Friday June 21, 2019
Time: 11 am
2201 C St. NW Washington D.C 20520
August 20, 2018 | Reuters Staff
WASHINGTON (Reuters) – Two Iranian men were indicted on Monday for allegedly spying for Tehran in the United States, including conducting surveillance at a Jewish facility and gathering information on backers of the militant Iranian opposition Mujahideen-e Khalq, the Justice Department said.
Ahmadreza Mohammadi-Doostdar, 38, a dual U.S.-Iranian citizen, and Majid Ghorbani, 59, an Iranian citizen and resident of California, were charged in the indictment with acting on behalf of Iran by conducting the surveillance, the Justice Department said in a statement. Both were arrested on Aug. 9.
The indictment alleges Doostdar traveled from Iran to the United States in July 2017 to collect intelligence about entities considered to be enemies of the Iranian government, including Israeli and Jewish interests as well as people associated with MEK, it said.
The Justice Department said Doostdar conducted surveillance in July 2017 of an ultraorthodox Jewish facility in Chicago, the Rohr Chabad House, including photographing the security features.
Ghorbani attended an MEK rally in New York on Sept. 20, 2017, to protest the current Iranian government, taking photographs of the participants, which he later passed on to Doostdar and was paid about $2,000.
The photos, many with handwritten notes about the participants, were found in Ghorbani’s luggage at a U.S. airport as he was returning to Iran in December 2017, the Justice Department said.
Ghorbani also attended an MEK-affiliated Iran Freedom Convention for Human Rights in Washington in May, where he again appeared to photograph speakers and attendees, the department said. He later spoke with Doostdar to discuss clandestine methods to deliver the information to Iran, it said.
Iran considers the Mujahideen-e Khalq to be a terrorist group that seeks the overthrow of the government in Tehran. The group was listed as a terrorist organization by the U.S. State Department until 2012.
Reporting by David Alexander; Editing by Richard Chang
Speech by Maryam Rajavi,
At the Resistance’s Grand Gathering in Paris – June 30, 2018
On Saturday, June 30, 2018, the Iranian Resistance’s grand gathering was held in Paris, France. Delegations from various countries including prominent politicians, members of parliaments, mayors, elected representatives, and international experts on Iran attended the event. The speakers declared their support for the Iranian people’s uprising and the democratic alternative, the National Council of Resistance of Iran. They called on the international community to adopt a firm policy against the mullahs’ religious fascist tyranny and stand by the arisen people of Iran. Below is the full text of her remarks.
My fellow compatriots,
Dear Friends,
Elected representatives, the honorable dignitaries from across the world
Greetings to all of you and to my dear compatriots in Iran and the world over. The first thing that must be said today is that flames of the auspicious and liberating uprising are again rising in Tehran and across Iran: Again, Mashhad and Shiraz, Bandar Abbas and Qeshm, Karaj and Kermanshah, Shahriar, Islamshahr, Kashan, Arak, Isfahan, Ram Hormuz, and many other towns and cities.
Indeed, the uprising cannot be extinguished and will continue without respite, constantly expanding and deepening.
The roar in the cities and of rebellious youths are the heartbeats of the Iranian nation in the euphoria over a free Iran.
The thunderous cities and the rebellious youths are the heartbeats of the Iranian nation in the euphoria for a free Iran.
Hail to my fellow compatriots in Khorramshahr who are thirsting for water and for freedom. You, who explicitly told the mullahs that their prayers are not acceptable to God.
I have come here on behalf of a Resistance movement which has offered its entire existence to ensure the victory of the Iran uprising, and for Iran’s freedom, pride, and magnificence.
To the arisen people of Iran,
I have come here to declare what you want: The overthrow of this regime is inevitable. Victory is certain and Iran will be free.
And we salute the Mojahedin in Ashraf 3, their home. Congratulations for constructing it with your own hands.
And onwards toward 1,000 Ashrafs (resistance units) in our occupied homeland.
The leverage for the overthrow
Since the January uprising, the signs of change in Iran and the regime’s overthrow have appeared. The prospects for the victory of Iran’s democratic revolution, devoid of the mullahs and the Shah are looming. Through their uprisings and by relying on resistance units, the Iranian people have the leverage they need to topple this regime.
How and where can we see these realities?
First, owing to the presence of the Resistance movement, the so-called solution within the religious fascism has become null and void.
The rebellious population and youth have ended the era of posturing for both factions of the regime. These are the very fearless youth who have chosen the path to fight on and to go on maximum offense no matter what the cost.
The continuation of the uprising and the protest movement despite maximum suppression
The second sign that the phase of the regime’s overthrow has arrived is that for the past six months the Iranian people have waged an uprising and a protest movement despite maximum suppression, despite the so-called suicides by the detainees in the mullahs’ prisons and despite daily arrests and executions designed to intimidate the public.
The workers at Haft-Tapeh sugar cane factory resumed their uprising. Then, the workers at Ahvaz steel factory, and farmers in Isfahan rose up. Friday prayer worshipers in Isfahan turned their backs on Khamenei’s Friday prayer leader and roared “back to the enemy and facing the nation.”
Isfahan Province was still simmering when our Arab compatriots in Khuzestan, especially in Ahvaz, rose up. Then came Kurdistan as the lengthy strike in Baneh aroused everyone’s admiration. Then, in the roadmap to overthrow, a new role model emerged: Kazerun, the city of uprising, fire and blood, with daring women, who with their brothers, rocks in hand, overran the heavily-armed enemy forces, imitating the resistance we saw at Camp Ashraf.
It was there when the uprising accelerated. The strike by toiling truck drivers and owners in 285 cities and in 31 provinces shook the regime to its foundation for 12 days.
