Above picture shows Mahmoud Ahmadinejad along with Hamid Baghaei,an Iranian politician and former intelligence officer who was considered one of Mahmoud Ahmadinejad’s closest advisers.
Mahafarid Amir Khosravi (c. 1969 – May 24, 2014), also known as Amir Mansour Aria (Persian: امیر منصور آریا ), was an Iranian businessman who was executed for his part in the 2011 Iranian embezzlement scandal. At one time, he was considered the richest man in Iran. An assessment made in April 2012 suggested he would rank as 219th among Forbes‘ richest people in the world if included on the list.
Mahafarid Khosravi above attempting to protest his innocence
By 2011, Khosravi’s business holdings included more than 35 companies engaging in diverse business segments including mineral water, meat importation, and a football club. His net worth exceeded US$1 billion.In 2011, an investigation into fraudulent loans at Bank Saderat, one of Iran’s top banks, was launched. It was determined that Khosravi was the mastermind of a scheme that generated US$2.6 billion of loans with forged documents, dating back to 2007. Under the scheme, bank managers were bribed by Aria Investment Development Company to accept the forged documents. The loans were then used to purchase state-owned businesses, effectively privatizing the companies using state funds since the loans would not be repaid. According to the investigation, Khosravi’s company was worth 50 million tomans in June 2006, and had reached a value of 20 billion tomans by February 2009 due primarily to the loans transactions.
Khosravi was charged with being “corrupt on earth”, a charge that would make him an enemy of God and carry the death penalty. At his trial, he admitted to bribing Mahmoud Reza Khavari, the former head of Bank Melli, and others with more than US$3 million.He was convicted of embezzlement, money laundering, and bribery. He and three of his closest associates received the death penalty in July 2012. A total of 39 people were convicted in what was the largest fraud case since the 1979 Iranian Revolution. In the investigation, it was alleged that President Mahmoud Ahmadinejad was an ally of Khosravi. Ahmadinejad was questioned on his involvement with the embezzlement scheme, but no connection was proven.
Khosravi was executed by hanging in Evin Prison in Tehran on May 24, 2014. An appeal to stop the death sentence being carried out was dismissed by Iran’s Supreme Court in the week prior to the execution. After his death, his wife, Sara Khosravi, said that she was informed about the death of her husband through the news and did not believe it until their lawyer could see the body and confirm the death. She said that in their last meeting, the day before the execution, Mahafarid had been in good condition and was still hoping for a change to his death sentence.
Khosravi’s lawyer, Gholam Ali Riahi, was quoted by news website khabaronline.ir as saying that his client was put to death without any notice.
“I had not been informed about execution of my client,” Riahi said. “All the assets of my client are at the disposal of the prosecutor’s office.”
How other Nations have dealt with banking crimes
(Wikipedia) “Mofsed-e-filarz is the title of capital crime (or person guilty of the crime) in the Republic of Iran, that has been translated in English language sources variously as “spreading corruption on Earth”, “spreading corruption that threatens social and political well-being”, “corrupt of the earth; one who is charged with spreading corruption,” “gross offenders of the moral order”, and “enemies of God on Earth.”
State officials did not immediately comment on Riahi’s claim.
The fraud involved using forged documents to get credit at one of Iran’s top financial institutions, Bank Saderat, to purchase assets including state-owned companies like major steel producer Khuzestan Steel Co.
Khosravi’s business empire included more than 35 companies from mineral water production to a football club and meat imports from Brazil.
According to Iranian media reports, the bank fraud began in 2007.
A total of 39 defendants were convicted in the case.
Four received death sentences, two got life sentences and the rest received sentences of up to 25 years in prison.
The trials raised questions about corruption at senior levels in Iran’s tightly controlled economy during the administration of former President Mahmoud Ahmadinejad.
Mahmoud Reza Khavari, a former head of Bank Melli, another major Iranian bank, escaped to Canada in 2011 after he resigned over the case.
He faces charges over the case in Iran and remains on the Islamic Republic’s wanted list.
Corruption Allegations backdrop
Ahmadinejad has long been dogged by claims of corruption and economic mismanagement. The Judiciary claims that it has a pending case against him, but details have never been released and no court proceedings have taken place.
The Supreme Audit Court issued seven verdicts against Ahmadinejad, five of them related to revenues from oil, the country’s main export. The two other verdicts were not disclosed.
The court said it was up to parliament to decide whether to bring charges against Ahmadinejad and sentence him.
In one case, Ahmadinejad was found guilty of illegally allocating around $2 billion from the national treasury earmarked for paying cash subsidies to citizens. The government replaced food and fuel subsidies with cash payments in 2010, a move credited with compounding the economic crisis in the Islamic republic.
