Iranian company indicted in NY for evading sanctions

The IRISL used false companies to dupe NY-based banks into processing wire payments totaling more than $60 million.

June 20, 2011 21:57
2 minute read.
Iranian ballisitic missile launched at war game.

Iranian ballistic missile_311 reuters. (photo credit: Ho New / Reuters)

NEW YORK - Prosecutors in New York on Monday indicted an Iranian shipping company for setting up shell companies so that it could evade sanctions and move millions of dollars through the US financial system.

The Manhattan district attorney's office said the state-sponsored Islamic Republic of Iran Shipping Lines, known as IRISL, used bogus companies to dupe New York-based banks into processing wire payments totaling more than $60 million.

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An indictment filed in state court charged the company, which has major shipping centers in Singapore, the United Kingdom, and the United Arab Emirates, with conspiracy and falsifying business records. Fifteen other defendants are named in the 317-count indictment.

The charges capped a 14-month investigation by Manhattan District Attorney Cyrus Vance and the US Department of Treasury, which had sanctioned IRISL in 2008 for its role in aiding Iran's ballistic missile development program.

"The point of this indictment is that sanctions exist and they've been in place for a number of years," Vance said. "To make sanctions work they have to be enforced."

The indictment accused the defendants of illegally moving more than $60 million through correspondent bank accounts at Manhattan-domiciled banks from September 2008 to January 2011.

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The nine banks the Iranian company used to funnel funds include Deutsche Bank Trust Company Americas, JP Morgan Chase & Co., the Bank of New York Mellon Corporation, Wells Fargo Bank, N.A. and the Royal Bank of Scotland. Vance said none of the banks is accused of any wrongdoing.

Also on Monday, the US Treasury said it had imposed sanctions on many of the same defendants, who it said have ties to IRISL.

The shipping company is Iran's main national carrier and has been "the carrier of choice" for weapon-procurement activities, according to Adam Kaufmann of the district attorney's office. The company engaged in "persistent efforts to deceive and misrepresent its activities in order to evade international and US sanctions," Kaufmann said.

Vance acknowledged that the case was not certain to be prosecuted in New York. "Will anyone ever face judgment in New York for these charges and this indictment?" he asked. "Possibly."

Still, he said, the district attorney has "a responsibility ... to protect our banking community in New York state."

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