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Iran’s Shadow Money Destabilizes the World

In the West, the Islamic regime of Iran is largely criticized as a terrorist state, which brutalizes its own people, chants “Death to America” and “Death to Israel” and which sponsors terror groups abroad. But Iranians of all types commonly mention a further reason that they abhor the regime—it steals their money, to fund that terror.

And the regime is so blatant about it, that its money laundering is no secret. In fact, there are critics of the practice even inside the ranks of the regime. “Widespread Money Laundering Is a Fact in the Kleptocratic Regime,” says Mohammad Javad Zarif, who has been Iran’s Foreign Minister since 2013.

The Islamic regime of Iran has seemed to glide along with its endless terror sponsorship in the Middle East and beyond. But how does the regime also commit such large-scale financial crimes, and nobody does anything against it?

To fuel its Islamic Revolutionary ideology, the Khomeinist regime certainly has a strong drive to fund its proxies, the militants who continue malicious assaults in the region. The money has come from both legal and illegal sources. Iran’s Mullahs allocate astronomical amounts of money to the cause.

Investigators have been tracking the release of information and details about money laundering by the Iranian regime for years. The evidence is overwhelming that the regime spends all the money it can get its hands on to destabilize the region, and not to boost the lives of its citizens. The only sensible conclusion is that all of the regime's revenue (legal and illegal) should be cut off, as effectively as possible.

Sanctions against the kleptocratic regime have worked well but have not gone far enough. The sanctions have targeted those entities or persons who are directly involved in regime’s money circle. But other ways get opened once the current paths are disconnected.

Thousands of people and hundreds of entities are working for the regime to carry out its money laundering. Reza Zarrab, Marjan Sheikholeslami Aleagha, and Babak Zanjani are three key persons whose activities with money laundering, embezzlement, and money corruption have been mentioned in connection with the regime. Sasha Sobhani, son of Iran's former ambassador to Venezuela, is another who has been named in the matter.

The Mullahs continue to engage in their hideous activities despite sanctions that have targeted many of regime’s financial arms. The regime deploys a range of methods to extract money— from illegal and semi-legal avenues, unofficial economic arrangements, exploitation of inefficiencies in official channels, and undeveloped financial markets, which allow them to bypass international rules through concealment of the origins of illegally obtained money.

The entertainment industry and the sex-trade are examples that can easily be used for money laundering. Corruption involving banks, lawyers, electoral campaigns, charities, or loosely-monitored human rights agencies, can all become avenues to circumvent financial laws and restrictions. Money laundering also occurs by goods being purchased in different countries, and then sold in another country. Repeating such actions numerous times helps to conceal the origins of dirty money.

The regime's money launderers use these different methods and more to finally merge the money into legal financial systems by which they can then stockpile it.

In the case of the Islamic regime of Iran, these actions are done on an industrial scale, involving billions of dollars. The IRGC, IRGC-Quds Force, Hezbollah, Popular Mobilization Forces, Liwa Fatemiyoun, Liwa Abu al-Fadhal al-Abbas, Badr Organization, Liwa Zainebiyoun, Liwa Zulfiqar, Asa'ib Ahl al-Haq, Saraya Al Salam, Saraya al-Khorasani, Kata'ib Hezbollah, Kata'ib al-Imam Ali, Kata'ib Sayyid al-Shuhada, and Harakat Hezbollah al-Nujaba are the many regime arms and proxies involved in the money laundering loop.

And the activity goes on around the world. Central Asia, Southeast Asia, North and South America, the Persian Gulf states and some European countries are common dens for money laundering by the Islamic regime. They engage a shadow banking system, a group of financial intermediaries facilitating the creation of credit across the global financial system, but whose members are not subject to regulatory oversight.

In one example, Reza Zarrab, who has pleaded guilty and is cooperating with U.S. prosecutors in the criminal trial of a Turkish bank executive, told jurors in federal court in Manhattan that he helped Iran use funds deposited in Turkey’s state-owned Halkbank to buy gold, which was smuggled to Dubai and sold for cash.

All of this makes another good argument for bringing regime change to Iran. The West can benefit by it as much as the Iranian people will. As long as the kleptocrat regime remains in power, western resources will be consumed in trying to police such shadow money, as it gets massively laundered on a nationwide scale. Regime change will bring a much cleaner financial condition to the world, as well as remove the terror proxies that Iran funds. Until then, the West can do a better job of tightening sanctions and catching the key money laundering bag men. Follow the money, and cut the terror funding ties.

 

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