The court also found Ahmadinejad guilty of spending millions of dollars on gasoline subsidies, saying the move was unlawful because it only benefitted a segment of society.
Ahmadinejad was also found guilty of unlawfully allocating funds to the Iranian Red Crescent, a Tehran-based NGO that has been accused of smuggling intelligence agents and weapons to other countries.
Another charge, which was not explained, issued a verdict against Ahmadinejad over the case of Babak Zanjani, one of Iran’s richest men, who was arrested in 2013 and is accused of stealing more than $2 billion from the government through crooked oil sales he made during Ahmadinejad’s time in office. He was convicted of massive embezzlement and sentenced to death in 2015.
During Ahmadinejad’s time in office Zanjani was considered something of a hero because of his ability to help Iran evade international sanctions and sell its oil abroad. But he was arrested soon after current President Hassan Rohani assumed office.
Mahmud Ahmadinejad was no stranger to controversy during his two terms as Iran’s president. Now he faces possible sentencing for his alleged mishandling of billions of dollars during his time in office.
But following news that multiple verdicts have been issued against the former president, analysts looking at the murky legal process suggest that the development is intended as a warning for Ahmadinejad to rein in his criticism of the country’s clerical establishment.
“This is not simply a legal procedure but a political stick that can be wielded over Ahmadinejad to say, ‘if you really challenge the system, then we have complete control and can take away your freedom,'” says Scott Lucas, an Iran specialist at Birmingham University in Britain and editor of the EA World View website.
Fayaz Shojaie, the public prosecutor at Iran’s Supreme Audit Court, told the Etemad newspaper in an interview published on July 30 that the court had issued seven verdicts against Ahmadinejad. The Supreme Audit Court falls under the supervision of parliament, and it is unclear if Ahmadinejad was formally tried by the court and is now facing sentencing or whether the verdicts should be viewed as recommendations to be followed up by parliament, which would be more in keeping with the court’s role.
The Shanghai Daily back on May 24 2014 had this to say and puts its all more succinctly
Iran executes billionaire in bank fraud
Source: XINHUA | May 24, 2014
TEHRAN, May 24 (Xinhua) — Iran executed on Saturday a billionaire businessman involved in the biggest embezzlement case in the country’s banking history, Press TV reported.
Mahafarid Amir-Khosravi, the owner of Amir Mansour Aria Company, who reportedly swindled 2.6 billion U.S. dollars out of some banks, was convicted of disrupting the country’s economy through embezzlement, money laundering and bribery, the report said.
He has been hanged at Tehran’s Evin detention center in the capital Tehran after the Iran’s Supreme Court upheld his death sentence, according to the report.
Three others, including Behdad Behzadi, legal advisor of Amir- Khosravi, Iraj Shoja, his financial solicitor, and Saeed Kiani Rezazadeh, the head of the Ahvaz branch of Saderat Bank, have also been sentenced to death over the fraud.
In the summer of 2011, Iranian media reported that nearly 2.6 billion dollars was swindled out of several banks over a span of more than two years by Amir Mansour Aria Company, whose owner, taking advantage of the government connections, purchased swaths of state-owned assets, including those of Iran’s second largest steel maker Khuzestan Steel Company.
In October 2011, Iranian media said a number of Iranian banking officials were also arrested over the scandal, allegedly one of the biggest frauds in Iran’s history.
Ahmadinejad, who served as president from 2005 to 2013, has clashed with and fallen out of favor with the establishment since leaving office. His administration is frequently tied to allegations of corruption and is accused by detractors of mismanaging the economy.
He registered to run in the May presidential election against the wishes of Supreme Leader Ayatollah Ali Khamenei. He was eventually disqualified by the powerful Guardians Council, half of whose members are chosen directly by the supreme leader.
His former vice president and close aide, Hamid Baghaei, was sent to prison in 2015 on unidentified charges. Baghaei was again behind bars over corruption allegations from July 9 of this year until his release on bail on July 26.
In unprecedented criticism of the authorities, Baghaei accused the Judiciary of being “liars” and condemned the treatment of inmates in Iranian prisoners. The Judiciary, backed by the supreme leader, is an all-powerful institution, often acting against opponents and critics of the establishment.
Ahmadinejad, who greeted Baghaei outside the prison, described his close ally’s detention as “illegal” and a “great cruelty.”