Teachers, the retirees, the swindled, and workers of hundreds of production centers rose up day after day. And last week, the Tehran bazaar rose up and ignited the uprising in Tehran and other cities.
Iran rose up again, with all its children, with all its nationalities and ethnicities.
Truly, where is the destination? A free Iran, by eradicating dictatorship and plunder, and by bringing down Khamenei from his seat.
An explosive and irreversible situation
The third sign of the inevitable overthrow of the ruling religious fascism is that social tensions and economic crises, especially high prices, unemployment, poverty, and inequality have reached an irreversible point. Everyone senses the explosive state of society. And the mullahs can offer neither a solution nor are willing or able to resolve the problems.
The velayat-e faqih lacks any legitimacy. Khamenei’s standing has plummeted dramatically. The regime has run out of cash. The Revolutionary Guards and the unpopular Bassij forces have been hit with defections. The moderation masquerade to preserve the regime has been unmasked. And the regime in its entirety is drowning in the abyss of internal feuding.
And now, it is the regime’s advocates who are admitting the existence of two warring governments at the top of the ruling establishment. One of them openly said, “We are getting close to purge one of the two governments, either the hidden government will take full control of governance, or will be forced to relinquish parts of its authority.”
The collapse of appeasement policy
The fourth sign of the phase of the regime’s overthrow is that internationally, the mullahs have lost the most important backer of the policy of appeasement, namely the United States. The international shield safeguarding the regime has fallen by the way side. The mullahs have practically lost their JCPOA. The avalanche of successive sanctions is hitting them hard, undercutting their ability to engage in warmongering and adventurism in the region. An arms and oil embargo, demanded by the Iranian Resistance since four decades ago, is in the process of being implemented. And the era of labelling, bombing and suppressing the opposition at the behest of the regime has come to an end.
The blood of martyrs and suffering of those detained fuel the fire of the uprisings
The fifth and most important signal of the phase of the mullahs’ overthrow is that the very development which the mullahs feared the most has happened: the linkage between the fury of the deprived and oppressed and the organized Resistance movement. All regime leaders have repeatedly acknowledged this fact. And in this way, they are admitting that the regime’s end is coming.
Indeed, the regime’s overthrow is coming.
In 2013, following the massacre of 52 Mojahedin members at Camp Ashraf, when several others were taken hostage, Massoud Rajavi announced the roadmap for creating 1,000 Ashrafs (resistance units) inside Iran so that the organization which leads the uprising could be linked with the arisen people of Iran. Accordingly, units and councils for the national resistance became the tip of the spear of the strategy for uprising and overthrow in Iran’s risen and rebellious cities. This is how the blood of the martyrs and the suffering of those detained since June 20, 1981 until today, are fueling the uprisings. As Massoud Rajavi said, “If Iran stands, the world will stand with us and by our side.”
A passionate generation thirsty for freedom has risen. Those taking part in the uprising joined by resistance units have opened a new path. Rise up and walk along this path. Join hands with them and respond to their call for a free Iran. And say you are ready.
You saw that the people of Varzaneh took over the city’s entry points. Kazerunis took over the streets, and truck drivers and owners took over the highways. And you saw how the young people in Tehran, in Lalehzar, Ferdowsi, Shoush, Mellat and Ekbatan exhibited enormous courage in confronting the ruthless security agents and built entrenchments in the streets.
This is the Iranian nation’s fight to take over the entire country and take back Iran from the occupiers, the mullahs.
The overthrow of this regime requires resistance units and a liberation army
The campaign to create phony alternatives has become prevalent these days. And this too is another sign of the phase of the regime’s overthrow. But the crux of the matter is how they are going to actually bring down this regime. This is especially the case because the blood of the martyrs has permanently blocked the path to reform within the clerical regime and the return of the monarchy.
Now, if one can topple this regime without an organization and leadership, without passing through the test of time and sacrifice, without paying any price, and without any sacrifice, we say, please, go ahead and don’t delay.
If one can restore the people’s sovereignty without a history of fighting against two regimes, without drawing the lines with dictatorship and dependency, without a nationwide resistance and the galaxy of its martyrs, without challenging the principle of the velayat-e faqih and fake moderates, we say go ahead and don’t delay.
If one can topple the mullahs without challenging Khomeini over the unpatriotic Iran-Iraq war, ending the inferno of that war, and discrediting the motto of “liberating Qods via Karbala”; without compelling Khomeini to accept the ceasefire by launching 100 military operations by the National Liberation Army of Iran, which captured the city of Mehran and marched to the gates of Kermanshah; and without exposing the regime’s nuclear weapons, missile, chemical and microbiological programs and facilities, yes, go ahead and don’t delay.
If without exposing the regime’s human rights abuses and crimes in 64 UN resolutions, without the campaign for justice for the massacre of political prisoners in 1988, without the campaign by the supporters of the resistance worldwide and insisting on the rights of the Iranian nation for four decades, without the specific platform and programs of the NCRI and the Provisional Government for the transition of sovereignty to the Iranian people, and finally without a tested leader, who has guided this ferocious struggle for five decades, one can leap frog this fifty-year path in one night and create real change, while dreaming about foreign support, we say go ahead, the ball is in your court.
But let me say, such a fantasy is only possible with an Iraq-like occupation, meaning through a foreign intervention. Such a scenario already has a foregone conclusion.
In these 40 years, all the claimants who were unwilling to pay the price tested their chances. But the realities and experience have shown that this dark and evil regime will neither be reformed, nor turn “green” or “velvet.”
The overthrow of this regime inevitably requires the willingness to pay the price, requires honesty and sacrifice; requires an organization and a strong political alternative, and requires resistance units and a liberation army.
Nevertheless, as Massoud Rajavi said when appraising the January uprising, “We are not rivals to anyone seeking to assume power. And most certainly, no one can rival the MEK when it comes to honesty, sacrifice and paying the price.”
