2011 Iranian embezzlement scandal

3,000 billion Toman embezzlement in Iran (also 2,800 billion embezzlement, approximately $2.6 billion USD) was a fraud involving the use of forged documents to obtain credit from at least seven Iranian state and private banks to purchase state-owned companies.^[1] The fraud reportedly extending over a four-year period, but became more serious "in the months before the scandal broke in September" 2011.^[1][2] According to Iranian newspapers, Iranian businessman Amir-Mansour Aria "masterminded" the scam, and as of late October 2001 at least 67 people have been interrogated and 31 of these have been arrested.^[1]

Mostafa Pour Mohammadi, the head of a judicial investigations unit, has called the case “the most unprecedented financial corruption case in the history” of Iran.^[3] The scandal has also been called "politically sensitive", involving Esfandiar Rahim Mashaei, a close aide to President Mahmoud Ahmadinejad, opposed by conservatives.^[2]

Background

According to Iranian government newspapers and TV channels, the fraud was planned within Seven state-owned and private banks, including Saderat Bank of Iran,^[4] and is the largest and most important fraud in Iran history.^[5] The fraud reportedly was first identified at Bank Melli, Iran’s largest commercial bank.^[1]

According to the New York Times and Washington Post newspapers, the embezzlement was a "scheme to use forged documents or letters of credit to acquire assets "including major state-owned companies" or "privatized government assets,"^[6] (such as the Khuzestan Steel Company, a major steel producer^[3]) at "one of Iran’s top financial institutions", Bank Saderat.^[2]

According to government media, the economy ministry tipped the intelligence authorities about suspicious loan applications in the banking system and the main culprits are now in police custody.^[7]

Iranian state prosecutor Gholam-Hossein Mohseni-Eje'i said 19 people have been arrested for being involved in a bank embezzlement scandal.^[8] The Washington Post reports 22 suspects "including businessmen and bank officials" have been arrested, and the chiefs of two banks have been dismissed. On 27 September, Mahomud-Reza Khavari, abruptly resigned as the managing director of Bank Melli, Iran’s largest commercial bank, and flew to Canada after the bank was implicated in the fraud. However, a spokesmen for the bank stated that Mr. Khavari had gone to Canada for "ordinary business reasons".^[6]

Response to scandal

Supreme Leader

3 October 2011, Supreme Leader Ayatollah Ali Khamenei, told viewers of Iranian state TV “People should know all these (responsible) will be pursued. ... God willing, the traitorous hands will be cut." The leader also stated the media should not use the case to “strike at officials.” ^[2]

Parliament

The speaker of the Iranian parliament Ali Larijani says all three branches of the government are determined to deal with the recent banking scam case.^[7][9] Ahmad Tavakkoli member of parliament said on Sunday (18 September 2011) that the embezzlement of 28 trillion rials (3,000 billion Toman) is an intolerable scandal, adding that if administration officials are not able to handle the affairs, they should step down. In addition, he said that a number of MPs have introduced a motion, which envisages the establishment of a special committee to pursue the embezzlement case.^[10]

Ahmadinejad

On 16 September 2011, Iranian President Mahmoud Ahmadinejad rejected the accusations against some of his administration officials.^[11] Conservative critics of Ahmadinejad have accused his close aide Esfandiar Rahim Mashaei (whom the conservatives strongly oppose) of having connections with Amir-Mansour Aria.^[2]

See also

• Banking in Iran
• Corruption in Iran

References

External links

Videos

• Recent embezzlement in Iran (PressTV 2011)