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Florida: U.S. Arrests Iranian Turk in $110 Billion Illegal Gold for Gas Deal

Patrick Goodenough’s CNS article chronicles this latest expose of corruption by Turkey’s Islamist Recep Tayyip Erdogan in a $100 billion dollar gold for gas scheme, discovered in 2013, evading UN and U.S. sanctions against dealing with a  Nuclear Iran Iran-Related Arrest in Florida Could Have Political Implications for Turkey’s Islamist Ruling Party.  Goodenough gives credit to the investigation team at the Washington, DC based Foundation for Defense of Democracy research uncovering this duplicity, while the Administration was actively pursuing negotiations over an Iran nuclear pact.  Goodenough writes:

The arrest in Florida of a prominent Iranian-Turkish businessman accused of conspiring to conduct hundreds of millions of dollars in financial transactions to help Iran evade U.S. sanctions may have major political implications in Turkey, where the same man was linked to a corruption scandal reaching into the upper ranks of the ruling party.

A senior opposition leader expressed the hope that the arrest of Reza Zarrab, an Iranian-born Turkish businessman, may lift the lid on a scandal which many critics suspect was covered up by President Recep Tayyip Erdogan’s Islamist Justice and Development Party (AKP).

The Hurriyet daily quoted Republican People’s Party (CHP) chairman Kemal Kilicdaroglu as saying in parliament Tuesday that as a result of Zarrab’s arrest, “I am sure many will not get a wink of sleep tonight; they won’t be able to sleep in comfort in their beds.”

“Reza Zarrab will speak there, you will see,” he said, adding that “dirty relations will be exposed” and the facts will emerge about four AKP cabinet ministers who were the subject of massive fraud and corruption allegations three years ago.

The Department of Justice announced Monday the unsealing of an indictment in the in the Southern District of New York against dual Turkish-Iranian citizen Zarrab, 33, who was arrested in Florida on Saturday; and two Iranian nationals who remain at large, Camelia Jamshidy, 29, and Hossein Najafzadeh, 65.

John Carlin, assistant attorney-general for national security, said that according to the charges the three had “circumvented U.S. sanctions by conducting millions of dollars-worth of transactions on behalf of the Iranian government and Iranian businesses.”

“These alleged violations, as well as the subsequent efforts taken to cover up these illicit actions, undermined U.S. laws designed to protect national security interests,” he said.

According to the indictment, between 2010 and 2015 the three allegedly conspired to thwart U.S. and international economic sanctions against Iran by concealing financial transactions that were on behalf of the Iranian government or government-controlled banks and other entities.

They used a network of companies located in Iran, Turkey and elsewhere to conceal from U.S. banks, the Treasury Department’s Office of Foreign Assets Control (OFAC) and others the fact that the transactions were benefiting and on behalf of Iranian entities.

The indictment quotes from a Dec. 2011 letter from Zarrab, addressed to the general manager of the Central Bank of Iran saying in part, “[i]t is not secret that the trend is moving towards intensifying and increasing the sanctions, and since the wise leader of the Islamic Revolution of Iran has announced this to be the year of the Economic Jihad, the Zarrab family, which has had a half a century of experience in foreign exchange, … considers it to be our national and moral duty to declare our willingness to participate in any kind of cooperation in order to implement monetary and foreign exchange anti-sanction policies …”

[…]

Earlier research into the “gas for gold” scheme by the Foundation for Defense of Democracies and Roubini Global Economics found that Iran and Turkey’s Halkbank were exploiting loopholes in U.S. sanctions law.

Here’s what we wrote about Zarrab and the emergence of the illegal gold trading back in a NER/Iconoclast post in January 2014.

Meanwhile the main secular opposition, the People’s Republican Party (CHP) lead by Kemal Kilicdaroglu in Turkey’s parliament has kept up a stream of constant criticism of Erdogan endeavoring to place him at the center of the corruption probe. Yesterday, he questioned the Turkish Intelligence (MIT) report on the illegal gold trading submitted in April 2013 involving Azeri Iranian businessman Reza Zarrab. Today’s Zaman reported Kilicdaroglu saying:

In a weekly meeting of his party’s parliamentary group on Tuesday, Kilicdaroglu addressed reports published Monday in a number of media outlets claiming that the National Intelligence Organization (MIT) submitted a report to Erdogan on April 18, 2013 detailing the shady relations – involving bribery and influence-peddling – of certain ministers with Iranian businessman Reza Zarrab, who is under arrest. “I would like to ask the prime minister about what he did upon receiving this report. Did you call these ministers and talk to them? Did you talk to your children? He didn’t. He is the one who gave these orders,” Kilicdaroglu said.

