US sanctions Iranian drone maker for supplying Russia's operations in Ukraine

The Iranian company's Shahed drones have been used by Russia in its air campaign against Ukraine

The U.S. Dept. of the Treasury announced new sanctions on an Iranian drone manufacturer on Friday over drones it has provided to Russia that are being used by the Kremlin in airstrikes against Ukraine.

Treasury's latest sanctions apply to eight executives who are members of the Paravar Pars Company's board of directors. The sanctions are intended to ratchet up the financial pressure on the company's leadership after prior sanctions imposed by the U.S. and European Union on the corporation failed to deter its transfer of Shahed drones to Russia. 

"Iranian entities continue to produce UAVs for Iran’s IRGC and military. More broadly, Iran is supplying UAVs for Russia’s combat operations to target critical infrastructure in Ukraine," said Under Secretary of the Treasury for Terrorism and Financial Intelligence Brian E. Nelson. "The United States will continue to aggressively target all elements of Iran’s UAV program."

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The Shahed drones made by Paravar Pars have been used by Russia in a number of "kamikaze" attacks against targets in Ukraine. The Shahed-series unmanned aerial vehicles (UAVs) are loitering munitions that are used to attack ground targets from a distance, often in numbers intended to overwhelm air defenses. Some of the strikes have resulted in civilian casualties and targeted energy infrastructure.

As of November, Ukrainian officials said that Russia had used about 400 drones in air raids against Ukraine out of a supply of about 2,000. Ukrainian President Volodymyr Zelenskyy said at the time that his country had downed 223 drones made by the Iranian regime. 

In an address to Congress delivered in late December, Zelenskyy said that Iran has joined Russia in its "genocidal policy" by supplying the Russian military with drones. 

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"Iranian deadly drones, sent to Russia in hundreds, became a threat to our critical infrastructure," Zelenskyy said in the speech. "That is how one terrorist has found the other. It is just a matter of time — when they will strike against your other allies, if we do not stop them now."

The White House first disclosed Tehran's plans to "gift" Russia hundreds of Shahed-136 drones earlier in 2022 and noted that 1,000 of the Iranian-supplied drones had been shipped to Russia by August. Iran has denied the allegations.

In January, White House National Security Adviser Jake Sullivan said that Iran's drones "are being used to kill civilians in Ukraine and to try to plunge cities into cold and darkness which, from our point of view, puts Iran in a place where it could potentially be contributing to widespread war crimes."

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The sanctions imposed by the Treasury's Office of Foreign Assets Control (OFAC) will require that all property and financial interests of the eight sanctioned Iranian executives be blocked and reported to the agency. Those covered by this round of sanctions include Paravar Pars Managing Director and CEO Hossein Shamsabadi, who is also on the board, and Ali Reza Tangsiri, who chairs the board and has been previously sanctioned for his role as the commander of the Iranian Revolutionary Guard Corps Navy.

All transactions by U.S. persons or those that occur within the U.S. involving blocked property or financial interests belonging to the eight sanctioned individuals are to be prohibited. Entities that have 50% of their ownership consisting of one or more sanctioned individuals will also have transactions blocked under the sanctions. 

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Individuals who engage in certain transactions with sanctioned Iranians may be exposed to sanctions. Foreign financial institutions that facilitate a significant transaction or provide financial services to sanctioned individuals may also face U.S. sanctions.

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