Superseding Indictment Further Alleges That Four Defendants Allegedly Used the U.S. Banking System to Conduct International Financial Transactions for Iranian Airline Sanctioned for Supporting Terrorist Groups
Mohammad Zarrab et al. S2 Indictment.pdfPreet Bharara, the United States Attorney for the Southern District of New York, announced today the filing of a superseding indictment charging MOHAMMAD ZARRAB, a/k/a “Can Sarraf,” a/k/a “Kartalsmd,” with using the U.S. financial system to conduct hundreds of millions of dollars’ worth of transactions on behalf of the Government of Iran and other Iranian entities, which were barred by United States sanctions; laundering funds in connection with those illegal transactions; and defrauding several financial institutions by concealing the true nature of these transactions. The superseding indictment further alleges that MOHAMMAD ZARRAB’s co-defendants – REZA ZARRAB, a/k/a “Riza Sarraf,” CAMELIA JAMSHIDY, a/k/a “Kamelia Jamshidy,” and HOSSEIN NAJAFZADEH, who previously were charged in this case with the same offenses – participated in financial transactions for the benefit of Mahan Air, an Iranian Airline sanctioned for providing services for the Iranian Qods Force and Hizballah. The case is assigned to United States District Judge Richard M. Berman.
REZA ZARRAB was arrested on March 19, 2016, and is scheduled to begin trial on January 23, 2017, before Judge Berman. MOHAMMAD ZARRAB, JAMSHIDY, and NAJAFZADEH remain at large.
According to the allegations contained in the superseding indictment[1] filed today in Manhattan federal court:
Beginning in or about 1979, the president has repeatedly found that the situation in Iran constitutes an unusual and extraordinary threat to the national security, foreign policy, and economy of the United States and declared a national emergency to deal with the threat. Pursuant to these presidential declarations, the United States has instituted a host of economic sanctions against Iran and Iranian entities pursuant to the International Emergency Economic Powers Act (the “IEEPA”). This sanctions regime prohibits, among other things, financial transactions involving the United States or United States persons that were intended for the Government or Iran or Iranian entities.
Between at least in or about 2010 and in or about 2015, REZA ZARRAB, MOHAMMAD ZARRAB, JAMSHIDY, and NAJAFZADEH conspired to conduct international financial transactions on behalf of and for the benefit of, among others, Iranian business, the Iranian government, and entities owned or controlled by the Iranian government. Among the beneficiaries of the defendants’ scheme were:
- Mahan Air, an Iranian airline designated by the United States Department of the Treasury, Office of Foreign Assets Control (“OFAC”), as a Specially Designated National (“SDN”) pursuant to Executive Order 13224 for providing financial, material, and technological support to the Islamic Revolutionary Guard Corps-Qods Force (“IRGC-QF”), and providing transportation services to Hizballah, a Lebanon-based designated Foreign Terrorist Organization, including by transporting personnel, weapons and goods on behalf of Hizballah and omitting from Mahan Air cargo manifests secret weapons shipments bound for Hizballah;
- Bank Mellat, an Iranian government-owned bank designated as a SDN under the Iranian Transactions and Sanctions Regulations, the Iranian Financial Sanctions Regulations, and the Weapons of Mass Destruction Proliferators Sanctions Regulations; Mellat Exchange, an Iranian money services business owned and controlled by Bank Mellat;
- the National Iranian Oil Company (“NIOC”), identified by OFAC as an agent or affiliate of Iran’s Islamic Revolutionary Guard Corp; the Naftiran Intertrade Company Ltd., Naftiran Intertrade Company Sarl, and Hong Kong Intertrade Company, companies located in the United Kingdom, Switzerland, and Hong Kong that were acting on behalf of NIOC; and
- the MAPNA Group, an Iranian construction and power plant company.
REZA ZARRAB, MOHAMMAD ZARRAB, JAMSHIDY, NAJAFZADEH, and their co-conspirators used an international network of companies located in Iran, Turkey, the United Arab Emirates (“UAE”), and elsewhere to conceal from U.S. banks, OFAC, and others that the transactions were on behalf of and for the benefit of Iranian entities. This network of companies includes Royal Holding A.S., a holding company in Turkey; Durak Doviz Exchange, a money services business in Turkey; Flash Doviz Exchange, a money services business in Turkey; Al Nafees Exchange, a money services business in the UAE; Royal Emerald Investments, a company located in the UAE; Asi Kiymetli Madenler Turizm Otom, a company located in Turkey; ECB Kuyumculuk Ic Vedis Sanayi Ticaret Limited Sirketi, a company located in Turkey; Gunes General Trading LLC, a company located in the UAE; Hanedan General Trading LLC, a company in the UAE, and others. As a result of this scheme, the co-conspirators induced U.S. banks unknowingly to process international financial transactions in violation of the IEEPA.
Mahan Air provided transportation, funds transfers, and personnel travel services to the IRGC-QF, including by, among other things, providing travel services to IRGC-QF personnel flown to and from Iran and Syria for military training, aiding the covert travel of suspected IRGC-QF officers into and out of Iraq by bypassing normal security procedures, and facilitating IRGC-QF arms shipments. In addition, Mahan Air also provided services for Hizballah, transporting personnel, weapons, and goods on behalf of Hizballah. MOHAMMAD ZARRAB and his co-conspirators facilitated financial transactions through U.S. banking institutions that concealed that the transactions were for the benefit of Mahan Air. MOHAMMAD ZARRAB and his co-conspirators used their network of corporate entities in Turkey and UAE to conceal that Mahan Air was the true beneficiary of these transactions
REZA ZARRAB, 33, is a resident of Turkey and dual citizen of Turkey and Iran. MOHAMMAD ZARRAB, 38, is REZA ZARRAB’s brother, and is a resident of Turkey and dual citizen of Turkey and Iran. JAMSHIDY, 29, is a resident of Turkey and dual citizen of Turkey and Iran. NAJAFZADEH, 65, is a resident of Iran and the UAE and a citizen of Iran. Each defendant is charged with conspiracies to defraud the United States, to violate the IEEPA, to commit bank fraud, and to commit money laundering. The conspiracy to defraud the United States count carries a maximum term of five years in prison. The conspiracy to violate the IEEPA and money laundering conspiracy counts each carry a maximum term of 20 years in prison. The bank fraud conspiracy count carries a maximum term of 30 years in prison. The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
Mr. Bharara praised the outstanding investigative work of the FBI and its New York Field Office, Counterintelligence Division, and the Department of Justice, National Security Division, Counterintelligence and Export Control Section.
The prosecution of this case is being handled by the Office’s Terrorism and International Narcotics Unit. Assistant United States Attorneys Michael D. Lockard, Sidhardha Kamaraju, and David Denton, and Special Assistant United States Attorney Dean Sovolos, are in charge of the prosecution, with assistance from Trial Attorney Elizabeth Cannon of the Counterintelligence and Export Control Section. Assistant United States Attorney Jaimie Nawaday is principally responsible for the forfeiture aspects of the case.
The charges contained in the superseding indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