These latest developments on the Zarrab illegal gold trading for Iranian gas call into question the Administration’s policy of supporting Muslim Brotherhood and ISIS supporters like Erdogan. Erdogan’s Turkey, while criticized  by the US and  NATO, hasn’t been dismissed as a member of the mutual defense pact,   given his war against the Kurds inside the country,  across the border in north Syria and even in the Iraqi Kurdish region. All while surreptitiously supporting ISIS emboldening his family’s shipping and oil smuggling profiteering. Question why Israel wants to renew relations with Turkey after the May 2010 Mavi Mamara free Gaza incident paying $20 million in alleged wrongful death compensation for the nine Turkish nationals killed in the scuffle with Israel Naval commandos.  Note this recent anti-Semitic comment by the AKP woman official following the Istanbul blast that killed three Israelis, two of whom were American citizens, injuring ten others, from a Jerusalem Post report:

 An official from Turkish President Recep Tayyip Erdogan’s ruling AKP Party tweeted that she “wished the Israelis” who were said to be wounded in Saturday’s Istanbul suicide blast were dead. Irem Aktas made the provocative tweet immediately after the attack. Turkish sources said that Aktas is the head of the party’s media relations and women’s outreach department.

Credit the team at the Foundation for Defense of Democracies for sleuthing the gold for gas scheme from open sources that we wrote about back in 2014.   Cliff May, President of FDD wrote this in an email:

This week, the Department of Justice announced the arrest of Turkish-Iranian national Reza Zarrab, upon his arrival in Miami. Among the charges: defrauding the US government.

Zarrab briefly made news in late 2013, when he was arrested on charges of corruption in Turkey, where he then resided. He was presumed to have coordinated Iran’s largest and most sophisticated sanctions evasion scheme on behalf of Babak Zanjani, an Iranian formerly under U.S. and EU sanctions who was recently sentenced to death in Iran for embezzlement.

The Turkish government quashed the police investigation against Zarrab — presumably because of the involvement of senior government officials in the corruption scheme he devised to grease the wheels of his operation.

The U.S. administration, keen not to undermine the chances of a nuclear deal with Iran, declined to pursue the dozens of companies and individuals involved in a giant financial scam that enabled Iran to launder more than $100 billion worth of oil and gas revenue, transform it into gold and ship it back to Iran through a trail of companies that went from Dubai to Turkey, from Istanbul to Tajikistan, from Tashkent to Malaysia.

For years, FDD has tirelessly and doggedly documented these networks. FDD Senior Fellow Emanuele Ottolenghi identified Mehdi Shams, one of Zanjani’s key associates, and mapped out his network of front companies in Europe and the Middle East as early as September 2013.

Despite reluctance by U.S. officials to take any action against Shams, Emanuele kept pushing the story as did others at FDD. When the Zarrab-Zanjani connection was exposed in December 2013, the Daily Beast extensively quoted Emanuele and exposed Shams’ links to Zanjani.

FDD’s Executive Director Mark Dubowitz and VP for Research Jonathan Schanzer detailed in hard hitting pieces the nature of the sanctions scheme. Their work helped inspire Congress to make important legislative changes designed to close a critical loophole in the sanctions architecture.

With the corruption scandal case in full swing in Turkey, Emanuele and FDD Fellow Saeed Ghasseminejad exposed another Zanjani associate in early January 2014 in a piece published in Turkey’s daily, Hurriyet. The man they named, Hamid Sallah Heravi, was sentenced to death along with Shams and Zanjani two weeks ago.

Then, in March 2014, with Turkey’s Erdogan determined to quash the investigation, the Turkish prosecutor’s indictment was leaked. FDD Turkish affairs analyst Merve Tahiroglu provided critical analysis based on a 330-page document that FDD promptly provided to Treasury.

Our team continued to follow the story and its many angles and to provide critical open-source intelligence to government authorities.

Our efforts have now paid off: Revelations from the Zanjani trial vindicate our insistence on going after his networks and his associates. They confirm our fellows’ open-source research on Iranian illicit finance networks. And the arrest of Zarrab in the United States is now sure to further expose the high levels of collusion and corruption within the Erdogan government.

