Oil in the Hands of Trustees: Iran’s Economy Held Hostage by Hidden Trusts
According to Iran Gate News Agency, while international sanctions have blocked Iran’s official trade routes and money transfers, a little-known network of trustees and trust companies has become the lifeline for selling oil and transferring billions of dollars in foreign currency revenue. This mechanism simultaneously aids the survival of the sanctioned economy and raises serious questions about transparency, corruption, and accountability at the highest levels of decision-making.
Trust Networks in Iran’s Sanctioned Economy: Between Emergency Function and Structural Corruption
In recent years, the role of trustees or trust-based structures in Iran’s economy has once again become a focal point for media and regulatory bodies. Trustees, in their legal definition, are individuals or entities that hold official ownership of assets but effectively act on behalf of the primary beneficiaries. In Iran, this mechanism, especially since the early 2010s, has become one of the key tools for selling oil and transferring foreign currency resources, coinciding with the intensification of financial and banking sanctions by the United States and its allies.
Information gathered from media and economic sources indicates that a significant portion of these trust networks are based in countries such as the United Arab Emirates, Turkey, and Oman—countries that have become intermediary links in Iran’s oil trade due to their geographical location and commercial ties. These trustees not only facilitate oil sales but also often handle the storage and transfer of the resulting revenues outside official banking channels.
Estimates published by various media outlets paint a worrying picture. Over the past two decades, nearly 100 individuals or trust entities have managed to accumulate around 50 billion dollars in profits—profits that the newspaper has described as systematic corrupt rents. Critics believe such figures would not have been possible without regulatory gaps and weaknesses in accountability structures.
Iran Gate News Agency describes this network as part of an opaque architecture that has nestled within the economic and political power structure of Iran. Analysis of existing data shows that the use of trustees has created a kind of ethical and governance paradox. On one hand, these intermediaries help the government secure the financial resources needed to run the country under sanctions. On the other hand, it provides grounds for serious misuse of public assets without effective oversight and sufficient transparency.
Critics warn that even attempts to bring transparency to these networks will not be without cost. Increased international pressure, intensified sanctions, and ultimately negative impacts on the daily lives of ordinary citizens are among the risks that are always discussed in this context, making decisions about reforming or eliminating these mechanisms a complex and multilayered issue.
The Transnational Dimensions of Trust Networks
A report published by The Economist in 2024 added a new dimension to this discussion. According to the report, about 200 Iranian citizens with dual nationality manage companies based on trust systems in European countries that indirectly serve Tehran’s economic interests. These findings have once again drawn the attention of Western regulatory bodies to the link between Iran’s sanctioned economy and complex legal structures abroad.
Why the Role of Trustees Has Become Controversial
A new wave of criticism peaked following a report by Fars News Agency, a media outlet close to the Islamic Revolutionary Guard Corps. On December 7, Fars announced that these trust networks had benefited from about 150 million dollars from Iran’s oil revenues just this year. According to the news agency, trustees typically keep the proceeds from oil sales with them for periods ranging from two months to a year, earning significant profits in the meantime without any specific economic activity.
This is not the first time such criticisms have been raised. In March, the Bulletin News website revealed violations involving a trust company affiliated with one of Iran’s pension funds abroad. According to the report, the company, relying on connections with security agencies and power centers in the country where it operates, had taken control of retirees’ assets.
Both Bulletin News and Shargh newspaper have emphasized that the extensive reliance on these intermediaries has paved the way for numerous scandalous cases, including the case of Babak Zanjani.
This businessman, who played a key role in selling oil and circumventing sanctions during Mahmoud Ahmadinejad’s presidency, was later arrested and convicted on charges of embezzling billions of dollars. Although his death sentence was reduced to 20 years in prison after returning part of the debts, and he was eventually released, his name remains a symbol of the risks of unregulated trust in trust intermediaries.
Zanjani calls himself an entrepreneur and claims his activities were aimed at saving Iran’s economy from the pressure of sanctions. However, in 2012, the European Union and later the United States placed his name on the sanctions list due to his role in facilitating oil trade and transferring financial resources, an action that highlights the high sensitivity of the international community towards these networks.
Increasing Dependency or Transition to Official Routes
According to Bulletin News, Iran’s dependency on trustees has significantly increased since the country was placed on the Financial Action Task Force (FATF) blacklist. Many experts believe that the maximum pressure campaign by Donald Trump’s administration has deepened this dependency and limited alternative options.
Economist Mohammad Mehrvarz, in an interview with Fars, emphasized that completely eliminating trustees is not realistic under current conditions. In contrast, former diplomat Ali Fekri believes that continuing this situation carries heavy long-term costs and that a move towards official and transparent mechanisms is necessary. According to Fars, a think tank affiliated with Amirkabir University of Technology has also proposed establishing a direct payment system to reduce the role of trust intermediaries.
In 2023, the Central Bank of Iran, in correspondence with the Supreme National Security Council, warned about the dangers of entrusting oil revenues to trustees and called for these revenues to be kept within the banking system, although it did not mention completely abandoning these structures.
However, recent reports indicate that two years later, trust networks still have significant control over Iran’s oil export revenues, even as a substantial portion of the country’s crude oil heads to the Chinese market. This reality shows that Iran’s sanctioned economy has not yet found a way to escape these costly and controversial intermediaries, at least in the short term.
