It has been no secret to the international community that the government in Iran was heavily involved in supporting the Assad regime in Syria. Many have held similar suspicions of Tehran's influence over the Erdogan administration in Turkey, another Middle Eastern country with a messy relationship with its neighbors and the rest of the international community.
Now, new evidence has shown that a Turkish gold trader, Reza Zarrab, AKA Riza Sarraf, has been helping the Iranian regime circumvent international economic sanctions by conducting business on behalf of Iranian companies, often using gold to facilitate the transactions.
Sordid Sanctions Scandal
Zarrab operated a dense network of companies in Turkey and the United Arab Emirates, according to Bloomberg, in order to carry out business with the United States and other countries. Unwittingly, these countries were in fact dealing with Iranian interests that were otherwise barred from doing normal business overseas due to sanctions. Hence the need for Zarrab and his network to serve as intermediaries.
The fraud took place between 2010 and 2015 (since these sanctions have since been lifted by the atrocious nuclear deal agreed to by the Obama administration). In many cases, it involved the bribery of important government officials and other bureaucrats. This all but proves that the Erdogan administration was up to its eyes in corruption, as many have alleged. At the time, the massive amounts of dirty money being accumulated from the clandestine Iran trade was merely characterized by authorities as "philanthropy."
Naturally, Mr. Zarrab was showered with praise and awards by the Turkish government for growing the country's "export" (read: illicit) business. Former Economic Minister Nihat Zeybekci and current Deputy Prime Minister Numan Kurtulmus presented Zarrab with an award recognizing him for "export performance" in June of last year, as reported by Bloomberg.
Moreover, in a nationally televised interview in the Spring of 2014, "Zarrab estimated he had facilitated the transfer of about $12 billion in gold, or about 200 [metric] tons, to Iran. The surge in exports driven by that business was so rapid and so extensive—gold transfers to Iran jumped from $53 million in 2011 to $6.5 billion in 2012—that it distorted Turkish trade figures."
This narrative fits in perfectly with the suspicions that Iran was using a similar scheme involving gold payments to facilitate the sale of its oil to Turkey and Russia. For his dutiful service, Zarrab could boast a marriage with one of Turkey's most famous pop stars; a $72-million waterfront villa in Istanbul; as well as a personal yacht and private jet.
Finally, Zarrab was arrested in Miami earlier this week. The 33-year-old is charged with conspiracy to commit bank fraud, money laundering, and sanctions evasion, all of which could land him a maximum penalty of 30 years in prison. The U.S. Attorney's Office for the Southern District of New York will try the case.
Oddly enough, Erdogan is scheduled to be visiting the U.S. between March 29th and April 2nd.
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