By Nikola Krastev, RFE/RL
NEW YORK -- The U.S. Justice Department has
announced that it intends to seize a 40-percent share in a posh New York City
Prosecutors allege the share is owned by Bank Melli, an Iranian bank that is fully owned by the Iranian government. They have also frozen some $3.1 million in assets they say are held by a shell company representing the bank.
The Fifth Avenue skyscraper in question
U.S. law prohibits the Iranian government and
related bodies from doing business in the United States without a special
license. Washington dropped all diplomatic ties with Iran following its 1979
Bank Melli has gained additional notoriety among U.S. prosecutors because of its designation by the U.S. Treasury Department as a key funder of Iran's nuclear and ballistic missile programs.
U.S. officials have also alleged the bank finances Iran's Revolutionary Guard and its Quds Force, which has been linked to terrorist groups.
Prosecutors allege that a chain of e-mail messages dating back to 2003 establish a clear a link between Bank Melli and Assa Corporation, the company that officially holds the share of the Manhattan property.
The U.S. officials are claiming Assa is a shell company that for almost two decades has funneled the rental proceeds from the property to Iran via a parent company in the Channel Islands off the northern coast of France.
Total proceeds earned from the property have not been publicized. But it is alleged that Assa deposited more than $17 million in U.S. bank accounts between January 2000 and December 2007.
The case is part of efforts by the outgoing administration of George W. Bush to tighten its grip on financial networks it believes are used to support international terrorism and nuclear proliferation.
In a statement, the Treasury Department said: "This scheme to use a front company set up by Bank Melli -- a known proliferator -- to funnel money from the United States to Iran is yet another example of Iran's duplicity."
The owner of the remaining 60-percent share is the Alavi Foundation, a nonprofit charitable organization associated with the late shah of Iran.
The Alavi Foundation has faced frequent accusations that it, too, has links with the government in Tehran, although U.S. officials have never initiated legal action against it.
The 36-story Fifth Avenue building was constructed in 1978, in part with help from a $42-million loan from Bank Melli, then in its pre-revolutionary incarnation.
It is situated in one of the most expensive sections of Manhattan. Neighboring buildings include Rockefeller Center, the Museum of Modern Art, and St. Patrick's Cathedral.
The building is host to a number of high-profile tenants, including Citibank and the Charles Schwab brokerage.
Requests by RFE/RL to speak with the building manager were refused. Staff at the Iranian mission at the United Nations likewise refused to comment on the case.
The U.S. government case is a civil, rather than criminal, complaint. No suspects have been detained or accused of criminal wrongdoing.
According to U.S. law, Assa Corporation now has 55 days to respond to the charges. The case may take several years to settle.
... Payvand News - 12/27/08 ... --