Iranian convicted for running sanctions-busting scheme through Turkish front company

Iranian banker and former owner of Pilatus Bank Ali Sadr Hashemi Nejad was convicted on Monday for breaching U.S. sanctions on Iran in a $115-million scheme run through Venezuela and several front companies including one in Turkey.

The banker used a Venezuelan construction project to funnel more than $115 million in payments to a firm his family owned in Iran, the U.S. Justice Department said in a statement on the conviction.

The scheme saw Nejad and a co-conspirator establish front companies in Switzerland and Turkey which received payments from Venezuela’s state energy company, Petroleos de Venezuela (PDVSA), for a 2006 project to build 7,000 houses contracted with the Iranian International Housing Company, a conglomerate owned by Nejad and his family.

The two front companies received approximately 15 payments worth more than $115 million between April 2011 and November 2013 and concealed the involvement of the Iranian company from the U.S. financial system,

Nejad has been found guilty of one count of conspiracy to defraud the United States, one count of conspiracy to violate the IEEPA, one count of bank fraud, one count of conspiracy to commit bank fraud, and one count of money laundering, the department said. He was found not guilty of conspiracy to commit money laundering.

“Sadr’s conviction shows that U.S. economic sanctions against Iran are for real, and violators will be exposed and prosecuted,” Courthouse News quoted U.S. District Attorney Geofrey Berman as saying.

Turkey has been at the centre of a number of schemes to contravene sanctions on Iran in the past, notably one allegedly run through the state-run Halkbank that has been dubbed the largest sanctions-busting case in history. Mehmet Hakan Atilla, a former executive at Halkbak, was sentenced for his part in the scheme in 2018, and the bank still faces the possibility of a large fine over the scheme.

Last year, the U.S. Treasury placed sanctions on a network of companies, including a Turkish business, that it said had used deceptive practices allowing the sanctioned Venezuelan government to profit from Venezuelan gold sold in Turkey.

https://www.justice.gov/usao-sdny/pr/iranian-national-convicted-scheme-evade-us-economic-sanctions-illicitly-sending-more