The Justice Department announced the unsealing of three federal cases, across two U.S. Attorneys’ Offices, as the most recent in a series of efforts to combat the illicit trafficking of Iranian oil that funds Iran’s Islamic Revolutionary Guard Corps (IRGC), a designated Foreign Terrorist Organization (FTO), and its Qods Force (IRGC-QF), Iran’s primary mechanism for cultivating and providing lethal support to terrorist organizations abroad.
In the Southern District of New York, seven defendants, including a leader within Iran’s IRGC and officers of a Turkish energy group, are charged with terrorism, sanctions-evasion, fraud, and money laundering offenses in connection with their trafficking and selling of Iranian oil to government-affiliated buyers in China, Russia, and Syria, in order to finance the IRGC-QF. Additionally, the United States seized $108 million used as part of these defendants’ scheme to fund the IRGC-QF.
In a related action, in the District of Columbia, a Chinese woman and Omani man are charged with sanctions-evasion and money laundering offenses in connection with the trafficking and selling of Iranian oil to Chinese government-owned refineries. Additionally, in the District of Columbia, a forfeiture complaint for the seizure of illicit Iranian oil was unsealed, alleging that more than 500,000 barrels of Iranian fuel is forfeitable under terrorism laws as property that provides a source of funding to the IRGC and IRGC-QF.
“Today’s cases are part of the Department’s ongoing efforts to cut off the flow of black-market Iranian oil that funds the regime’s malign activity, threatening the United States and our interests around the world,” said Assistant Attorney General Matthew G. Olsen of the Justice Department’s National Security Division. “We remain focused on holding accountable those involved in these smuggling schemes, from the officials who oversee the laundering operations, to the network of shadowy businesses that enable them, to the brokers who help facilitate these unlawful transactions.”
Seven defendants – including a senior IRGC-QF official, the son of Rostam Ghasemi, a former IRGC Commander and Iranian Minister of Petroleum, an Iranian shipping official, an agent of the IRGC-QF – are charged in a five-count indictment unsealed today in Manhattan federal court. In connection with these charges, the United States has seized $108 million that China Oil & Petrolium Company Limited, an IRGC front company, attempted to launder through correspondent transaction accounts at U.S. financial institutions in furtherance of the scheme to fund the IRGC-QF’s malign activities through the illicit sale of Iranian oil. In addition, the Department of Treasury’s Office of Foreign Asset Controls (OFAC) announced today that it has sanctioned China Oil & Petroleum Company Limited for its role in the oil trafficking network.
“For years, the IRGC and its Qods Force have been instrumental in the Iranian regime’s violent suppression of political dissent, targeting of Iranian dissidents living abroad, and support of international terrorism — including groups like Hamas, Hizballah, and Palestinian Islamic Jihad. Today’s charges show how, as alleged, the IRGC’s Qods force built a sprawling international network of front companies to launder sanctioned Iranian oil using lies, forgery, and threats of violence,” said U.S. Attorney Damian Williams for the Southern District of New York. “This alleged scheme to finance the Qods Force succeeds through the complicity of wealthy businessmen in countries like Turkey who are eager to turn a corrupt profit from supporting terror groups. The Qods Force oil-laundering network allegedly delivered millions of barrels of Iranian oil to government-affiliated buyers in Russia, China, and Syria, and transferred billions of dollars through the U.S. financial system. This office has long served at the forefront of law enforcement efforts to fight terrorism and terror finance and to protect the integrity of the U.S. banking system. I commend the tireless and outstanding efforts of our law enforcement partners in unraveling and disrupting the IRGC’s scheme.”
The indictment charges:
According to the indictment, following the imposition of U.S. sanctions against Iran’s petroleum sector in 2018, the Government of Iran’s ability to finance itself through sales of crude oil and petroleum products – Iran’s most important economic sector – was severely diminished. In response, the IRGC-QF built a large-scale global oil laundering network to give Iran’s government-owned National Iranian Oil Company (NIOC) illicit access to global markets to sell crude oil and petroleum products and to use the proceeds to finance the IRGC-QF.
