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In April 2026, over a month after the United States launched its attack on Iran, leading to thousands of reprisal strikes across the Gulf, the United Arab Emirates shut down a network of money changers connected to the Islamic Revolutionary Guard Corps. Iranian exchange houses and the shell companies built around them — vehicles for laundering billions in offshore Dubai-based holdings and funneling funds to help Iran evade sanctions — are reported to have knowingly operated on Emirati soil for over a decade.
Washington’s pivotal Gulf ally proved useful in the fallout of the Iran war. Emirati authorities finally cracked down on the cash pipeline to Tehran as the current and previous U.S. administrations had urged for years. The Emiratis also considered, for example, freezing Iranian assets and holdings earlier this year but failed to follow through. The United Arab Emirates acted to dismantle covert financing networks housed within its borders only when the threat had become imminent and real, and even then, the effort was incomplete.
This provides an analog for why the Emirates’ central role in the trade and concealment of Sudan’s conflict gold has continued uninterrupted for so long — a role that Abu Dhabi routinely denies.
The United States and partners in Europe continue to direct sanctions on Sudan’s conflict gold at its source of origin or the people and companies involved in the trade. These focal points are either easy to obscure or redirect in ways that have little discernable impact on the trade itself. The most fixed, identifiable entity in the chain is the physical location of the final refining process and clearing hub — the one point that no sanctioning body would dare target.
On 13 July, the Council of the European Union banned the purchase, import, and transfer of gold originating in Sudan along with the sale of the mercury and cyanide used to process it. The stated aim was to cut off a revenue stream that has helped sustain the civil conflict now entering its fourth year, which has spawned the world’s largest ongoing displacement crisis. Gold smuggling provides the financial backing for both parties to the conflict — the Rapid Support Forces and the Sudanese Armed Forces — which, according to United Nations reporting, generated over two billion dollars between them in a single year. This staggering sum is made possible by processing the metal from mine to polished bars through a series of concession companies before they reach the end buyer.
As is now well documented by a raft of investigations by SWISSAID, U.N. expert panels, the Sentry, the New York Times and independent journalists, the primary purchasers of smuggled gold are brokers based in the United Arab Emirates. The raw metal is mostly derived from artisanal mines in areas controlled by the Rapid Support Forces — the Emirates’ ally in the conflict fighting against the Saudi and Egyptian-backed Sudanese Armed Forces — and then passes by land through a series of militias and intermediaries until it reaches a major transit hub for air cargo to Dubai. Baked into this chain is the concealment process — by transiting to neighboring countries like Chad, Libya, or Egypt, with small-scale smelting factories involved along the way that fix the paperwork — where the soon-to-be outbound gold is registered as anything but of Sudanese origin. By the time it reaches the Gulf — and ultimately the global market — it is devoid of any markers that trace it back to the conflict. The gold is further refined in a final wash after it lands on Emirati soil, thereafter emerging as a clean product ready for legal sale.
The E.U. sanctions measures could easily be interpreted as little more than virtue signaling instead of effective action, and they arrive far too late. Taking a first step such as this is not necessarily pointless, as it can lay the groundwork for more robust measures in the future, and the case for it does have a basis. The Dubai gold market already carries reputational risk due to its association with the conflict in Sudan and broader illicit activities. If a critical mass of regulators, banks, and industries name and shame the Emirates’ role, doing business there becomes more precarious and expensive. But again, the bars shuffled through Dubai cannot by that late stage be proven to be of Sudanese origin. And realistically, there is a ready global market for discounted gold, unconcerned about whether it is tied to Sudan’s conflict or not.
Origin bans on conflict gold fail even in such a scenario due to the same structural reason that a decade of comparable measures has already demonstrated: Provenance is not difficult to obscure. Using a combination of false documentation, layered intermediaries, and mixing, Sudanese gold is stripped of its identity long before it reaches any market that any oversight body can regulate. An origin ban asks customs and compliance officers to screen for an attribute that has already been erased upstream.
U.S. Treasury Department sanctions on conflict gold operate differently by targeting the specific people and firms that mine and move it rather than the commodity itself. In January 2025, the U.S. Office of Foreign Assets Control designated Rapid Support Forces commander Mohamed Hamdan Dagalo and seven U.A.E.-based companies tied to his network. His firm purchased Sudanese gold and transported it to Dubai to holding companies and procurement shells built explicitly to obscure the process. The United Kingdom, also in July this year, followed a similar approach when it issued sanctions on Rapid Support Forces-linked procurement operatives and companies based in Dubai and Hong Kong, along with Sudanese state-owned mining companies. This approach is more effective in that it reaches into the machinery of the sourcing and laundering as opposed to the trade of the good that a blanket ban on provenance is certain to miss.
Yet even here — despite the well-meaning intent and some success in identifying the key people involved — the effect of the sanctions on halting the gold trade that fuels the conflict is weak. The machinery is diffuse by design, with business identities and functions easily reconstituted or rebranded before any sanctions entity can discover the change. Layers of shell companies obscure the players involved in the same way that trafficking modes cover up source origin of the commodity itself.
