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Iran Says 22 of 37 Suspects Held in $2.6 Billion Fraud Case

October 04, 2011

(Updates with accusations against the president in fifth paragraph, lawmakers’ letter in sixth, seventh.)

Oct. 4 (Bloomberg) -- Iran’s judiciary said it detained 22 of 37 suspects sought in connection with a $2.6 billion banking fraud as lawmakers called for an inquiry to determine whether government officials were involved in the alleged crimes.

The prime suspects have been sent to a Tehran prison from the southwestern city of Ahvaz pending further investigation, Prosecutor General Golamhossien Mohseni-Ejei said in an interview with state television without identifying them.

Amir Mansour Aria Development Co. and affiliated companies linked to the family of businessman Amir Mansour Khosravi are the main entities suspected of involvement in the scam, Mohseni- Ejei said late yesterday. Seven state and private banks are linked to the fraud, which involved forging of letters of credit from Bank Saderat, which is partly state-owned, to secure loans that were used to buy state-owned companies, Iranian media said. Some of the money was transferred offshore, Mohseni-Ejei said.

President Mahmoud Ahmadinejad, who campaigned against corruption before taking office in 2005, has come under pressure as critics accuse his close aide and relative, Esfandiar Rahim Mashaei, of having ties to Khosravi. The government has denied any connection to the alleged fraud.

Eleven members of parliament called on the legislature’s speaker, Ali Larijani, to look into “transgressions” of the law by top officials, including Ahmadinejad, Central Bank Governor Mahmoud Bahmani and Economy and Finance Minister Shamseddin Hosseini, the state-run Mehr news agency reported.

‘Blow’ to Trust

Preliminary reviews show that “certain officials from the executive branch have provided support in contravention of laws and some bank officials have failed to oversee transactions,” the deputies wrote in a letter to Larijani published by Mehr.

“The recent financial scandal has delivered a blow to people’s trust in the country’s banking and management system,” the signatories said. “The unbiased and precise review of this disgrace and an announcement of the results to the people will decrease the level of mistrust.”

--Editors: Ben Holland, Andrew J. Barden, Heather Langan, Andrew Atkinson

To contact the reporters on this story: Vivian Salama in Abu Dhabi at; Ladane Nasseri in Dubai at

To contact the editor responsible for this story: Andrew J. Barden at

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