The crackdown comes two days after Trump withdrew from the 2015 arms accord and as US Secretary of State Mike Pompeo pushes allies in Europe, Asia and the Middle East to pressure Iran to return to negotiations over its nuclear and missile programs.

Trump's decision has given grace periods of 90 days to six months for companies to wind down their trade with Iran.

In February 2015, Reuters reported that at least $US1 billion in cash had been smuggled into Iran despite US and other sanctions. Before it reached Iran, the cash was passed through money changers and front companies in Dubai, the United Arab Emirates, and Iraq, sources said.

The report said Iran's central bank had worked with other entities, including sanctioned Iranian companies, to find ways to obtain US dollars, including using front companies and their networks. They said the central bank had given the orders to the front companies abroad to buy dollars.

Before the 2015 nuclear deal was reached, front companies had mushroomed in Dubai to facilitate payments to Iran. The use of multiple such companies, which bought US dollars from currency traders in Dubai and Iraq, was preferred as it concealed the overall size of the dollar purchasing operation.

Reuters