The U.S. State Department said on Friday it was taking action to dismantle what it described as a sophisticated network that used deception and intermediary companies to obtain advanced equipment for Iran’s defense sector in violation of American sanctions.

According to State Department spokesperson Tommy Pigott, the network allegedly defrauded dozens of U.S. technology firms and secured millions of dollars’ worth of equipment, including spectrum analyzers and security detection devices with potential military applications.

U.S. officials said the operation relied on fraudulent websites designed to resemble legitimate American companies. The network allegedly used intermediaries in Dubai to receive shipments before transferring the equipment to Iran, circumventing existing sanctions restrictions.

The State Department identified Ali Majd Sepehr as the individual leading the network. Officials did not disclose the names of the affected American companies or provide details on the quantity of technology allegedly transferred.

The sanctions announcement comes as Washington increases efforts to disrupt financial and logistical channels linked to Iran’s military establishment. On Thursday, the State Department offered a reward of up to $15 million for information leading to the disruption of financial mechanisms associated with the Islamic Revolutionary Guard Corps and its affiliated branches.

The move also coincides with high-stakes diplomatic discussions between Washington and Tehran aimed at ending the conflict that began earlier this year. The White House said on Friday that President Donald Trump would approve an agreement only if it fully satisfies U.S. requirements, underscoring uncertainty surrounding the negotiations.

The latest sanctions signal that the United States intends to maintain economic and legal pressure on Iran’s defense procurement networks even as diplomatic efforts continue.

Speaking at a congressional hearing, Cao said foreign military sales to Taiwan had been put on hold while the Pentagon assessed weapons inventories needed for Operation Epic Fury, the U.S. campaign targeting Iran. He said the United States had sufficient stocks but was taking steps to ensure military requirements were fully met before resuming transfers.

“Right now we’re doing a pause in order to make sure we have the munitions we need for Epic Fury,” Cao said, adding that foreign military sales would continue once the administration determined it was appropriate.

The remarks mark the clearest public indication yet that the Iran conflict has affected the timing of U.S. weapons deliveries to Taiwan, which has sought to strengthen its defenses amid rising military pressure from China.

The U.S. State Department and the Pentagon did not immediately comment on Cao’s statement.
Taiwan’s Presidential Office pushed back against suggestions that approved sales were being altered. Presidential Office spokeswoman Karen Kuo said on Friday that Taipei had received no indication Washington intended to revise the arms package.

The reported delay centers on approximately $14 billion in weapons purchases sought by Taiwan, though U.S. officials have not detailed which systems could be affected by the pause.

The development comes as questions persist over President Donald Trump’s approach to Taiwan. While the United States formally recognizes Beijing rather than Taipei, U.S. law requires Washington to provide the self-governed island with defensive weapons.

China, which views Taiwan as part of its territory, has repeatedly opposed U.S. arms sales to the island. A Chinese Foreign Ministry spokesman said on Friday that Beijing’s opposition to such sales remained “consistent, clear and firm.”

Trump also signaled a potential shift in approach ahead of a recent visit to China, saying he would discuss Taiwan arms sales with Chinese President Xi Jinping. Previous U.S. administrations had maintained that decisions on arms transfers to Taiwan were a matter between Washington and Taipei and not subject to consultation with Beijing.

Following the trip, Trump said he had made no commitments to Xi regarding Taiwan and would decide on the proposed sales within a relatively short period.
The pause underscores the competing demands facing U.S. defense planners as Washington balances support for partners in the Indo-Pacific with military commitments stemming from the Iran conflict.

The inquiry by the State Department’s Office of Inspector General is focused on a $30 million grant awarded to the foundation in June 2025, the Financial Times reported.

The Gaza Humanitarian Foundation was created as an alternative aid distribution mechanism that largely bypassed United Nations-led humanitarian operations in the territory during the Gaza conflict.

According to the report, investigators are examining how the funding was sourced and spent, including procurement practices for food supplies and transportation services provided through private contractors.

Sources familiar with the matter told the Financial Times that the foundation paid significantly higher prices for food than previous U.S.-funded humanitarian programs in the region.

A spokesperson for the foundation denied knowledge of any investigation and defended the organization’s purchasing practices, saying most food was procured locally at reasonable prices. The spokesperson acknowledged, however, that transportation costs were unusually high because of the operational risks associated with active conflict zones.

The State Department’s Office of Inspector General declined to confirm or deny the existence of a formal investigation but said it had launched an audit earlier this year into U.S. food assistance efforts in Gaza and the occupied West Bank.

The foundation faced criticism soon after its launch in May 2025 over its opaque financing structure and its reliance on private military contractors at aid distribution sites.

Its executive director and deputy director resigned before operations officially began as international criticism mounted over Israel’s blockade of Gaza and worsening humanitarian conditions in the enclave.

The report said Gaza health authorities estimated that around 1,000 Palestinians were killed by Israeli fire while attempting to access aid near distribution centers operated by the foundation, while United Nations agencies warned that famine conditions were spreading across the territory.

According to the Financial Times, some U.S. officials privately questioned how the foundation operated after the Trump administration waived several audit and oversight requirements typically imposed on federally funded humanitarian organizations.

Democratic lawmakers also requested explanations from U.S. Secretary of State Marco Rubio regarding the approval process for the funding and the safeguards attached to the aid program.

The organization suspended operations in October 2025, citing funding shortages, despite claiming it had distributed more than 187 million meals in Gaza, a figure reportedly disputed by some Israeli officials.