The most consequential cover, however, is the Emirati government. Following the U.S. designation, Abu Dhabi responded by asserting that the seven companies tied to Dagalo did not hold valid commercial licenses and were therefore not operating in the U.A.E. at all. Even if the country’s authorities had chosen to take some action to disrupt the pipeline, the broader network underlying its operations would just pick up the machinery that remained and establish even more layers of complexity that make tracing the operation a futile exercise.
Clearly there is little incentive for Emirati leaders to take such action, just as with the money changers funneling cash to the Islamic Revolutionary Guard Corps. On the contrary, U.A.E. involvement in Africa’s gold trade and the country in general reaps a two-fold reward of alliances and treasure. SWISSAID reported an estimated 29 tons of gold flowed directly from Sudan into the Emirates in 2024 alone — imported at a steep discount to its market value — feeding into the roughly 700 tons of African gold the country absorbs annually. This is a volume sizeable enough to erase any single country’s gold the moment it is refined. And the U.A.E.’s relationship with the Rapid Support Forces and networked militia groups furthers a host of geopolitical objectives. Its established presence on the Mediterranean in Libya’s eastern region now stretches comfortably to protect its interests through eastern and central Africa, with widespread and unhindered land and seaport access. And it gets to sustain a proxy conflict with Egypt and Saudi Arabia far from home soil. In exchange, Dagalo has built a seemingly untouchable empire for himself and his family, and the Rapid Support Forces get an uninterrupted flow of cash, Emirati-made armored personnel carriers, and Chinese-made defensive systems including precision munition drones to keep the war machine kicking.
It would seem that the obvious target for sanctions on Sudanese conflict gold would be the Emirati-based system that absorbs it and makes it sellable on the international market. But a designation aimed at a hub itself carries the same protection dynamic that defeats the measures already tried. The United Arab Emirates disputes the operating licenses of broker outfits, the network reestablishes the same infrastructure under new labels, and the smuggling process continues. In theory, if the network were completely dismantled and prevented from restructuring within Emirati borders, it could physically reconstitute in an alternative safe haven for illicit activity. But setting up new refineries tied to a market as central as the Emirates is a significantly more complex and time-consuming undertaking that would be easier to track than simply creating new shell companies within the same jurisdiction. Relocation would move the point of political failure, not provide a technical escape from it. But the obstacle is not that Sudan’s conflict gold cannot be reached, but that reaching it would mean publicly shaming a critical regional ally — in the middle of a war, no less.
The instrument that would require no cooperation from the Emirati authorities at all is the one with impact: pressure on the refiners’ access to foreign currency clearing and correspondent banking. The same lever was applied against the Iranian exchange houses in Dubai, in that case by the Emiratis themselves. But it also has limits because gold is easy to move and sell in other currencies and passed on to buyers unconcerned about the commodity’s ties to the Sudan conflict. Severing dollar or euro access would redirect at least a portion of the trade into other channels while still evading the bigger issue: the UAE is the laundering hub that turns a tainted product into a clean sellable good, and that conversion process runs through a banking system deeply with Western ones. Targeting it would risk disruption to that system, with spillover into the wider Gulf and global economies. This tool goes unused not because it would fail, but because it would work. The cost of implementation falls on a banking relationship bound up with Western finance that U.S., U.K., and E.U. governments are unwilling to damage.
Any combination of diplomatic pressure and sanctions regimes is unlikely to reach a threshold at which that calculation shifts. Graduated pressure changes behavior only when accumulated costs and associated risks outweigh the gain, and in this case, it does not come close — either for the Emirates or its Western allies. The smuggling of Sudanese conflict gold continues to thrive in that nebulous space between. Yet that space is held open by choice.
Three Western jurisdictions have issued sanctions on Sudan’s conflict gold in eighteen months, each reaching further, and each stopping pointedly short of directly confronting the Emirates as the pivot. In July, for the first time since the current conflict began in 2023, the European Parliament explicitly named the Emirates’ role as a sponsor of the Rapid Support Forces, a notable shift from the widespread status quo silence. But the body that actually writes binding law is the Council of the European Union, which adopted the gold ban without naming the United Arab Emirates at all.
These two moves point in opposite directions. The Council’s binding ban is aimed at the commodity — which as argued here, is likely to fail structurally — and risks being perceived as performative rather than substantive, whatever its legal force. Conversely, the Parliament’s naming binds no one, but confronts the Emirati patronage of the Rapid Support Forces directly. The taboo of naming the Emirates appears to be starting to break, albeit slowly. But still, naming only establishes an inactionable baseline for more effective action down the road. The political will to go a step further toward anything truly meaningful remains bound up in diplomatic ties, financial market stability, and realpolitik.
What the crackdown on the Iranian network operating in Dubai indicated is that the United Arab Emirates demonstrably can and will police illicit practices when it chooses — yet in that instance under only the most extreme of external stimuli. Inaction on Sudan’s illicit conflict gold trade cleared in the Emirates remains an easy political choice because it maintains Abu Dhabi’s objectives across North and East Africa as well as at home. And it knows that Western countries will only scratch at the edge for symbolic value as long as the war with Iran continues and its alliance is still disproportionately valued.
Amanda Kadlec is an independent consultant and doctoral candidate at King’s College London, a former Fulbright Fellow, a RAND analyst, and a U.N. sanctions investigator. She is a fellow with fp21 and can be found on Substack @commonears.
Image: dconvertini via Wikimedia Commons