National Solidarity Front to overthrow the religious dictatorship
16 years ago, the Iranian Resistance adopted the plan on the National Solidarity Front for the Overthrow of the Ruling Religious Dictatorship and declared that it was prepared to cooperate will all forces who want a republican form of government, who are committed to the complete rejection of the velayat-e faqih regime and who struggle for a democratic, independent Iran, based on separation of religion and state.
In the past four decades, the NCRI, beyond typical political rhetoric, has paid a heavy price in blood and treasure for each and every one of its declarations, ratifications and commitments.
We call for the establishment of a society, based on freedom, democracy, and equality, which has clear demarcations with despotism and dependence as well as gender, ethnic and class discrimination. We have defended and will defend gender equality, the right to freely choose one attire, separation of religion and state, autonomy of nationalities, equal political and social rights for all citizens of Iran, abolition of death penalty, freedom of expression, parties, the media, assembly, unions, associations, councils and syndicates.
The NCRI’s 12-point plan for the autonomy of the Iranian Kurdistan, adopted and announced 35 years ago, continues to be one of the most comprehensive global examples addressing the rights of nationalities. A free and non-nuclear Iran will promote peaceful coexistence with its neighbors, and welcomes regional and international cooperation.
This is the visage of the democratic alternative which rejects the mullahs’ rule or any form of dictatorship.
In this path, the first step is to transfer sovereignty to the people of Iran. By relying on the Iranian people and a popular base one can avert chaos and insecurity and safeguard the integrity of Iran and Iranians, rendering it a proud nation.
According to the NCRI’s program, following the regime’s overthrow, a provisional six-month government will be formed, whose primary task is to form a constituent assembly through free elections with the general, direct, equal and secret ballot. This constituent assembly must draft the constitution of the new republic within two years and put it to vote. It must also set up the principal institutions of the new republic based on the people’s vote.
The violated sovereignty of the Iranian people must be revived
We believe it is possible to eradicate high prices, poverty, unemployment, shanty dwelling, water shortage and environmental calamities. But, before anything else, the trampled political rights, specifically the right to sovereignty of the Iranian people, must be restored and revived. This is the aim of our Resistance and the raison d’etre for the NCRI.
But the Iranian regime has benefitted the most by denying the wherewithal enjoyed by this Resistance and this alternative and by using western appeasers to suppress this movement.
Therefore, as far as Iran in concerned, without recognizing the Resistance and the right to resist, the damages the policy of appeasement has inflicted on the Iranian people cannot be rectified.
As we have always stated, and I repeat, the task of overthrowing the regime, bringing about democratic change and establishing a free Iran rests on our shoulders and those of the Iranian people. At the same time, we welcome any retreat by the mullahs. Because one thousand chalices of poison serve the interests of 1,000 Ashrafs, or resistance units.
Today, the brave children of Iran are completely immersed with the task of uprisings. I hail the courageous women of Iran, who are leading the way everywhere. I also hail the young people and members of resistance units, who even in captivity underscore their PMOI identity, which terrifies the regime.
Giving it all to advance the uprising
I call on you to give practical support to the uprisings. All Iranians, wherever they are, can help and advance the uprising. Also, you, the Iranian youth, who are present here, can do a lot. This is our commitment and our pledge to the Iranian nation to put everything in the service of the uprisings, give it all and sacrifice at all fronts to advance the uprising.
Literally, every moment and every second with the uprising, and every one for the uprising.
I hail all the martyrs and the defiant prisoners from June 20, 1981, until today. I hail those eternal flames of love, Sediqeh Mojaveri and Neda Hassani, on the 15th anniversary of their martyrdom. May their memories and names last forever!
I am well aware that your unsparing emotions is directed at the galaxy of the martyrs of the Resistance and the Iranian people’s liberation army as well as those in the uprisings, the resistance units and the steadfast prisoners and especially those massacred in 1988 in the regime’s prisons 30 years ago.
From the depth of the dark night
A Rose blossoms
Winter will no doubt pass
The harbinger of spring with thousands of roses will certainly follow
Hail to freedom
Hail to the people of Iran
Hail to all of you.
Did an elderly Korean-American salmon exporter become a money launderer for Iran?
By ZACH DORFMAN July 14, 2017
POLITICO – In August 2012, a silver Rolls-Royce pulled up to the majestic Broadmoor Hotel in Colorado Springs, Colorado. Out stepped a newly married couple, freshly arrived from their wedding ceremony. At the lavish reception, the bride and groom performed an intricately choreographed dance for the assembled guests, and cut the first piece of a formidable, multi-layered white wedding cake. They celebrated with family and friends. The bride wore a dazzling sapphire pendant around her neck, matching sapphire earrings and a weighty diamond ring around her finger. At the wedding dinner, a man toasted the groom, Mitchell Zong, as the kind of person who “really bends over backwards to help friends and family.”
Less than two years later, when FBI agents, executing a search warrant, entered the Zong family’s Southern California home, they took that same sapphire wedding set, valued at more than $40,000, as well as $24,000 in cash. Federal prosecutors had initiated a huge civil forfeiture case over property owned by the Zong family, including Mitchell Zong.
Prosecutors claim that what the FBI seized that day represents a fraction of the ill-gotten funds that tie Mitchell Zong to a spectacular transnational sanctions-evasion scheme, one that laundered more than $1 billion in Iranian government funds over a mere six-month period in 2011.
And the unlikely figure at the center of this story—which encompasses shadowy Iranian businessmen based in the Middle East and Caucasus; high-ranking South Korean state banking officials; an Iranian-American airline magnate whose planes have been linked to covert work for the U.S. government, including the CIA; the difficult politics of multilateral sanctions; the abstruse world of illicit finance; and laundered property and goods spread across three U.S. states—is a septuagenarian Alaskan ex-salmon exporter and restaurateur, Mitchell’s father, Kenneth Keun Zong.
