2018 6:00 AM IST