Iran is secretly trying to set up banks in Muslim countries around the world, including Iraq and Malaysia, using dummy names and opaque ownership structures to skirt sanctions that have increasingly curtailed the Islamic republic's global banking activities, U.S. officials say according to the Washington Post.

The Treasury Department has blacklisted 16 Iranian banks for allegedly supporting Iran's nuclear program and terrorist activities; other countries have followed suit with their own measures. Tehran's search for new banking avenues is a sign of the growing effectiveness of the sanctions, U.S. officials said.

"The Iranians, we believe, are trying to set up operations in a number of places, and it's an indication that they can't do normal banking," a senior administration official said.

M. Bak Sahraei, a spokesman for the Iranian mission to the United Nations, said he could not immediately comment but would seek guidance from officials in Tehran.

In Iraq, an Iraqi official said, Tehran has established at least two banks in Baghdad, including one affiliated with Bank Melli, Iran's largest commercial bank. The U.N. Security Council listed Bank Melli in 2008 as being involved with Iran's nuclear activities, and the European Union has shut down all of its offices in Europe.

For years, the United Arab Emirates was an important conduit for Iranian goods and financial transactions. But since the latest U.N. Security Council sanctions were approved in June, the UAE has cracked down on Iranian activities, in part by curtailing financial dealings with Iranian banks blacklisted by Washington. In response, Iran appears to have tried to enlist Malaysia as a new financial hub, but without success, the U.S. official said.

Read more in the Washington Post.