Iran Sentences Four to Death Over $2.6 Billion Bank Fraud

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In the first sentences to be handed down in a $2.6 billion embezzlement case, an Iranian court ordered the death penalty for four people in the fraud that was uncovered in a network of Iranian banks last year, Iranian state media reported on Monday.

The four, who were not named in the report by the Fars news agency, were among 39 suspects who were convicted in what the Iranian authorities have described as the biggest financial swindle in the country's history. The top prosecutor, Gholam Hossein Mohseni-Ejei, told reporters that two of the defendants had been given life sentences, while the others were given sentences of up to 25 years.

The first signs of the widespread embezzlement were uncovered in September 2011, at Bank Melli, Iran's largest commercial bank, and culminated in the trial, which started in February. As the scandal unfolded, the authorities said it expanded to involve forged documents that were used to obtain credit from at least seven Iranian state and private banks. The money was used over a four-year period to buy state-owned companies, they said.

The case had political significance for Iran's president, Mahmoud Ahmadinejad, whose conservative opponents in Parliament tried to tie his chief of staff, Esfandiar Rahim Mashai, and other associates to the main suspect, Amir-Mansour Khosravi, a businessman who owns at least 35 companies. Mr. Mohseni-Ejei has said that Mr. Khosravi confessed while in custody and started cooperating with the authorities.

The other suspects were not named, but have been said to include managers of bank branches, and a number of clerks who were accused of accepting bribes. Fars quoted Mr. Mohseni-Ejei as saying that the other sentences that were handed down included prison terms of 10 and 20 years, as well as lighter sentences.

Fars reported that the Iranian authorities have requested that Canada repatriate a suspect in the case, Mahmoud Reza Khavari, the former managing director of Bank Melli, who fled to that country in September when the scandal first broke. Iran does not have an extradition treaty with Canada, where Mr. Khavari has held dual citizenship since 2005 and has a home.

The Iranian media previously reported that Mr. Khavari resigned in a letter addressed to Iran's finance minister, Shamseddin Hosseini, last year, in which he asked for forgiveness from the Iranian supreme leader, Ayatollah Ali Khamenei. Mr. Hosseini, an ally of the Iranian president, accepted the resignation, but has come under criticism himself as the time frame in the case coincided with his tenure.

world

This article originally appeared in The New York Times.


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