Meanwhile, President Obama fresh from his fractious trip to Cuba with autocratic aging Communist dictator Raul Castro disputing the country’s notorious human rights record and family control over the economy has another problem upon arrival in Buenos Aires when he meet with President Mauricio Macri, whose election ended the corrupt 12 year reign of the Peronista Justicia party of former President Cristina Kirchner and her late husband. It concerns the release of US intelligence on Iranian involvement in the 1994 AMIA Jewish Center in Buenos Aires that figured in the murky circumstances behind the murder of the late Argentinean special prosecutor Alberto Nisman in January 2015.  Stay tuned for developments in these stories dogging the President’s valedictory lap in Cuba and Latin America.

EDITORS NOTE: This column originally appeared in the New English Review.

Documentary ‘Los Abandandos’: Iran’s Assassination of Argentine Prosecutor Alberto Nisman

When Argentine Prosecutor Alberto Nisman was murdered under mysterious circumstances on January 18, 2015, we wrote of the curious circumstances surrounding his death. He was found dead in his Buenos Aires flat with a bullet to his head with a pistol allegedly in his possession. He was on the brink of presenting a 300 page brief to a committee of the Argentine Congress based on a decade of investigations. Investigations begun under the auspices of the late President of Argentina Nestor Kirchner and after his passing in 2007, for a time under his successor, his wife Cristina.

Nisman’s death came amidst revelations about negotiations of a Memorandum of Understanding in 2013 between Iran and outgoing Argentine President Cristina de Fernandez Kirchner and Foreign Minister Hector Timmerman regarding a truth commission. The object of the commission was to facilitate an expose of Iran’s and its proxy Hezbollah’s roles in both the 1992 Buenos Aires Israel Embassy and 1994 AMIA Buenos Aires, Jewish Center bombings. Bombings that killed 114, injuring 542.In exchange for no prosecution following the truth commission proceedings, Iran and Argentina would renew their commercial trade.

On the occasion of Nisman’s January 30, 2015 funeral and interment in the martyrs section of the La Tablada Jewish cemetery in Buenos Aires we wrote in an Iconoclast Post, “There is No Justice in Argentina” :

Many in the Argentine Jewish Community considered that appropriate as they deemed him the “86th victim” of the AMIA blast. In effect his burial in the Martyrs section repudiated initial official assessments from President Cristina de Fernandez Kirchner and the investigating prosecutor that he may have been a suicide. Kirchner quickly changed her story to a likely murder by rogue intelligence elements who had “manipulated” Nisman.

By the time outgoing President Cristina Kirchner gave her valedictory speech at the UN General Assembly on September 28, 2015, she referred to the dismissal and trial of officials in the country’s intelligence echelon who she alleged impeded the investigation saying, “prosecutor Nisman, in charge of the case, passed away.”

Cliff May, President of the Foundation for Defense of Democracies attended a recent premier of a new documentary, Los Abandandos, (The Abandoned) about Nisman’s murder and the AMIA bombing investigations at Washington, DC’s, Newseum. . He published an opinion column in today’s Washington Times about the unsolved mystery of Nisman’s death and the comments of the film’s director, “Argentine Murder Mystery”. May noted:

The evidence, of which there is no shortage, leads to one conclusion: Iran’s rulers ordered the mass murder; Iran’s proxy terrorist organization, Hezbollah, carried out the mass murder; and in recent years Argentine officials at the highest levels have been involved in a cover-up of the mass murder.

May notes what possessed the director of Los Abandandos, Matthew Taylor, to pursue the story and create a riveting documentary:

To prevent the truth from passing away, Mr. Taylor went to Argentina where he quietly — he didn’t inform authorities — interviewed journalists, opposition politicians and anyone else brave enough to tell him what they knew. As the film shows, Argentines have gathered by the hundreds of thousands to protest what they see as their government’s capitulation to terrorists. Some have carried signs reading: “Islamic Fundamentalists Killed Nisman.”

In a conversation immediately following last week’s screening, Mr. Taylor was asked if he had made the movie to influence opinion about President Obama’s nuclear weapons agreement with Iran. When he began the project, he replied, he was not even aware of that controversy. But the film does serve, he added, as “a guide to what happens when you do deals with Iran.”

He pointed out that the AMIA bombing and the murder of Nisman started “with a nuclear deal” — an agreement Argentina made in the late 1980s to provide Iran with nuclear technology and assistance. Eventually, under pressure from the United States, the Argentine government did not give Iran’s revolutionary theocrats what they wanted.

