Federal prosecutors also seized $6.9m in funds that had been traced to businessman Li Fangwei
The United States on Tuesday announced charges against a Chinese businessman accused of violating sanctions laws by using shell companies to access the US financial system and sanctioned eight of his firms for allegedly procuring missile parts for Tehran.
In a signal Washington would keep pressure on Iran over its nuclear program, the US State Department also offered up to $5m for information leading to businessman Li Fangwei's arrest or conviction.
Federal prosecutors also seized $6.9m in funds that had been traced to Li.
Separately, the US Treasury Department sanctioned a Dubai-based entity for providing support to others attempting to evade sanctions on Iran's oil sales.
Li has been the target of US sanctions in the past for his alleged role as a supplier to Iran's ballistic missile program.
In 2009, he was charged with selling restricted materials to Iran by the Manhattan District Attorney and Treasury banned him and his company, LIMMT, from conducting business in the United States without a license or authorization.
The latest actions further limit Li's ability to conduct business worldwide.
The State Department said the announcement of the reward for information leading to Li's arrest and/or conviction was coordinated with Treasury, the Commerce Department, which also added Li's companies to its national security list, and the Justice Department.
"These charges are an important part of the 'all tools' approach our government is taking against Li Fangwei to shut down and deny him the profit from his proliferation activities," John Carlin, who runs the Justice Department's National Security Division, said in a statement.
Described as a "known proliferator" and a "principal supplier" to Iran's ballistic missile program, Li has also been accused of trying to buy materials from the United States, China and other countries that could be used by Iran to produce or deliver weapons of mass destruction.
Prosecutors said he created front companies to conceal his efforts to run more than 165 US dollar transactions, worth around $8.5m, through US banks.
The US Attorney's Office in Manhattan seized $6.9m held in US banks in the name of foreign banks used by Li's companies, the Justice Department said.
Iran and a group of world powers reached a temporary agreement in November under which Tehran would get about $7bn in sanctions relief in return for steps to restrain its nuclear activities.
The agreement called for negotiation of a full agreement within a year, and Treasury said on Tuesday it was still pressing for a more definitive resolution.
"We will continue vigorously to enforce our sanctions, even as we explore the possibility of a comprehensive deal addressing Iran's nuclear program," Treasury Under Secretary David Cohen, who oversees sanctions policy, said in a statement.
A United Nations report in April said Iran had acted to cut its most sensitive nuclear stockpile by nearly 75 percent.
In March, a US official said Iran had pursued buying banned components for its nuclear and missile programs, even while it was striking the interim deal to limit its disputed nuclear program.
Vann Van Diepen, principal deputy assistant secretary of state for international security and non-proliferation, said Li had continued to supply such items despite US pressure on China to tighten export controls.
China has said it has fulfilled its obligations to UN resolutions about export controls.