In recent months, the way the United States applies economic pressure on Iran has changed. Alongside expanding sanctions and threatening secondary sanctions against those who help Iran transfer funds and smuggle oil, American enforcement is targeting the country’s most important source of revenue more directly.
Ella Rosenberg, a senior researcher at the Jerusalem Center for Foreign Affairs and Security (JCFA) and a member of the Deborah Forum, describes to Davar how the Iranian regime and the Islamic Revolutionary Guard Corps have developed expertise in evading sanctions over many years—through shell companies, transfers via third parties, alternative payment channels and complex trade networks. In her view, this is one reason why even heavy economic pressure does not automatically translate into the regime’s collapse.
According to Rosenberg, the change in sanctions enforcement is indeed significant, but it is unwise to expect economic pressure to lead to a single, clear moment when the regime breaks. She compares Iran to the Soviet Union in its final years. “People keep asking me when the regime will fall, but, like the fall of the regime in the Soviet Union, it is a process that takes time and does not begin with the collapse of the government.” She says that during periods of prolonged decline, the mechanisms of power can actually continue accumulating resources. “As the system gradually collapsed toward the end, we saw that the KGB actually grew richer.”
Rosenberg draws a distinction between two overlapping systems: “I keep talking about the separation between the Islamic Revolutionary Guard Corps’ economy and Iran’s economy.” She explains that state-owned companies and the Revolutionary Guards are intertwined through overlapping ownership records involving companies, assets, associates and revenue streams that are separate from the state budget.
Therefore, even a severe blow to state revenues does not necessarily weaken the power of the Islamic Revolutionary Guard Corps. Over the years, it has accumulated wealth, assets and its own funding mechanisms, building a system capable of shifting its activities from one channel to another.
“Sanctions are being enforced more rigorously today than in the past. Is enforcement airtight? No, but it is an improvement,” Rosenberg says. “Before the war, sanctions against Iran were barely enforced. Even the enforcement that did take place was extremely superficial.”
“There Is No Motivation to Enforce the Sanctions”
The difficulty begins with the question of exactly who is being sanctioned and who owns the asset. Rosenberg describes from personal experience what enforcement looked like in Europe several years ago. In 2018, she lived in a city in Rotterdam, the Netherlands, in a building that, she says, housed the offices of Iran’s national oil company, NIOC. “They were based in central Rotterdam, in very expensive real estate in Europe’s largest port city, and nothing was done to them.”
Another prominent example of the failure to enforce sanctions is the fact that the U.S. Treasury Department only sanctioned the luxury Hilton hotel in Frankfurt, which is linked to Supreme Leader Mojtaba Khamenei, last July. This came after the department described businessman Ali Ansari as managing “an extensive global network of assets benefiting Iran’s leader, Mojtaba Khamenei, and other regime elites.”
“If, for example, my uncle is someone in the Revolutionary Guards and he registers a hotel in my name, go ahead and prove that he’s my uncle,” Rosenberg says. “It’s very difficult to work backward through the process.”
In other words, a sanctions list is only the first step. Authorities must then identify the real beneficiary, prove the link between them and the asset, and persuade a bank, regulator or court in another country to act. Rosenberg describes a system in which the financial institutions authorizing these transactions often lack the motivation to enforce the sanctions.
“The Iranians Are Running Circles Around Us”
For years, Iran’s shadow fleet has allowed it to circumvent sanctions through shell companies, changes in ownership and ship-to-ship oil transfers in the middle of the sea. “The Iranians are simply running circles around us,” Rosenberg says. “The Islamic Revolutionary Guard Corps are masters of these workarounds, because this is the reality they live in.”
Estimates vary as to how much oil is being smuggled out of Iran, but there has been a significant decline in recent months due to the American blockade, which includes direct attacks on tankers attempting to breach it. Nevertheless, Rosenberg warns that the Iranians tend to be highly creative in finding ways around restrictions.
“Stopping the oil is good and important, and it is an integral part of the effort,” Rosenberg stresses. “But the Islamic Revolutionary Guard Corps has several sources of funding and ways to protect its assets. Once you shut down one source of funding, it makes perfect sense that another source will grow stronger.”
