Pilatus Bank owner found guilty of breaching U.S. sanctions on Iran

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Ali Sadr Hashemi Nejad

Ali Sadr Hashemi Nejad

Pilatus Bank owner Ali Sadr Hasheminejad has been convicted of breaching United States sanctions against Iran, after a two-week trial by jury.

With a judge yet to carry out sentencing, Hasheminejad was found guilty of five counts, the highest of which carries a 30-year prison sentence.

Hasheminejad, 40, is expected to appeal the conviction, which found him guilty of conspiracy to defraud the United States, conspiracy to violate the IEEPA sanctions against Iran, bank fraud, conspiracy to commit bank fraud, and money laundering. He was found not guilty of one count of conspiracy to commit money laundering.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, said Hasheminejad had been accused of using the US financial system to funnel over $115 million in payments from a construction project in Venezuela his father’s construction company was involved in, back to his family’s companies in Europe. The US Attorney insisted these violated sanctions against Iran because it benefitted Iranian individuals and entities, including the Iranian International Housing Company and its Iranian owner, Hasheminejad’s father Mohammad Sadr Hasheminejad.

“As the jury found, Ali Sadr Hasheminejad created a network of front companies and bank accounts to mask Iranian business dealings in Venezuela and evade U.S. sanctions. For years, Sadr used front companies in Switzerland, Turkey, and St. Kitts & Nevis to conceal the fact that $115 million in payments were really for his family business and relatives in Iran. Sadr’s conviction shows that U.S. economic sanctions against Iran are for real, and violators will be exposed and prosecuted,” Berman said.

Hasheminejad ran a private bank in Malta, which he had licensed in 2013, and which largely dealt with millions in reserves owned by the Azerbaijani ruling family and oligarchs.

His bank was implicated in the Egrant affair, when the late journalist Daphne Caruana Galizia claimed the bank had processed a $1 million payment from the Aliyevs of Azerbaijan to the wife of former prime minister Joseph Muscat. The allegation was disproven by a Maltese magisterial inquiry along with other allegations she made about Pilatus Bank, but by then the banks’ other dealings for Azerbaijan had come under the lens of financial investigators. When Hasheminejad was arrested in Dulles airport in the United States in February 2018, the Maltese financial regulator shut down the bank and started an investigation.

Hasheminejad was then accused of having taking steps to evade US economic sanctions by concealing the role of Iranian parties in US dollar payments sent through the US banking system, from the construction of housing units in Venezuela.

The project was led by Stratus Group, an Iranian conglomerate controlled by Hasheminejad and his family with international business operations in the construction, banking, and oil industries. In December 2006, Stratus Group incorporated a company in Tehran, which was then known as the Iranian International Housing Company (IIHC). IIHC built approximately 7,000 housing units in Venezuela in exchange for approximately $475 million.

Prosecutors said Hasheminejad used a St. Kitts and Nevis passports and a United Arab Emirates address to incorporate two front companies outside of Iran to receive U.S. dollar payments related to the project: Clarity Trade and Finance in Switzerland, and Stratus International Contracting in Turkey.

Hasheminejad then carried out international financial transactions using Clarity and Stratus Turkey in a manner that concealed the Iranian connection to the payments, in violation of U.S. economic sanctions.

“During that time, SADR took several steps to hide the Iranian beneficiaries of these funds, including changing the name of the Iranian International Housing Company to just the initials, IIHC; directing employees to take down websites and articles from the Internet; lying about the owners of the front companies when asked by the banks; and altering payment vouchers and backdating contracts in order to mislead banks about the source of the funds,” Berman said.

Hasheminejad directed the payments be routed through American banks to a Swiss bank, and finally to an offshore entity in St. Kitts & Nevis. Between 2011 and 2013, Hasheminejad’s front companies wired over $8.6 million directly into the United States, some of which were used to purchase property in California.

Source » maltatoday

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