One plausible theory — in essence, Nisman’s theory — is that the attack was Iran’s way of sending a message and a warning: “This time we kill Argentine Jews. Disappoint us again and who knows what our targets will be?”

May concluded:

Whatever the reasons, Mrs. Kirchner’s Faustian bargain necessitated abandoning both the AMIA victims and Nisman. Did it necessitate something even worse? That remains an unsolved murder mystery.

The Islamic fundamentalists who rule Iran are as determined and ruthless as any in the world. Their agents, including Hezbollah, are increasingly influential throughout much of Latin America.

Watch this You Tube video of the trailer for Los Abandandos:

Will the mystery of Nisman’s murder be resolved following the looming Argentine Presidential election on October 25th? That contest pits ruling Peronist Justicialist party candidate Daniel Scioli, the anointed successor to Kirchner, against  Buenos Aires Mayor, Mauricio Macri of the Center Right, PRO party. The latest polls taken show Scioli ahead of Macri, despite the former  not showing up for a televised Presidential debate Sunday; 41.3 % to Marci’s 30.5%.  There are five Presidential candidates in the race. The Buenos Aires Herald quoted Macri in late January 2015 saying, “The priority is to clarify the circumstances of  his death. We need to be respectful and allow the Judiciary to work. Nisman’s death cannot go unpunished.”  Should Scioli maintain his lead, we doubt that the mystery of Nisman’s death will be resolved anytime soon.

EDITORS NOTE: This column originally appeared in the New English Review. The featured image is the Alberto Nisman assassination graphic by Greg Groesch/Washington Times.

Obama Threatens to Veto the Nuclear Weapons Free Iran Act

Like many Americans and Israelis I watched expectantly President Obama’s State of the Union Address (SOTUS)  before a joint session of Congress crammed into the House Chamber. I was looking for a reaction from the Congressional audience on the issue of the P5+1 agreement implemented on January 20th. Iran’s President Rouhani had basically told  the P5+1  in a CNN  interview at the World Economic Forum in Davos, Switzerland that the Islamic regime was not going to dismantle their nuclear program. Instead they were going to plough ahead with research and development on advanced centrifuges and would not swap the Arak heavy water plant that would produce plutonium for a bomb.

In  light of these jarring comments made in Davos, Switzerland  by President Rouhani  at the World Economic  Forum, you would have prudently thought that the President would have changed his mind about  vetoing  the Nuclear Weapons Free Iran Act (NWFIA), S. 1881. Obama made it clear that he was proceeding with the P5+1 deal as a diplomatic way of  avoiding  military action to disable the Islamic Regime’s  nuclear weapons capability.  A capability that according to Israeli PM Netanyahu  speaking at the Annual Conference of the Institute for National Security studies at Tel Aviv University  (INSS) was  “six weeks away from achievement when the P5+1 deal was signed” on November 24, 2013 in Geneva.

President Obama fired a bow shot directed at NWFIA sponsors Sens. Kirk and Menendez, and 57 other co-sponsors of S. 1881, as well as the Resolution introduced in by House Majority Leader Eric Cantor  (R-VA)  and Minority Leader Steny  Hoyer (D-Md.) supporting its passage.

Obama said:

Let me be clear if this Congress sends me a new sanctions bill now that threatens to derail these talks, I will veto it.

For the sake of our national security, we must give diplomacy a chance to succeed.

If Iran’s leaders do not seize this opportunity, then I will be the first to call for more sanctions, and stand ready to exercise all options to make sure Iran does not build a nuclear weapon.  But if Iran’s leaders do seize the chance, then Iran could take an important step to rejoin the community of nations, and we will have resolved one of the leading security challenges of our time without the risks of war.

It is American diplomacy, backed by pressure, that has halted the progress of Iran’s nuclear program – and rolled parts of that program back – for the very first time in a decade. As we gather here tonight, Iran has begun to eliminate its stockpile of higher levels of enriched uranium. It is not installing advanced centrifuges. Unprecedented inspections help the world verify, every day, that Iran is not building a bomb.

If John F. Kennedy and Ronald Reagan could negotiate with the Soviet Union then surely a strong and confident America can negotiate with less powerful adversaries today.

