By Ali Al-Bassam
Impunity Watch Reporter, Middle East
TEHRAN, Iran — Four people have been sentenced to death by an Iranian court for their involvement in the largest ever bank fraud scandal in the country’s history.
Two other defendants received life sentences, while 33 more will spend up to 25 years in jail, the chief prosecutor was quoted as saying.
“According to the sentence that was issued, four of the defendants in this case were sentenced to death,” Prosecutor General Gholam-Hossein Mohseni-Ejei told IRNA, the country’s state-run news agency.
In addition to jail time, some were sentenced to flogging, ordered to pay fines, and banned from holding government jobs.
The case became public in September 2011, when an investment firm was accused of forging documents to obtain credit from at least seven Iranian banks over a four-year period. It reportedly involved forged documents used to secure a $2.6 billion loan. The money was reportedly used to buy government-owned companies under the government’s privatization scheme.
Allegations included that the embezzlement was carried out by people close to the political elite or with their assent. The story’s breaking fueled weeks of political conflict between President Mahmoud Ahmadinejad, who denied his government’s involvement last year, and Iran’s ruling hierarchy of clerics. Ayatollah Ali Khamenei, while criticizing financial corruption and acknowledging the political damage, said in televised comments last year that the media should not “drag out the issue.”
“Some want to use this event to score points against the country’s officials,” Khamenei said. “The people should know the issue will be followed up on.”
Businessman Amir Mansoor Khosravi, who the Iranian media has described as the mastermind behind the scheme, is said to have forged letters of credit from Iran’s Bank Saderat to fund dozens of companies and buy a state-owned steel factory. Mahmoud Reza Khavari, the former head of Iran’s largest bank–the state-owned Bank Melli–resigned because of the scandal. He then fled to Canada, where records indicate that he owns a $3 million home.
Mohseni-Ejei did not name the defendants on trial, and the Iranian media only identified them by their initials. State television broadcast parts of the trial, but blurred out the faces of the accused. He believes the case demonstrates that Iran can appropriately deal with high level fraud.
“The government, parliament, and all available devices were used to pursue the issue so that corruption can be fought in an open manner,” he said.
Despite the Prosecutor General’s claim, one defendant believes that while the judiciary vigorously pursued some low-level players, senior officials involved in the scheme had gone unpunished. “Many other banking officials are outside of prison right now,” an unnamed steel company official asserted. “Why are you able to put us on trial and have nothing to do with them?”
For further information, please see:
Al Arabiya — Four Sentenced to Death for Iran’s Biggest Bank Fraud — 30 July 2012
Al Jazeera — Death Terms in Iran Bank Scandal — 30 July 2012
BBC News — Four Sentenced to Death over $2.6bn Iran Bank Fraud — 30 July 2012
The Guardian — Iran Sentences Four to Death Over Bank Fraud With Political Fallout — 30 July 2012
Reuters — Iran Sentences Four People to Death for Bank Fraud — 30 July 2012