Rubio, traveling with President Donald Trump during a visit to China, said Cuba’s deepening economic turmoil stemmed from structural failures and corruption rather than US sanctions, which Havana has long blamed for shortages and financial distress.“It’s a broken, nonfunctional economy, and it’s impossible to change it,” Rubio told Fox News aboard Air Force One.

“I don’t think we’re going to be able to change the trajectory of Cuba as long as these people are in charge in that regime.”Cuba has been grappling with severe economic disruption and energy shortages, with authorities reporting that around 65% of the island experienced electricity blackouts on Tuesday.

The US State Department publicly renewed the $100 million assistance proposal, saying the package would include humanitarian support and funding aimed at expanding “fast and free” Internet access across the island.

“The regime refuses to allow the United States to provide this assistance to the Cuban people,” the department said in a statement, adding that Cuban authorities would be accountable if they rejected “critical life-saving aid.”Washington last week imposed new sanctions targeting key entities within Cuba’s state-controlled economy and foreign partners linked to the sector.

Trump has recently intensified pressure on leftist governments in Latin America and has suggested Cuba could become a future target of broader US strategic efforts after the removal of Venezuelan leader Nicolas Maduro earlier this year.

Cuban authorities rejected Rubio’s characterization of the crisis and blamed US restrictions for worsening fuel shortages and economic instability.President Miguel Díaz-Canel said the worsening conditions were caused by what he described as a US “energy blockade,” accusing Washington of threatening countries supplying fuel to Cuba with punitive tariffs.

Foreign Minister Bruno Rodríguez Parrilla dismissed Rubio’s claims that Havana had rejected the aid proposal, calling the assertion “a lie” and questioning whether the offer was intended to undermine Cuban sovereignty.

Cuba has witnessed a series of small but increasingly visible protests in recent months as residents face prolonged blackouts, fuel shortages and rising economic hardship.

Witnesses told AFP that demonstrators in parts of Havana banged pots and pans and demanded electricity be restored following new power outages.Cuba’s fuel imports have sharply declined since the United States moved earlier this year against Venezuela’s leadership, reducing energy support from Caracas.

Since then, only one Russian oil tanker has reportedly reached the island.The Trump administration previously provided $6 million in humanitarian aid to Cuba through Catholic Church-linked charities, which have historically acted as intermediaries between Washington and Havana.

The cases involve Dawn Michelle Hunt, a 54-year-old former flight attendant and artist from the Chicago area, and Nelson Wells Jr., a 52-year-old Louisiana native and father of three, whose families say were unknowingly used as “blind mules” to transport narcotics hidden in luggage provided by other individuals.

The appeal places the cases at the intersection of humanitarian diplomacy and increasingly strained U.S.-China relations, as Washington and Beijing remain divided over trade, Taiwan and Iran-related tensions. For Trump, who has frequently highlighted efforts to secure the return of detained Americans abroad, the release of the two prisoners could offer a rare diplomatic breakthrough during a summit expected to yield limited concrete agreements.

Family members said they are attempting to deliver letters directly to Trump ahead of the meeting. Tim Hunt, Dawn Michelle Hunt’s brother, described his sister as highly intelligent and said she had been lured to China through what he characterized as a fraudulent “prize” trip.

According to her family, she was later given purses and a suitcase containing concealed narcotics that she unknowingly agreed to carry on an outbound flight.Wells’ family said he was detained after agreeing to transport another traveler’s suitcase while returning from a trip to China.

The individual allegedly disappeared after airport authorities discovered drugs hidden inside the bag.“I enjoyed serving my country,” Nelson Wells Sr., a U.S. Army veteran, said in remarks released through the family. “Now I just want my country to serve me.”A spokesperson for the U.S. State Department⁠ said Washington is providing consular assistance to both Americans and advocating for their health and welfare, while declining to comment further because of privacy considerations.

China’s foreign ministry said the two Americans were serving sentences for serious drug offenses and that Chinese authorities were handling the cases in accordance with the law while protecting their legitimate rights and health conditions.Advocates involved in the cases said U.S. officials have formally requested humanitarian releases from Chinese authorities, citing worsening medical conditions.

According to family members and advisers, Hunt requires blood transfusions and has declined surgery because of concerns over prison medical care, while Wells suffers from seizures, diabetes and high blood pressure.Beijing-based lawyer James Zimmerman, who is advising the families, said Chinese officials had privately indicated a willingness to consider humanitarian parole if the matter received higher-level political attention from Washington.

The cases follow a prisoner exchange in 2024 in which China and the United States each released three citizens that both governments said had been wrongfully detained after years of diplomatic negotiations.Peter Humphrey, a former prisoner in China who now advises families of foreign detainees, said U.S. embassy officials had increased engagement with Chinese authorities regarding the cases in recent months.

John Kamm, whose San Francisco-based Dui Hua Foundation researches political prisoners in China, said both Americans should be granted humanitarian parole because of their medical conditions. The foundation estimates that around 200 Americans are currently held in detention facilities across China.

The families said public attention to the cases intensified after testimony delivered at a September 2024 hearing of the Congressional-Executive Commission on China, where lawmakers examined the treatment of Americans imprisoned in China.Relatives are also backing legislation introduced by Representative Chris Smith that would expand support mechanisms for families of Americans detained overseas under disputed circumstances.

Tim Hunt said his father died in January before seeing his daughter released, while Wells’ family said his youngest daughter, now 12 and living in Japan, was only six months old when he was arrested.