Watch this C-SPAN video clip of the nuclear Iran segment of his SOTUS:

The immediate reaction was clearly stony silence from the Republican members of both chambers in the audience.

According to a  Jerusalem Postarticle on the President’s veto threat, NWFIA co-sponsor Sen. Kirk said:

“The American people – Democrats and Republicans alike – overwhelmingly want Iran held accountable during any negotiations. While the president promises to veto any new Iran sanctions legislation, the Iranians have already vetoed any dismantlement of their nuclear infrastructure,” Kirk added, calling his bill an “insurance policy” for Congress.

The Hill  Global Affairs blog reported the dissembling  the morning after  the President’s SOTUS remarks on a nuclear Iran by some Democratic co-sponsors of NWFIA in the wake of the President’s public veto threat.  Note these Senators’ comments:

Sen. Joe Manchin (D-W.Va.) said on MSNBC Tuesday night that he didn’t endorse the bill so that it could be voted on during negotiations with Iran. “Give peace a chance,” he said.

“I did not sign it with the intention that it would ever be voted upon or used upon while we were negotiating,” Manchin said. “I signed it because I wanted to make sure the president had a hammer, if he needed it and showed them how determined we were to do it and use it, if we had to.”

[…]

“Now is not the time for a vote on the Iran sanctions bill,” Coons said Wednesday at a Politico event, according to The Huffington Post.

The senator clarified that he still supports the bill but warned advancing it now could damage ongoing negotiations toward a final agreement with Iran.

[…]

“I’m not frustrated,” Menendez told The Huffington Post on Tuesday after Obama’s address. “The president has every right to do what he wants.”

The Hill Global Affairs blog noted the Senate reaction  to NWFIA :

Sens. Dick Durbin (D-Ill.), the second-highest ranking Democrat, Patty Murray (D-Wash.), the fourth-highest ranking Democrat, and Elizabeth Warren (D-Mass.) have said they are against the bill.

Senate Majority Leader Harry Reid (D-Nev.) has also suggested he’s leaning toward not allowing a vote on it.

On Wednesday, Sen. Marco Rubio (R-Fla.) said the Senate should move the sanctions bill forward to the floor, predicting it would have a veto-proof majority.

Meanwhile, Reuters reported on Monday that lawmakers in both the House and Senate are considering a nonbinding resolution that expresses concern about Iran’s nuclear program.

Backing what Sen. Kirk said in his response to the President was further evidence from former  UN nuclear weapons inspector David Albright at the Washington, DC Institute for Science and International Security (ISIS).  Both he and the sanctions analysis team from the Foundation for Defense of Democracies held a well attended briefing for Capitol Hill Staffers on Monday, January 27th.  Albright was quoted in the Los Angeles Times citing an ISIS  report on the technical aspects of the accord implemented on January 20th that allows Iran to continue research over the next six months on several types of advanced centrifuges already at Natanz:

[The accord]  is not expected to seriously affect Iran’s centrifuge research and development program. Albright said he hopes to persuade the six powers to push for much stricter limits on centrifuge research and development when they negotiate the final agreement. The issue has to be addressed much more aggressively.

Cliff May of FDD, co-sponsor of the Capitol Hill event with Albright  of  ISIS,  observed in an NRO Corner article:

If Iran’s rulers faithfully comply with every commitment they have so far made, at the end of this six-month period, they will be about three months — instead of two months — away from breakout capacity.

Yesterday, at the annual conference of the  Institute for National Security studies (INSS)  at Tel Aviv University, there was a dialog between former CIA Director Gen. David Petreaus and Maj. Gen. Amos Yadlin,  former  IDF military intelligence chief.  The contrast between their positions on the Iran nuclear threat was most telling:

General (ret.) David Petraeus: The United States is war weary and suffers from a “Vietnam syndrome.” However, it still has major strategic capabilities, and President Obama will not hesitate to use force against Iran, if necessary.

Major General (ret.) Amos Yadlin: What keeps me awake at night is the Iranian issue. The Iranian nuclear program aspires to attain a nuclear capability. The only viable leverage – sanctions and a credible military threat – are weakening, and this is most worrisome. Also troubling: the status quo on the Palestinian issue is not favorable, and the relations with the United States are not on the same level as before – these must be restored.

If you are a gambler, which of the two former military leaders, would you bet on to make a decision in the sovereign national interests of Israel regarding a nuclear Iran?  I know who I would.

EDITORS NOTE: This column originally appeared on The New English Review.