Zong’s bizarre tale, reconstructed here through court documents and other sources, is no idle caper: As the Trump administration takes an increasingly aggressive posture toward Iran—by some accounts, it is even flirting with an official policy of regime change—it might soon seek to enlist the cooperation of allies and partners like South Korea in isolating Tehran. If so, imposing new multilateral sanctions might become a key objective for the Trump administration.
Mitchell Zong and his wife lost their sapphire wedding set as part of a massive civil forfeiture case related to his father’s alleged activities. | Obtained by Zach Dorfman
But the Zong case shows just how fraught this process can be, even when the international community is relatively united, as it was regarding Iran’s nuclear program during the Obama years. Even then, a single U.S. citizen, allegedly aided by bankers and government officials of one of America’s closest allies, was able to puncture the sanctions regime with unsettling ease. How will the Trump’s team, lacking even this modicum of international cooperation and goodwill, be able to cut off Iran from the global financial system? And what will happen if Trump’s team pushes strenuously against political currents to isolate Iran, only to find itself roundly ignored, not just by America’s great-power rivals, but also by its friends? To understand that, we need to understand how, for a time, Ken Zong outsmarted just about everybody.
***
Ken Zong seemed, at first glance, like a typical immigrant success story. He immigrated to Alaska in 1980, according to an affidavit from the civil forfeiture case. He became a U.S. citizen in 1985, raising his four boys in the Anchorage area. Zong quickly established himself within Anchorage’s small but growing Korean community; by 1991, he was identified by the Anchorage Dispatch News as a “community leader” and the head of the local Korean Chamber of Commerce. He played golf avidly. Mitchell was lionized in local papers for his prowess at football.
As a businessman, Zong was restless—some might say opportunistic—but by all accounts operated perfectly lawful businesses. According to reports in the Alaska Dispatch News, at different points he worked in real estate; owned a construction business; and ran a local diner that he converted (ultimately unsuccessfully) into an Italian restaurant. In 2004, according to the Juneau Empire, he worked with an Alaska state senator to export millions of cans of salmon to South Korea, where they were slated for use by the South Korean military and school lunches.
Zong moved back to South Korea, at least part-time, around 2001, court documents say. It is unclear what precipitated the decision. Records show that Zong has been sued in Alaska a number of times for unpaid debts, and Jim Spertus, Mitchell Zong’s lawyer, told me Ken Zong had been “in and out of bankruptcy.” The overall picture of Zong that emerges during these years is of a restless entrepreneur (one, perhaps, with a propensity for cutting corners) but certainly not an international criminal mastermind. By 2009, however—the year Zong registered the company KSI Ejder (later known as KSI/Anchore) in South Korea—there were signs that he was connected to something big.
The very same year that Zong founded KSI Ejder, in fact, a serial swindler named Sencer Sevket, a Turkish-Cypriot with British citizenship, was arrested in the U.K. and accused of cheating a British film company out of a £1.5 million investment. When police searched Sevket’s home, they found €40 million worth of promissory notes. According to the City of London police, at the time, Sevket claimed to be representing the “South Korean company KSI Ejder Korea Inc.” In 2013, Sevket received a seven-year sentence for fraud in a U.K. court.
Sevket had a long record of malfeasance. According to a 2010 story by the investigative finance journalist David Marchant, Sevket opened a mutual fund in the Cayman Islands in 2007 named “Ejder Investment.” Around that time, Sevket was still wanted by U.S. authorities for his alleged role in an early 2000s investment-fraud scheme. As Marchant notes, until 2010 Sevket referred to himself online as the director of KSI Edjer Korea; he was also the domain name registrant for the company’s website. During this period, Sevket’s name was associated with a dizzying number of shell companies with names containing some permutation of the phrase “Edjer” or “Ejder.” One of these companies, Ejder Plc, formed in 2006, listed Kenneth Keun Zong, “a 71-year-old resident of Seoul, South Korea,” as a company director on its corporate registry.
***
The wire transfers, all sent from Zong in South Korea, began as a trickle, court documents show: $30,000 to Canada, €50,000 to France, €149,000 to Italy, €116,000 to Germany. But there were dozens just like them over a few days in February 2011, and they kept getting larger. Within a week, the first recorded transfer to the United Arab Emirates—of $3.5 million—was posted, and many of the transfers thereafter were deposited into accounts based in that Gulf country. And the sums became increasingly eye-popping: On one day in May, for instance, there were $88 million in transfers; a week later, the one-day amount totaled more than $109 million.
Zong’s business was humming. His company, KSI Edjer/Anchore, had apparently secured a lucrative contract shipping marble to Farsoodeh and Company, an Iranian firm involved in mosque construction, via a Dubai-based tile importer, Orchidea Gulf Trading Co. The transfers were, in theory, related to Zong’s profits from his marble business.
There was just one problem: Orchidea wasn’t importing any marble to the U.A.E. Nor was it shipping any to Iran. Nor was Zong’s Seoul-based firm (which was just a shell company) fulfilling any real role as intermediary, besides submitting falsely marked-up documentation to Korean authorities detailing these completely fictitious transactions.
In reality, according to the sworn affidavit of the U.S. special agent charged with investigating Zong in the civil forfeiture case, as well as Kenneth Zong’s subsequent criminal indictment, Zong and his partners—Houshang Hosseinpour, Pourya Nayebi and Houshang Farsoudeh, three Iranian businessmen with tentacular connections across the Middle East and Europe—made up the entire arrangement. The court documents also claim that Hosseinpour, Nayebi and Farsoudeh ultimately controlled the accounts into which Zong transferred hundreds of millions of dollars. And moreover, the documents allege, the three Iranians were not operating primarily for their own personal enrichment, but in the service of the government of Iran, helping it circumvent the nuclear sanctions then choking off the Islamic Republic’s ability to make international purchases.