Mahafarid Amir Khosravi worth 2.6 billion dollars was not so well connected , not so lucky and was been executed in Iran.In May 2014, Iran executed billionaire businessman Mahafarid Amir Khosravi, accused of being at the heart of a state bank scam worth 2.6 billion dollars that started in 2007. Although Ahmadinejad denies any involvement, many believe that during his administration corruption was rife throughout those that controlled the country’s economy. Khosravi’s case was the largest fraud case since the 1979 Revolution.
On June 8th, the former vice-president in charge of executive affairs, Hamid Baghaei, was detained for questioning on undisclosed charges, but it is believed that he is suspected to be linked to an embezzlement scandal the Iranian judiciary system has been investigating since last year. This is part of a nation-wide effort to punish and prevent money laundering and corruption promoted by Hassan Rouhani’s government. Since when he was elected as president in June 2013, Rouhani has been one of the staunchest critics of the previous administration, led by Mahmoud Ahmadinejad (2005-2013), accused of facilitating and being involved in a number of corruption scandals.
Judiciary spokesperson, Gholamhossein Mohseni-Ajai, declared to Fars News Agency that ‘former vice-president Hamid Baghaei had a charge sheet issued against him by the judiciary and the prosecutor summoned him today for questioning’, but no further detail was added. Baghaei’s arrest is the second during this year. In fact, in January the former vice-president Mohammad Reza Rahimi was condemned to 5-year imprisonment and to pay a fine of nearly 10 billion rials, corresponding to 300,000 Euro, in connection with money laundering and an embezzlement scheme worth billions of dollars. Although Mohseni-Ajai did not specify the charges against Baghaei, it is believed that the two arrests are linked, therefore outlining a broader scenario where the very final objective might be the one of putting the former president Ahmadinejad under pressure.
Despite facing fierce opposition from the Supreme Leader, the current administration, the parliament and the security apparatus, Ahmadinejad seems to be willing to come back on the national political scene. Former vice-president Rahimi, a friend to Ahmadinejad, apparently wrote a letter to him after his arrest. The letter was later leaked and it linked Ahmadinejad to the corruption scandal. In May 2014, Iran executed billionaire businessman Mahafarid Amir Khosravi, accused of being at the heart of a state bank scam worth 2.6 billion dollars that started in 2007. Although Ahmadinejad denies any involvement, many believe that during his administration corruption was rife throughout those that controlled the country’s economy. Khosravi’s case was the largest fraud case since the 1979 Revolution.
As vice president, Rahimi faced allegations that he was the head of the ‘Fatemi Street Ring’, a group of government appointees and associates that during Ahmadinejad’s governments engaged in a number of embezzlements and bribe takings. Journalists and MPs have accused Rahimi of blackmailing the board of the National State Insurance Company with reports on the company engaging in financial impropriety, thus forcing the directors to sign off millions of dollars into accounts Rahimi controlled. Because Rahimi was appointed as vice president after Ahmadinejad got re-elected as president in 2009, it is speculated that he had a crucial role in help securing funding to sustain the president’s ascent.
On Sunday, president Hassan Rouhani called for the establishment of a ‘completely secure banking system’ to prevent money laundering as part of his administration’s ongoing anti-corruption campaign. Rouhani also stated that Parliament ‘is expected to speed up passing the money laundering bill.’ Rouhani held a cabinet session on June 7 to promote government transparency, stating that ‘A completely secure banking system for official and legal activities …[that] is extremely insecure for illegal activities must be established so that no one can abuse the banking system for money laundering’. The president urged officials to utilize legal measures to strengthen financial transparency and said that the ‘government and judiciary have to cooperate in this regard and the Parliament is also expected to speed up passing the money laundering bill.’
Currently, in Iran all top political figures are supporting efforts for increasing transparency, communicating to the private sector that the new government is cleaning up the scene to attract more genuinely private investments. Gholam Hossein Shafei, president of the Iran Chamber of Commerce, Industry and Mining, has presented his road map for fighting corruption. His guidelines include: ‘political and structural reforms; serious reforms in management concepts; genuine privatization; growing role for nongovernmental organizations and civil society; growing space for independent media to supervise business and government activities; and the promotion of codes of conduct in the private and public sectors.’
The Supreme Leader seems to have given free hand to Rouhani’s efforts, considering that he effectively control Iran’s judiciary system. He is believed to have played a crucial role in making Rahimi’s arrest to happen, and it is likely that he had a similar relevance also in Baghaei’s current detention. It is no coincidence, in fact, he repeatedly called for transparency. Iran is indeed in the middle of a 20-year plan to decentralise and privatise its economy. Supreme leader Ayatollah Ali Khamenei has repeatedly warned officials against using the transition program as a chance to enrich themselves.
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