To sell NIOC crude oil to the regime of Bashar al-Assad in Syria, the network used an intermediary company in Lebanon to conceal the Government of Iran’s involvement in the oil sales and a ship management company based in India to buy, lease, and manage oil tankers to use in the scheme. The oil tanker fleet was supervised by Aliakbari, and the key agreements between the Government of Iran and its foreign partners were authorized and approved by IRGC-QF Commander Rostam Ghasemi, who previously served as Iran’s Minister of Oil, Minister of Transportation and Urban Development, and the Iranian chair of the Iranian-Syrian Economic Relations Development Committee.
To sell NIOC crude oil to government-affiliated buyers in China, the network used the ASB Group of companies in Turkey, owned by Sitki Ayan, as well as intermediary companies in Oman, Greece, and elsewhere. Commander Ghasemi again authorized and approved key agreements between the Government of Iran and its foreign partners and resolved financial disputes that arose among the participants in the scheme. Companies in the ASB Group acted as intermediaries in the oil sales to conceal the Government of Iran’s role and the Iranian origin of the oil and leased oil tankers that were operated by co-conspirators. Sitki Ayan’s son and senior ASB Group officer, Bahaddin Ayan, assisted Sitki Ayan in the scheme and caused millions of dollars of wire transfers through the U.S. banking system for the leasing and operation of oil tankers. Oztas, who was a manager of the ASB Group of companies, also assisted Sitki Ayan in carrying out the scheme and finalizing agreements with ASB Group’s partners. Shahriyari, Karimian, and Aliakbari participated in negotiations among the participants and monitored the progress of the oil sales, oil shipments, and the IRGC-QF’s receipt of the oil proceeds.
To sell NIOC crude oil to government-affiliated buyers in Russia, the network again used the ASB Group of companies, along with other companies in the United Arab Emirites, Cyprus, Russia, and Turkey. Shahriyari and Karimian organized a complex web of companies, with Sitki Ayan’s ASB Group of companies at the center, to launder NIOC oil and the proceeds through layered transactions with a Cypriot company and to launder the oil sales through bulk cash smuggling and trade-based money laundering involving Russian agricultural products. Commander Ghasemi and his co-conspirators, including Karimian, controlled the proceeds of the oil sales, which were collected in Russia and transferred through cash couriers, Sitki Ayan’s companies, or the Iranian Embassy in Moscow.
In furtherance of the oil-laundering scheme, the defendants used a myriad of deceptive techniques including: 1) the use of front companies and intermediaries in countries outside of Iran to disguise the IRGC’s role in the oil transactions and the Iranian source of the oil; 2) the use of falsified documentation to misrepresent the source of the oil and deceive unwitting companies and banks and cause them to provide services in furtherance of the scheme; and 3) the use of ship-to-ship transfers and the manipulation of location and shipping data for vessels used in furtherance of the scheme in order to obscure the loading and unloading of their Iranian oil cargoes and avoid the identification of the vessels used to facilitate the oil laundering.
One of the key IRGC-QF front companies involved in the scheme was China Oil and Petroleum Company Limited (China Oil and Petroleum), which, despite its name, was controlled from Iran by Commander Ghasemi and his associates, including Karimian. China Oil and Petroleum acted as an intermediary in sales of NIOC oil, including deals involving Sitki Ayan’s ASB Group of companies, in order to facilitate the ultimate delivery to government-affiliated buyers in China. Between at least 2019 and the present, China Oil and Petroleum has been involved in the transfer of more than $2 billion through the U.S. financial system in furtherance of the scheme to finance the IRGC-QF.
Each of the defendants is charged with: (i) conspiring to provide material support to a designated foreign terrorist organization, which carries a maximum sentence of 20 years in prison; (ii) conspiring to violate the International Emergency Economic Powers Act and sanctions against the Governments of Iran and Syria, global terrorists and proliferators of weapons of mass destruction, which carries a maximum sentence of 20 years in prison; (iii) conspiring to commit bank and wire fraud, which carries a maximum sentence of 30 years in prison; (iv) conspiring to commit money laundering, which carries a maximum sentence of 20 years in prison; and (v) conspiring to defraud the United States, which carries a maximum sentence of five years in prison.