The origins of this partnership are opaque. Court documents say Ken Zong was connected to the three Iranians through his son Mitchell, who prosecutors say went to college with Houshang Farsoudeh’s brother at Colorado State University in the late 1990s. But Spertus, Mitchell’s lawyer, claimed to me that Mitchell has never met Farsoudeh’s brother, and that there is no record of him attending CSU. (Citing university policy, CSU declined to say whether Farsoudeh’s brother ever attended the school.)
This alleged scheme, as detailed in the court docs, could succeed only because of an unusual arrangement between Iran and South Korea. South Korea is a major importer of Iranian oil, and has a strong business lobby invested in bilateral ties. So while the U.S. still pressured South Korea to decrease its business with Iran, it gave Korea a limited dispensation to continue importing oil from the Islamic Republic.
As part of this arrangement, the Iranian Central Bank was permitted to open a special account at the state-owned Industrial Bank of Korea (IBK). This account, which was held in Korean won (in 2010, the U.S. forbid business with Iran from being conducted in dollars), allowed South Korean companies to pay Iran. But these oil funds were forbidden from leaving the IBK account unless they satisfied a number of strict conditions regarding their usage, and all transfers had to be approved by Korean authorities.
IBK had been eager to do business with Iran for years. According to State Department cables released by WikiLeaks, U.S. officials received intelligence in June 2008 that the bank was in talks with the Iranians to open up an account to facilitate oil payments; Seoul-based U.S. diplomats, alarmed at the consequences for nonproliferation and terrorist financing, met with high-ranking Korean officials, and succeeded in temporarily stymying the arrangement.
Iran, desperate for foreign currency, needed a way to get those restricted funds out of its IBK account, and, even better, to exchange Korean won for U.S. dollars. This made a middleman like Zong, who could facilitate these transactions from within Korea, a valuable resource.
But there was no way such huge sums of money could be moved that quickly without attracting the attention of South Korean authorities and bankers. So, according to Zong himself, whose seized emails were reprinted in U.S. court documents alleging his illicit conduct, he and his Iranian partners simply bought officials off.
passport photos, from left: Pourya Nayeli, Houshang Farsoudeh and Houshang Hosseinpou
If Zong’s emails are to be believed, his plan was an audacious one. In a March 2011 email to the Iranians, he claims that IBK was only one of a number of Korean institutions involved. Woori Bank, another state-owned Korean financial institution, was also aware of these improprieties, Zong contends, as was the Bank of Korea, the country’s central bank. So was KOSTI, the Korean government’s export control authority, the watchdog agency tasked with ensuring compliance with the recent U.N. sanctions against Iran. All these institutions “know well our transactions are based on fabricated & fake documents,” writes Zong, who fretted over “the great dangerous risk” to him and the authorities with whom he worked, who were “cooperating to do transaction[s] … without proper investigation.” (None of the governmental or financial institutions mentioned by Zong has been accused of criminal wrongdoing in South Korea or the United States; Woori and the Bank of Korea could not be reached for comment by press time.)
This purported kickback scheme continued through the year. Later in 2011, after a night of revelry at a “Korean-style Geisha house,” Zong sent an email to Hosseinpour, updating him on the status of the arrangement. “[I got] completely drunk with [the] IBK people last night,” he writes, going on to name a number of top bank officials. Zong later explains to the Iranians that he is waiting “for [the] instruction of IBK main office” to tell him which “branch and manager” to open up an account with. The manager, Zong writes, needs to be a “good soldier” of IBK brass.
By 2012, however, it seems that the arrangement had become untenable for the allegedly compromised Korean bankers. In another email to Hosseinpour, Zong writes that IBK officials told him that they “need to be quite [sic] for a while.” Zong then suggests that he move to Hong Kong or Shanghai to “open up a new company” and replicate the success of the earlier scheme.
But the walls were closing in. In September 2012, the JoongAng Daily reported that Korean authorities were investigating an Iran-related fraud case of astounding scale. According to this report, the investigation was set off when Zong, who went unnamed in the Korean newspaper’s story, improperly transferred $20 million into an American bank account. In 2013, Zong was sentenced by a Korean court to a two-year prison term on money-laundering related charges; in 2015 he was handed a five-year term for failing to pay taxes on the money involved in the first prosecution. In May 2017, Zong lost his appeal to a Seoul superior court, and was ordered to serve a roughly four-year sentence, plus endure 400 days in a forced-work camp if he failed to pay millions in fines levied by the court. (IBK was investigated and later cleared of any criminal wrongdoing by Korea officials, according to South Korean press reports; the bank was, however, subject to financial penalty imposed by the Korean government for improprieties related to the case.)
Over the course of his partnership with the three Iranians, Zong allegedly deposited $10 million in kickbacks into U.S.-based accounts alone. According to U.S. court documents, his total earnings may have topped $17 million. And then, according to filings in the civil forfeiture case, Zong’s family members—especially Mitchell—either knowingly or unknowingly helped launder the funds. (Spertus, Mitchell Zong’s lawyer, says Mitchell had no idea about the source of the funds his father transferred to him, and correctly notes that his client has not been charged with any crimes.) They used the Iranian money to buy $4 million worth of condominiums in Anchorage and homes in Colorado Springs, Colorado, and Eugene, Oregon. They used it to purchase multiple luxury cars and a stake in a million-dollar yacht berthed in tony Newport Beach, California. And they used it to buy that sapphire jewelry, the kind that one saves for a special occasion, like a wedding. Almost all of it has been seized.
