The Central Bank of the United Arab Emirates ordered an urgent forensic examination of Banque Misr's branches in the country after the US Treasury Department moved to restrict the Egyptian state bank's UAE operations from access to the American financial system over allegations that they helped Iran's government access US dollars and evade sanctions.
What happened
The US Treasury's Financial Crimes Enforcement Network (FinCEN) announced on August 28 that it was proposing a rule concerning Banque Misr's UAE branches as a financial institution of "primary money laundering concern." The proposed special measure would prohibit US financial institutions from opening or maintaining correspondent accounts for or on behalf of Banque Misr UAE and would require measures designed to prevent foreign correspondent accounts from being used to process transactions involving the branches.
The action was issued as a Notice of Proposed Rulemaking rather than an immediately effective final rule. The public comment period associated with the proposal has since passed.
Update, October 2, 2026: FinCEN's current official Special Measures register continues to list the August 28 Banque Misr UAE action as a proposed rule and does not list a final rule for Banque Misr UAE. The passing of the comment deadline should therefore not be interpreted as confirmation that the proposed restriction has taken effect.
On the same day as the Banque Misr proposal, the Treasury's Office of Foreign Assets Control separately sanctioned Reza Mohammad Taeedi, the regional manager of Bank Melli's Dubai branch, and blacklisted Kameng Trading Ltd., a Hong Kong-registered firm the department accused of laundering money for an Iranian exchange house.
The UAE central bank responded by saying it had decided to conduct what it called a special and urgent examination of Banque Misr's UAE branches, including a forensic lookback covering the same period cited in the US Treasury's statement.
Key details
Treasury said that between January 2024 and June 2026, Banque Misr's UAE branches processed roughly $1.8 billion for 103 companies it believes were linked to Iranian "shadow banking" networks. According to the department, those networks allegedly included front companies tied to Iran's Ministry of Defense and the Islamic Revolutionary Guard Corps, used to evade sanctions, procure weapons, finance Iran-aligned proxy groups, and move money benefiting Iran's Supreme Leader.
Banque Misr, Egypt's second-largest bank, is state-owned and headquartered in Cairo; its UAE branches have operated since 1974, originally set up to support trade flows between the two countries and serve Egyptian expatriates in the Gulf.
What officials said
Treasury Secretary Scott Bessent framed the move as part of a wider campaign, describing it at the time as the first step in holding the bank accountable for its alleged support of Iran.
The UAE central bank, in its statement, stressed that Banque Misr's local branches remain subject to UAE law and that banks licensed in the country are expected not to expose the UAE's financial system to reputational risk. It said it was studying options regarding the branches' status depending on how the US process concludes, while noting it would take account of the bank's obligations to its UAE customers.
The Central Bank of Egypt said the US measure is limited strictly to Banque Misr's UAE branches and their dollar transfers, and does not extend to any other Egyptian bank or to Banque Misr's operations inside Egypt or elsewhere abroad.
Why it matters
The action forms part of what the Treasury has called Operation Economic Outcast, a campaign targeting financial networks the US government says are used by Iran to evade sanctions and retain access to the international financial system.
By proposing a targeted measure against Banque Misr's UAE branches rather than applying the measure to Banque Misr's operations in other countries, FinCEN kept the proposed action specifically focused on the UAE branches.
For the UAE, the episode places its banking regulator in the position of examining a foreign state bank's branches operating within the country while the US regulatory process remains unresolved.
What happens next
The public comment period on FinCEN's Banque Misr UAE proposal has passed, but that does not itself make the proposed special measure a final rule.
As of October 2, FinCEN's official Special Measures register lists the Banque Misr UAE action under its August 28 Notice of Proposed Rulemaking and shows no final rule for the institution. A separate FinCEN proposal announced on October 1 concerns the A7 Network's sub-agents and should not be confused with a final decision on Banque Misr UAE.
The UAE central bank's forensic examination was also announced separately from the US rulemaking process. No final US restriction against Banque Misr UAE should be treated as effective in this article unless FinCEN subsequently publishes a final rule or another authoritative notice establishing that status.
Update, October 2, 2026: This article has been updated after the public comment deadline to clarify that FinCEN still lists the Banque Misr UAE measure as a proposed rule. The article does not treat expiration of the comment period as adoption of the proposed restriction.