Two defendants – Shaoyun Wang, 54, of China, and Mahmood Rashid Amur Al Habsi, 39, of Muscat, Oman – are charged in a 12-count indictment that was unsealed today in the District of Colombia. The indictment charges the defendants with violating the International Emergency Economic Powers Act and sanctions against Iran; conspiracy to commit money laundering, and money laundering stemming from their scheme to sell Iranian petroleum to Chinese government-owned refineries and illegally use the U.S. financial system to facilitate the sale of hundreds of millions of dollars’ worth of oil to benefit the IRGC. Also unsealed today was a warrant for a related seizure of $8.5 million connected to this network.
“The only way that Iran can illegally sell oil is if people and business organizations outside Iran help it to do so,” said U.S. Attorney Matthew M. Graves for the District of Columbia. “The indictment unsealed today demonstrates that the U.S. government will seek to hold accountable those who knowingly help Iran illegally sell oil – wherever in the world they are located.”
According to the indictment, between December 2019 and July 2021, Wang, Al Habsi, and other co-conspirators negotiated the sale of and sold illicit Iranian oil to the People’s Republic of China (PRC). They allegedly obtained the oil from Iran using surreptitious means which included AIS spoofing and multiple transfers between ocean-going tankers. The scheme relied on the use of the U.S. financial system and was facilitated by Turkish, Omani, and U.S. persons and entities, all in violation of U.S. sanctions against Iran.
The indictment further alleges that Wang and Al Habsi created fraudulent documents to mask that the oil originated from Iran, used electronic communications to arrange for Chinese buyers of the Iranian oil, used shell corporations to launder the proceeds through the U.S. financial system and provided false information to the U.S. companies about the source of the money generated by the transactions. In addition, the defendants used U.S. companies as a “trust” to hold the profits for the IRGC.
Al Habsi, acting through one of his companies, procured a $16.5 million loan in June 2020 from U.S. financial companies to purchase an oil tanker, later named M/T Oman Pride. Beginning in July 2020, the Oman Pride transported Iranian oil, which was ultimately transferred to third-party vessels for sale to Chinese government-owned refineries and companies in China.
As alleged, Wang used a U.S. front company, worked with a U.S. person, and relied on U.S. financial institutions to facilitate the sale of the Iranian oil to China. Wang – who served as a director of a Chinese oil refinery – was also the chair of a U.S. company in Las Vegas, Nevada, and general manager of the U.S. company’s Hong Kong-based parent company. The Hong Kong company acted as a front for transactions. Wang engaged with senior IRGC officials to effect the purchases. The scheme resulted in millions of dollars’ worth of transactions that were processed by U.S. banks and facilitated by U.S. persons.
A civil forfeiture complaint was unsealed January 31 in the District of Columbia, alleging that more than 500,000 barrels of Iranian fuel oil valued at over $25 million previously onboard M/T Abyss is forfeitable under terrorism laws as property that provides a source of funds to the IRGC and IRGC-QF.
“The complaint unsealed today is the latest in a series of actions our Office has taken to seize and to forfeit oil that Iran has attempted to illegally sell,” said U.S. Attorney Matthew M. Graves for the District of Columbia. “Forfeiture actions like this one disrupt Iran’s efforts to illegally sell oil. The proceeds from these illegal sales are the lifeblood of the Iranian’s efforts to sew war and terror around the globe, disrupting these sales is critical to our national security.”
The document alleges a scheme to facilitate the shipment and sale of Iranian fuel oil for the benefit of the IRGC and the IRGC-QF. The IRGC and its facilitators used deceptive practices to masquerade the oil as Iraqi, including manipulating the vessel’s automatic identification system reporting and presenting falsified documents.
The civil forfeiture action further alleges that the fuel oil constitutes the property of the NIOC, which has provided material support to the IRGC and IRGC-QF. As alleged, profits from petroleum product sales support the IRGC’s full range of malign activities, including the proliferation of weapons of mass destruction and their means of delivery, support for terrorism, and both domestic and international human rights abuses.
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