***
In December 2016, U.S. prosecutors from the District of Alaska handed down a 47-count indictment for Kenneth Zong on money-laundering and sanctions-violations charges. If, upon the completion of his South Korean jail term, Zong is extradited to the U.S—which could take months, or even years, Steve Sckrocki, the lead U.S. attorney on the case, told me—he might face decades in U.S. prison.
But it is unclear if Korea will extradite him. According to Rich Curtner, Zong’s public defender in Alaska, Korean law forbids an individual indebted to the government from leaving the country, and recent Korean court documents state that Zong owes roughly $13 million to Korean authorities. (The case is “an enigma wrapped in a mystery,” said Curtner.)
But while Zong languishes in a South Korea prison, the three Iranian businessmen with whom he worked are apparently still freely conducting their business worldwide. While the true extent of their holdings is unknown, what is clear is that Nayebi, Hosseinpour and Farsoudeh’s “business” in South Korea was just one, perhaps small, component of a far-flung business empire. In fact, emails seized by U.S. investigators, and reprinted in the civil forfeiture complaint, purportedly show that their work with Zong was just one of many similar initiatives they conducted on behalf of the Iranian government.
While Zong languishes in a South Korea prison, the three Iranian businessmen with whom he worked are apparently still freely conducting their business worldwide.
According to Emanuele Ottolenghi, an illicit finance expert and senior fellow at the Foundation for the Defense of Democracies, the three men went on an “investing spree” in Georgia during this same period. As Ottolenghi, who has documented the three men’s activities in that Caucasian nation, wrote in a 2015 article, this included “launching the private airline Fly Georgia, trying (unsuccessfully) to buy Tbilisi’s Sheraton Metechi Palace hotel, and creating local companies involved in real estate, investment, holiday packages for Iranian tourists, aviation services, microfinance, currency trade, and prepaid credit cards.”
The attempted purchase of the Sheraton hotel in Georgia deserves special scrutiny, because it shows just how entangled the three Iranians became in a number of large-scale, complex international business deals—deals that eventually piqued the interest of U.S. investigators. At the time, the Sheraton was owned by the government of Ras al-Khaimah, one of the seven sheikdoms of the United Arab Emirates, which had a number of commercial interests in Georgia. According to Farhad Azima, a prominent Kansas City-based Iranian-American businessman and private airline owner, representatives of Ras al-Khaimah, eager to sell the property, reached out to him to help find buyers for the hotel. It was then that Nayebi, Hosseinpour and Farsoudeh appeared on the scene. Azima, who provided written responses to queries about his involvement in the deal, casts their involvement as almost serendipitous. The government of Ras al-Khaimah, he said, “requested that [he] find a buyer for the Sheraton hotel in Georgia,” and the three Iranians subsequently “presented themselves as potential buyers.”
The full extent of Azima’s connections to Nayebi, Hosseinpour and Farsoudeh has never been made clear. But recent U.S. and U.K. court documents, as well as Azima’s own emails—Azima and Ras al-Khaimah are currently locked in a series of bitter lawsuits in both countries, with Azima’s lawyers claiming that Azima’s emails were hacked and subsequently leaked online by the sheikhdom’s agents—suggest the relationship was far more intimate than previously reported.
According to Azima’s lawyers’ filings in these cases, Azima not only introduced Nayebi, Hosseinpour and Farsoudeh to the ruler of Ras al-Khaimah, he hosted Hosseinpour and Farsoudeh at an in-person meeting with the emir at his palace in October 2011—just a few months after the Iranians wound up their billion-dollar money-laundering scheme with Kenneth Zong—to work out the purchase of the hotel. (There is no indication that Azima was aware of any of the three Iranians’ alleged activities in South Korea or elsewhere.) According to Azima’s legal brief, the emir was eager to complete the deal because the Iranians were, for reasons that go unexplained, willing to pay “above market price” for the hotel.
The Iranians’ $62.5 million bid for the Sheraton was, in the end, unsuccessful. This may have been due to the murkiness of their finances, which was of clear concern to the law firm in Georgia overseeing the deal. “Where did you find these people?,” writes a lawyer for the firm to Azima, in a leaked email. “Lost and Found Department!,” replies Azima, cryptically.
In a written response to questions about the hotel deal, Azima noted that the three Iranians had passed “anti-money laundering checks and ‘know-your-client’ guidelines” conducted by the lawyers in Georgia. Even so, he wrote, he “sought the input of the U.S. State Department regarding the buyers … and was advised I should not deal with them. Based on that advice, I withdrew from the Sheraton Hotel transaction.” (He also noted that Ras al-Khaimah continued to deal with the three Iranians, eventually accepting, and keeping, $20 million from the buyers, even though the deal fell through.)
Successful or not, the activities of the three Iranians in Georgia started raising eyebrows. In June 2013, in an interview with the Wall Street Journal, both Nayebi and Hosseinpour denied working for the Iranian government. “We hate them,” Nayebi told the Journal. “We have nothing to do with evading sanctions,” said Hosseinpour.
But U.S. Treasury Department officials—who, according to the Journal, travelled to Georgia repeatedly in 2012 to investigate the influx of Iranian capital there—evidently disagreed. In September 2014, the three men were placed on the Treasury Department’s official list of sanctioned individuals, as were many of their businesses, including the Dubai-based front company Orchidea. Treasury officials accused the three men of “facilitat[ing] deceptive transactions” on behalf of multiple previously sanctioned Iranian financial institutions.
At this point, at least one of the three Iranians seems to have reached out to Azima for help. Azima’s leaked emails show that, in late 2014, he referred Hosseinpour to his own lawyer in order to potentially lobby the Treasury Department to remove Hosseinpour from a list of sanctions evaders. According to Azima, Hosseinpour asked him for the recommendation; he also says that Hosseinpour ultimately declined to retain the lawyer.
