The Reserve Bank of India (RBI) has asked banks to increase monitoring of export finance deals after a scheme to exploit U.S. sanctions against Iran was discovered by investigators.  Sources say that a group of nine Iranians set up shell companies in India to tap into funds set aside from Iran's oil sales to Asian buyers--funds that can be used for limited purchases under U.S. sanctions law.  However, RBI's Enforcement Directorate found that no exports were made following the group's purchases.  Investigators uncovered up to $3.2 billion in fraudulent export advances paid out by state-owned UCO Bank in India.

Full story here (via Reuters).