Inside Iran's Secret $2 Billion Military Supply Web Operating Under US' Nose

Iran has reportedly built a secret network of more than 5,000 military agencies, all operating under names starting with "MOD, to import at least $2 billion in hardware, explosives and heavy-duty trucks since January 2025. This has continued despite the US naval blockade and Western sanctions, a Reuters investigation has found. 

The findings offer a window into how Iran has been able to replenish its missile and drone arsenals while firing thousands of them during the conflict that started with the American and Israeli strikes on February 28.  

The investigation found the sophisticated apparatus was linked to the Islamic Revolutionary Guard Corps and to business conglomerates known as 'bonyads' that are controlled by Iran's elite, and its financial footprints can be traced in landing bills and other shipping data dating back to 2016. 

Reuters found no evidence that Western governments have ever sanctioned any of the numbered entities. 

How The Network Works

The network, identified for the first time by Reuters in collaboration with the Israeli-American risk consultancy 240 Analytics, reportedly acts as the backbone of Tehran's military procurement and sanctions evasion apparatus. These agencies operated under the same naming pattern that began with the letters MOD -- or VODJA in Farsi -- and followed by a five- or six-digit number spelt out in long form.

All share the Tehran address of the defence ministry and claim a founding date of February 11, 1979, the day Ayatollah Khomeini took power. Corporate records show most were actually created in 2013, when sanctions were crushing Iran's oil exports and currency.

They used a web of frontmen and foreign shell companies, collectively known as trustees, who use the proceeds from illicit oil sales to replenish Iran's missile and drone arsenals. 

In 97 per cent of the shipments Reuters reviewed, the transactions were settled "without currency transfer", so little money crosses borders where it might trigger sanctions alerts.

Key imports through these entities reportedly include rocket propellants, components, and heavy-duty launchers, sourced from nations like China, Russia, and Germany.

How It Was Found

Noam Binstok, an economist at 240 Analytics, spotted the pattern in June 2025 while processing leaked Bank Sepah documents, which handle IRGC salaries and were circulating on Telegram and the site WikiIran. The balances stunned him. Thirty-six agencies held $1.2 billion in foreign currency at the end of 2024, and the rest held about $1.8 billion in local currency.

He later found the agencies were receiving oil revenue and buying dual-use equipment. Every agency carries a unique 11-digit ID that recured on shipping documents, invoices and bank accounts, which made the network traceable even behind front companies. Reuters then cross-checked part of roughly 19,000 import records against shipping papers, social media footage, satellite imagery and state media.

The Biggest Buyer

One agency, MOD 346428, stood out. Its imports grew from $442 million in the year to March 2023 to $988 million the next year, placing it among Iran's top ten importers. From January 2025 to June 2026, it brought in $2.3 billion of military hardware, including rocket propellant ingredients, explosives and weapons components.

Between January and April 2025, it imported 886 tonnes of chemicals, including sodium chlorates and other perchlorates, key precursors for solid rocket fuel, through Bandar Abbas. Their origin was listed as China.

Quoting sources, Reuters reported that the 26 April 2025 explosion at the Port of Shahid Rajaee in southern Iran was caused when sodium perchlorate from one of the shipments ignited while in dockside containers. Iranian state media reported that the chemicals were stored by Sina Port and Marine Services Development Co, which is owned by Bonyad Mostazafan, a multi-billion-dollar foundation directly controlled by the supreme leader of Iran.

The explosion killed at least 70 people and injured more than 1,200. 

Trucks And Launchers

The agency also imported 435 Iveco trucks, a type the military uses as camouflaged mobile missile launchers. A 2022 purchase of six similar trucks was ultimately delivered to Sahara Thunder, a drone maker the US sanctioned in 2024 for trading with Russia.

MOD 346428 also brought in thousands of Toyota Hilux and Land Cruiser pickups, which the IRGC modifies to mount heavy machine guns. Iveco said any presence of its vehicles in Iran was outside its control, and Toyota said it does no business in Iran.

Imports Through The War

Deliveries continued after the war began on February 28, Reuters found. In the preceding weeks, Iran received 93 tonnes of Chinese titanium, a high-strength metal that the weapons and sanctions experts said can be used to build missile airframes and rocket motor casings.

It also imported 268 tonnes of nitrocellulose and 276 tonnes of other chemicals originating in China and listed under the code that includes perchlorate – ingredients for both rocket propellant and explosives.

Monthly imports dropped 47 per cent to $54 million in March but rebounded to $77 million by May. 

Russian detonators worth $7.6 million also arrived in Iran in five shipments, the last one in June. Goods worth $27 million were recorded as originating in the UAE, the most recent arriving days after the US briefly suspended its blockade in June. 

Iran has also bought precision machinery, such as computer-controlled lathes and electron-beam furnaces, that could be used to build missile and drone bodies.

Reactions

Experts who reviewed the findings called it an "industrial-scale effort" to rebuild Iran's drone and missile fleet. They also stressed that much of the material is dual-use and could have civilian purposes.

Responding to Reuters' findings, a US Treasury spokeswoman said the US "has severed the regime's economic lifelines."

"While the regime may continue its desperate attempts to evade our powerful sanctions, fund its military and weapons programmes, and access foreign currency, we are always 10 steps ahead," the spokeswoman said.

A former senior US Treasury sanctions official, Miad Maleki, however, called the system the military's "lifeline" and the "complete ecosystem" of its trade.

"What you have here is the regime's military lifeline during this conflict and for many years before...This is the complete ecosystem of the Iranian military's trade business," Maleki, who helped design the American sanctions programme against Iran, told Reuters.

China's Foreign Ministry said it was "unaware" of the situation. "We firmly oppose attempts to maliciously link regional hostilities to China or smear China's reputation," the ministry said in a faxed statement to Reuters.

So far, Iranian entities, Russia's Defence Ministry, the White House, CENTCOM and the UAE have not commented on the findings.