It’s not clear what specific alleged activities led to the Treasury decision. Nor is it clear who within the Iranian regime the U.S. believed the three men worked for. But there are some potential clues in the public record.
One is from a Cayman Islands-based newspaper, which, while reporting on a citizenship-for-investment program in Saint Kitts and Nevis—the three Iranians bought their way into citizenship, and thus another set of passports, to the tune of $250,000 per person—connected Nayebi to the Execution of Imam Khomeini’s Order (EIKO), a massive conglomeration of business interests controlled directly by Iran’s Supreme Leader. EIKO forms a key part of his power base and patronage network—a 2013 Reuters investigation estimated that EIKO’s holdings were valued at around $95 billion.
I found another. The billing address the Iranians provided for Farsoodeh and Co.—the Iranian company to which Zong “sold” roughly $1 billion in tiles—appeared on EU sanctions lists in 2014 as the headquarters of Sorinet Commercial Trust Bankers. At the time, Sorinet was recognized by the Treasury Department as a front organization of Babak Zanjani, one of Iran’s richest men, who helped the Iranian government illegally amass billions. Treasury had already announced sanctions against Zanjani and his companies, claiming that Sorinet was a front for Iranian state oil companies, some of which were themselves owned or operated by the Revolutionary Guard. Zanjani’s fortunes have since soured; in 2016, he was sentenced to death by an Iranian court for skimming billions in oil profits.
***
On July 14, 2015, after two years of painstaking multilateral negotiations, six world powers announced a historic deal to prevent Iran from developing nuclear weapons. Supporters hailed the agreement as a crucial step in forestalling Iran’s race for the bomb. Detractors lambasted it as a foolhardy giveaway to an implacable foe.
As part of the arrangements, U.S. officials agreed to remove Nayebi, Hosseinpour and Farsoudeh, as well as their associated companies—including Orchidea—from the sanctions list on the very day the Iran deal went into effect. Whatever the merits of the concessions U.S. officials made in service of their larger strategic goals, this much is clear: The three men were apparently important enough for Iranian negotiators to fight for their inclusion in the deal. Even before the deal, then, when it came to these three men, U.S. officials appear to have been walking a tightrope between political and prosecutorial concerns.
“It looks as if the size and scope of Nayebi, Hosseinpour and Farsoudeh’s operation made it hard for the Obama administration to ignore,” Ottolenghi told me. “So the administration had to sanction them, but because they were negotiating with [Iranian President Hassan] Rouhani, and were trying to get to a comprehensive deal, they didn’t go further.”
The U.S. government’s apparent lack of enthusiasm to “go further,” as Ottolenghi says—to bring criminal charges against Nayebi, Hosseinpour and Farsoudeh—has been an obvious boon to the three men, who still control significant assets abroad. According to Ottolenghi, Nayebi spends significant time in Georgia and Dubai, while Hosseinpour seem primarily Dubai-based. Farsoudeh’s whereabouts are unknown.
“Nayebi lives a luxurious life in Georgia,” Dimitri Aleksidze, a Tbilisi-based lawyer whose firm has been involved in complex civil litigation against Nayebi, told me. To this day, Aleksidze says, Nayebi owns apartment buildings, restaurants and tracts of land in that small Caucasian state. This is all the more “strange and surprising,” the Georgian lawyer claims, because in 2013 Georgian authorities opened an investigation into Nayebi, Hosseinpour and Farsoudeh for allegedly laundering hundreds of millions of dollars there. The three have never been formally charged, a fact Aleksidze also finds puzzling. Politico has not been able to independently confirm Alekisdze’s allegation that they’ve been the subject of an investigation there. Requests for comment sent to multiple email addresses associated with Nayebi, Hosseinpour and Farsoudeh went unanswered, as did attempts to reach Nayebi via his Georgia-based lawyer.
Given their apparent political connections, we may never learn the full story of the extent of the three Iranian men’s alleged dealings on behalf of the Iranian regime. Nor will we likely ever learn the full story about the Korean officials implicated in the scheme in Zong’s seized emails. Not only have Korean prosecutors cleared IBK of wrongdoing related to the case (though the bank paid a fine for improper dealings), but Korean investigators have also declined to press charges against KOSTI, the government export control authority, and the Bank of Korea, the country’s central bank.
There may be more trouble coming for IBK, however. The Korea Timeshas reported that the bank was under U.S. federal investigation for its role in transactions related to the Zong case. Garry Cuddy, IBK’s New York-based compliance officer, confirmed to me that the investigation is still ongoing, and that IBK’s legal counsel was currently in discussions with the Treasury Department’s Office of Foreign Assets Control (OFAC)—which tracks sanctions violations—and the U.S. Attorney’s Office in New York. Cuddy was unaware of whether the high-ranking IBK officials named in Zong’s emails were still employed by the bank. In March 2016, IBK’s New York branch reached a voluntary agreement with OFAC and the state of New York to strengthen its anti-money laundering controls, after “an examination of the Branch found deficiencies.”
***
Zong’s case, and the miasma surrounding it, shows just how challenging it is to sustain the kind of international sanctions regime that existed in the lead-up to the Iran deal. The financial pressures, even in steadfast U.S. allies like South Korea, may simply be too great.
According to the Korea Times, for example, during the years when Iran sanctions were at their harshest, IBK and Woori (both, again, state-owned) made “huge” profits because of their special arrangement with Iran. In 2012 alone, they added the equivalent of $4.4 billion in deposits. It was such a huge amount of money, in fact, that the paper also later reported that Iran threatened to withdraw the money unless the Korean banks increased their interest rates. But they eventfully reached a deal: In 2016, the two countries finalized an agreement to keep the accounts—and thus billions of dollars of Iranian capital—in these banks.