“They Didn’t Believe Human Trafficking Was a Source of Income”
One of the additional sources of revenue Rosenberg points to is human trafficking. She says that when she began researching the subject in 2024, the very suggestion that the Islamic Revolutionary Guard Corps was involved in the trade and generating revenue from it was met with considerable skepticism. “People laughed in my face,” she recalls. “They refused to believe that the Revolutionary Guards were doing this. They didn’t believe it was a source of income.”
The U.S. State Department’s 2025 Trafficking in Persons Report describes the systematic exploitation of Iranian and Afghan children in Iran for forced labor, widespread begging and street work, and the recruitment of children into armed groups. The report also highlights the particular vulnerability of Afghan migrants and refugees, as well as the lack of investigation into the phenomenon and public attention to it.
Rosenberg describes minorities and migrants who, she says, are recruited with promises of a better life, only to find themselves far from their places of origin, including in combat zones. “In the past, they were recruited to Syria, and today they are also reaching the Russian front against Ukraine.” She links the phenomenon to barter arrangements between Iran and Russia, but stresses that its exact scale is unknown. “Part of the problem is that this has not been fully investigated. As long as people are not sent into the field to examine what is happening along the borders, the phenomenon remains under the radar.”
The Crypto Market Makes Enforcement More Difficult
Rosenberg cites the case of Binance, the world’s largest cryptocurrency exchange, as an example of the gap between sanctions and their enforcement. In 2023, the exchange pleaded guilty to violations of anti-money laundering and sanctions laws and agreed to pay a $4.3 billion fine. According to the U.S. Department of Justice, the company had enabled transactions worth nearly $900 million between users in the United States and users in Iran.
The Islamic Revolutionary Guard Corps’ shift toward cryptocurrency trading makes enforcement a much longer process of pursuit: authorities must link a digital address to a real person, build an evidentiary chain, identify which exchange holds the funds, and then contact it to request a freeze. “It is possible using certain methods. There are companies that investigate this; it’s nothing new. But the process of gathering information and conducting checks takes time,” Rosenberg explains. “To stop the money, you have to go to that exchange and tell them to freeze it.”
Even then, once an order has been issued against an account on an exchange, the freeze is subject to local regulations. “Binance can freeze an account only in accordance with the license it holds in the country where it operates. In one place, the account will be shut down, while in another, it will remain free to operate.”
“The Children’s Social Media Profiles Expose the Money”
What is hidden in obscure financial channels comes to light on digital platforms. “Look at the Instagram accounts of the children of Islamic Revolutionary Guard Corps members,” Rosenberg says. “Their uncle or father may have become wealthy through human trafficking or sanctions evasion.” She describes a common practice of registering assets in the names of relatives who are not officially affiliated with the Revolutionary Guards, in order to evade sanctions.
“Some of this wealth is on display on their Instagram accounts: luxury cars, apartments and lavish weddings. I recommend that readers visit the RICH KIDS OF IRAN Instagram page and see for themselves. Many of these children are connected to the Revolutionary Guards.”
A well-known example is the family of Ali Shamkhani, a former commander of the Islamic Revolutionary Guard Corps Navy and a senior figure in the regime’s leadership. In 2025, a video from his daughter’s lavish wedding, where she wore a revealing wedding dress, went viral online. That same year, the United States imposed sanctions on his son, Mohammad Hossein Shamkhani, alleging that he operated a shipping network used to transport Iranian and Russian oil and evade sanctions.
“The Private Sector Is Not Afraid to Work with the Revolutionary Guards”
For Rosenberg, the next step is not to add more names to sanctions lists, but to make enforcement effective enough to create genuine deterrence. “The reality today is that the private sector is not afraid to work with the Revolutionary Guards.”
According to Rosenberg, fines alone are not enough. In appropriate cases, criminal consequences are also necessary, along with a fundamental change in the composition of the enforcement apparatus. She notes that the campaign is currently being led largely by security personnel, even though the arena itself is financial. “You need to bring in people who have worked in finance and anti-money laundering, who have done this hands-on and know how it works, and let them build this enforcement capacity. You cannot assign this kind of specialized work to a security official simply because the target is an enemy.”
Rosenberg agrees that sanctions and the blockade have inflicted some damage on the Revolutionary Guards, but qualifies this assessment: “You have to understand that the Revolutionary Guards became so wealthy by that point that trying to unravel it all is extremely difficult.”
The next major test will be reaching the Revolutionary Guards’ other sources of income, as well as the companies, assets and financial systems that allow them to make use of the vast wealth they have accumulated.