Turkish businessman Zarrab arrested in US on fraud charges

U.S. prosecutor Preet Bharara, who has a reputation for prosecuting 100 Wall Street executives in 2014 before a historic settlement, also charged Zarrab’s employee, Kamelia Jamshidy, and Hossein Najafzadeh, a senior officer at a unit of Bank Mellat in Iran. 

The indictment was filed in federal court in Manhattan after Zarrab was arrested on March 19 in Miami and appeared in federal court there on March 21, when a federal magistrate judge ordered him detained.

Jamshidy and Najafzadeh, who are both Iranian nationals, remained at large. 

Bharara, Assistant Attorney General John Carlin and the Federal Bureau of Investigation’s (FBI) Diego Rodriguez said in the indictment the trio made hundreds of millions of dollars of transactions fraudulently on behalf of the Iranian government, seeking 75 years jail time for each. 

The arrest came two months after Iran emerged from years of economic isolation when world powers led by the United States and the European Union lifted crippling sanctions against the country in return for curbs on Tehran’s nuclear ambitions. 

Bharara said after the read-out of the indictment that the suspects “violated the sanctions on Iran and Iranian companies, laundering money worldwide.”

Rodriguez said the accusations should send a message to those who want to hide their “real partners.” 

The indictment cited Bank Mellat, the National Iranian Oil Company (NIOC), the Naftiran Intertrade Company Ltd. (NICO), the Naftiran Intertrade Company Sarl (“NICO Sarl”) and the Hong Kong Intertrade Company (HKICO), along with the contractor MAPNA Group, as companies that benefited from the fraud. 

Royal Holding A.Ş., the Durak Döviz Exchange, the Al Nafees Exchange, Royal Emerald Investments, Asi Kıymetli MadenlerTurizm, ECB Kuyumculuk and Güneş General Trading LLC were listed as Turkish companies linked to Zarrab. 

Zarrab previously attracted attention when he was detained for two months in Turkey. He was the prime suspect in a corruption and bribery scandal involving the government that went public on Dec. 17, 2013. 

The businessman was accused of being the ringleader of a money laundering and gold smuggling ring in Turkey that circumnavigated sanctions against Iran. The charges were dismissed after the prosecutors investigating case were accused by the ruling party and then-Prime Minister Recep Tayyip Erdoğan of plotting against the government and removed from their posts. 

Four former cabinet members, Economy Minister Zafer Çağlayan, Interior Minister Muahmmer Güler, European Union Minister Egemen Bağış and Urban Minister Erdoğan Bayraktar, were accused in the probe before they were acquitted. 

According to the U.S. indictment, Zarrab, a dual citizen of Turkey and Iran, owned and operated a network of companies in Turkey and in the United Arab Emirates, including Royal Holding A.Ş., which employed Jamshidy. 

The indictment said Zarrab, Jamshidy and Najafzadeh, a senior officer at Bank Mellat’s Mellat Exchange, conspired to thwart economic sanctions against Iran by concealing transactions benefiting Iran’s government and Iranian entities. 

Prosecutors said that from 2010 to 2015, the trio helped Iranian individuals and entities, including Bank Mellat, one of the largest banks in Iran, evade U.S. sanctions by conducting financial transactions through Turkish and Emirati companies.