The Zong case also points to how difficult, if not outright impossible, re-instituting such multilateral sanctions will be, if President Trump makes good on past threats to pull out of the Iran deal. (The recent Iran sanctions bill passed in the Senate—tied to Iran’s human rights abuses, support for terrorism and ballistic missile program—is conspicuously silent on that country’s now-dormant nuclear weapons program.) Getting stalwart allies such as South Korea and Japan, which also depend on Iranian oil, to agree to such measures would be a strain. But convincing rival states such as China, which is also a major importer of Iranian oil, to revive past sanctions would require a herculean—and at this point, totally uncharacteristic—diplomatic effort on the Trump administration’s part.
And why, after all, would these states agree to such punitive measures? Business is booming. According to CNN, Iran tripled its worldwide oil exports from late 2015 to mid-2016 alone. Billions in Iranian funds are capitalizing state-owned South Korean banks. And in 2016, South Korea announced plans to treble its exports to Iran over the next three years. Ken Zong, the Alaskan former salmon exporter, an overeager small-timer, may find himself spending the rest of his life behind bars, but the bigger fish—in Dubai, Seoul, Tehran and Tbilisi—can now glide through much calmer, emerald-tinged financial waters.
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Zach Dorfman is senior fellow at the Carnegie Council for Ethics in International Affairs. His story for The Atavist, “Codename: Chilbom,” was a 2017 finalist for a Livingston Award.
HUFFPOST
06/08/2017 – Dr. Majid Rafizadeh
HUFFPOST – A resolution was recently introduced in the U.S. House of Representatives, condemning an atrocity that most Americans, and indeed most westerners, have never heard of: the 1988 killings of approximately 30,000 political prisoners in Iran.
Lawmakers led by Congressman Michael McCaul (R-TX), Ed Royce (R-CA), Eliot Engel (D-NY), and Pete Sessions (R-TX), and 42 of their colleagues from both sides of the aisle, chose to try to right that wrong, introducing legislation, H. Res. 188, deploring the murder of victims who “included thousands of people, including teenagers and pregnant women, imprisoned merely for participating in peaceful street protests and for possessing political reading material, many of whom had already served or were currently serving prison sentences.”
The cruelty was extreme as the resolution noted, “the families of the executed were denied information about their loved ones and were prohibited from mourning them in public”. But the outside world was kept pretty much in the dark. Or, when confronted with flashes of reality, many chose to close their eyes.
According to Amnesty International, the vast majority of the executed were affiliated with the main opposition People’s Mojahehin of Iran (PMOI/MEK). Prisoners were “brought before the commissions and briefly questioned about their political affiliation, and any prisoner who refused to renounce his or her affiliation with groups perceived as enemies by the regime was then taken away for execution,” the House resolution noted. The lawmakers were incensed to act in part by the audacity of the government of recently re-elected president Hassan Rouhani, who appointed as his Justice Minister one of the detested members of Tehran’s “death commission,” Mostafa Pourmohammadi. Many argue that like most instances of brutal carnage by autocratic, dictatorial or theocratic governments, the massacre was carried out in such a way that word of the executions spread to all corners of the country, terrorizing the populace and paralyzing thousands of families, neighborhoods, and communities with grief.
Many believe that what is even more galling is that the Supreme Leader Ali Khamenei’s pick to succeed Rouhani in last month’s presidential elections, Ebrahimi Raisi, had already been rewarded for his long years of allegiance by being named custodian of the Astan Buds Razavi foundation, the wealthiest charity in the Muslim world. Charity here is a relative term. In Iran under the mullahs and ruling clerics, it is believed that that the mega-millions all end up in the coffers of Iran’s Supreme Leader, to fund the Islamic Revolutionary Guards Corps and its fundamentalist agenda. Some argue that now Khamenei sought to manipulate the election, and thereby shore up his political establishment, by imposing Raisi on Iran’s unwilling people as their president. He most likely did not calculate that the campaign rivalry between the self-described “moderate” incumbent and his “hardliner” rival would bring the 1988 massacre to the surface, prompting public outrage so extreme that even powerful mullahs within Khamenei’s faction distained to support Raisi. Khamenei more likely backed down, which appears to be a big loss for him, but not a big change in the outcome for Iran’s people. In addition, many believe that Rouhani, also a veteran of this political establishment of the Islamic Republic, got another term likely to differ little from his first four years, which witnessed according to Amnesty International thousands of executions, an intense crackdown, rampant poverty and domestic injustice; parallel to escalating foreign meddling, skyrocketing military/security budgets, and the drive to advance the ballistic missile project. It was, however, another awakening to the ruling clerics of how past crimes against humanity can come back to haunt. In light of how deeply Iran’s nation reacted to this re-emergence of the 1988 massacre, more likely overturning efforts at the highest level to engineer the “election,” H. RES. 188 “Condemning the Government of the Islamic Republic of Iran for the 1988 massacre of political prisoners and calling for justice for the victims” is timely and righteous.
According to Amnesty International, the authorities have begun desecrating the unmarked mass graves of those executed in different cities including in Mashhad northeast Iran and in Ahwaz in the south of the country, fearful of the spread of the call for justice campaign regarding the victims of the 1988 massacre,
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In a statement issued on June 1, 2017, Amnesty International expressed alarm: “The desecration of a mass grave site in Ahvaz, southern Iran that contains the remains of at least 44 people who were extrajudicially executed would destroy vital forensic evidence and scupper opportunities for justice for the mass prisoner killings that took place across the country in 1988, said Amnesty International and Justice for Iran,” it wrote.
The legislators cited in their resolution a report from Amnesty International, concluding “there should be no impunity for human rights violations, no matter where or when they took place. The 1988 executions should be subject to an independent impartial investigation, and all those responsible should be brought to justice, and receive appropriate penalties.”
I second that.
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