According to The Washington Post, investigators have uncovered evidence of a multi-billion dollar corruption scheme which helped Iran evade sanctions for more than a decade. Iran is currently subject to United States Office of Foreign Assets Control (OFAC) sanctions for conducting destabilizing activites in the Middle East, including (but not limited to) the funding and training of terrorist groups, human rights abuses, and attempts to subvert internationally recognized governments. The sanctions, in particular, target individuals or entities that materially contribute to the Government of Iran with respect to its arms or ballistic missile program.
According to a Bahraini government audit, Bahrain-based Future Bank, a joint venture partly owned by two of Iran’s largest lenders, Bank Saderat Iran, and Bank Melli Iran, secretly helped Iran evade sanctions for more than a decade, and frequently altered financial documents to hide illict trade between Iran and dozens of foreign partners. FutureBank, aloong with all of its branches worldwide, was previously listed on the Specifically Designated Nationals list maintained by OFAC in March 2008, before it was removed as part of the Joint Comprehensive Plan of Action Agreement. The entity was still identified as part of the Government of Iran, prohibiting transactions with U.S. entities. Bank Saderat Iran and Bank Melli Iran had previously been accused by U.S. officials of helping finance Iran’s nuclear program and its international terrorism network.
The bank reportedly concealed at least USD 7 billion worth of transactions between 2004 and 2015, a time when many Iranian banks were barred by not just OFAC Sanctions, but by the European Union, for Iran’s nuclear activities. Auditors discovered hundreds of bank accounts tied to individuals convicted of crimes including money laundering and terrorist financing, as well as phantom loans provided to companies that operate as fronts for Iran’s Islamic Revolutionary Guard Corps, according to filings in the Permanent Court of Arbitration in The Hague. One of the evasion techniques used, “wire-stripping” involved the removal or changing of identifiying information when transferring money between banks, in order to conceal Iran’s involvement. In short, the bank allowed Iran to buy and sell billions of dollars worth of goods in defiance of international sanctions intended to punish Tehran over its nuclear program and support for terrorist groups.
According to Bahraini Foreign Minister Khalin bin Ahmed al-Khalifa, criminal proceedings were being pursued in the country, and the results of the investigation would be shared with other countries. In recent years, the Bahraini government has accused Iran of inciting violence against the country’s monarchy. In particular Bahraini officials criticized Future Bank for allowing a Shiite cleric tied to opposition movements in Bahrain, Isa Qassim, to make millions of dollars of cash deposits over several years. According to several Bahraini officials, he directed some of that money to a charity allegedly linked to terrorism, a technique commonly used in terrorist financing, and is difficult to prove.