Posts Tagged ‘corruption’

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Iranian billionaire sanctions evader on trial

October 8, 2015

Even leaving aside the terrorist financing and sanctions evasion, Iran’s financial system is as clean as a sewer.  Assets unfrozen by the Iranian nuclear deal aren’t only at risk of being used for nefarious purposes, but are also at risk for theft, mismanagement, and to worsen the corruption of endemic to the Iranian regime and its associates abroad.  This trial in Turkey helps illustrate that point.  From Today’s Zaman:

Iran may confiscate Zanjani’s assets in Turkey-linked graft case

All assets belonging to Babak Zanjani — supposedly the richest businessman in Iran who also has alleged ties with the prime figure in Turkey‘s graft scandal — might be confiscated, as sought in the indictment of his trial, known as the biggest corruption case in Iran’s recent history.

The Turkish daily Hürriyet reported on Monday the third session of the first hearing into Zanjani’s trial, which started on Oct. 3, and cited the Tehran deputy chief prosecutor who continued to be the reader of the 237-page indictment following the first and second sessions that were held on Saturday and Sunday.

While referring to the charges against Zanjani — which are mainly charges of fraud, money laundering and corruption both within Iran and in several other countries, including in Turkey — the deputy chief prosecutor said, “I [therefore] demand the confiscation of all of the defendant’s assets in Iran and other countries, including those assets that have been fraudulently transferred to his associates, in the national interests of the Islamic Republic of Iran.”

Zanjani, believed to be the richest man in Iran who has reportedly $14 billion in assets, is known for helping the Iranian government evade the Western sanctions that were imposed on the country over its disputed nuclear program.

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New book: Danish company paid off imams

April 7, 2014

Arla, the Scandinavian dairy conglomerate, paid a “significant amount” of money to Gulf state imams in 2006 in exchange for a fatwa declaring Arla’s products halal.

The deal was struck in the aftermath of violent protests that followed Jyllands-Posten’s publication of cartoons depicting Muhammad. Ahmed Akkari, a Danish Muslim who originally helped inflame the “Cartoon Crisis,” makes these allegations in his new book, Min afsked fra Islamism (My departure from Islamism).

The Danish website Metroxpress explained the deal recounted in the book, in which Arla “would donate a substantial sum for a purpose of the [Islamic] scholars’ choice. In return, they would [issue] a statement saying that it is now again religiously acceptable to buy the Danish, Swedish and Norwegian dairy products.”

In other words, the scholars would bless off on Arla products in Bahrain and the UAE and help simmer down the anti-Danish sentiments that they themselves had whipped up about the cartoons in exchange for what was likely millions of Danish crowns to be spent as the imams saw fit.

The 2006 agreement may have been a violation of Denmark’s anti-corruption and anti-bribery laws. Section 299 of the Danish Criminal Code prohibits bribes among private entities in exchange for a “return commission” (ie, kickback). In this case, the return commission for the money paid to the imams was the profits earned from sales stemming from their endorsement of Arla’s products, thus giving Arla an unfair advantage in the Middle East over its competitors who did not arrange similar off-the-books payments there.

For its part, the Arla conglomerate has been arrogant and dismissive about the seriousness of the new allegations, saying that “We have decided to put the matter behind us,” and that Arla will not comment further events from eight years ago.

The cavalier attitude expressed by Arla may be indicative of the broader Danish attitude toward corporate bribery overseas. Denmark, which by most measures has very little corruption, was admonished last year by the OECD for its failure to do more to investigate allegations of foreign bribery. Danish companies were previously revealed to have paid bribes to Saddam Hussein regime officials as part of the scandal plagued UN oil-for-food program.

The 2006 agreement could also be viewed as simple extortion by the Islamic scholars. There would be a precedent for that as well:  shakedowns for halal certification against Denmark by Saudi Arabia’s Muslim World League were revealed last year. The Gulf monarchies and their elites seem to have realized that Danish companies are rather pliant to their demands.

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Backroom deal suspected as Turkish agent buys foreclosed Gulen school property

April 6, 2013

In 2012, the Atlanta-area Fulton Science Academy (FSA) borrowed $19 million to buy land to expand their campus.  FSA quickly defaulted, and Wells Fargo sued them.  On Feb. 5, the land was sold at a foreclosure auction for $3.2 million according to the Atlanta Journal-Constitution:

Foreclosure auction of Fulton Science Academy property

The winning bidder?  A recently incorporated company called “TruGlobe,” with three Turkish officers, who were somehow able to come up with over $3 million on the day of the foreclosure sale, at which cash or cashier’s checks are normally required as immediate payment.

Both the Fulton Science Academy and TruGlobe have addresses in Alpharetta, Georgia.  The similarities between the entities indicate probable collusion between the Gulen charter school and the winning bidder prior to the sale.  It is worth noting that bid rigging at foreclosure auctions is a growth area for criminal activity.

The website Roots in Alpharetta was the first to expose the “amazing coincidence” of the buyer’s Turkish identity:

Did a Fulton Science Academy benefactor purchase their land?

February 6, 2013

Has a Fulton Science Academy benefactor swooped in to save the embattled school’s construction project? Perhaps.

FSA’s stalled construction project off Westside Parkway was sold in a foreclosure auction this past Tuesday. WSBtv reported this week via twitter that a firm by the name of TruGlobe Inc purchased the land on the courthouse steps for $3.2 million.

TruGlobe is based here in Alpharetta, according to records at the Georgia Secretary of State’s office. Principals with the company appear to be of Turkish descent and have ties to the Turkish American Chamber of Commerce.

Or it could all be an amazing coincidence. This blogger bets that the FSA will pursue a new state charter and attempt to revive their plans for new campus.

Indeed, the registered agent and chief financial officer of TruGlobe is listed as Ahmed Vehbi Ugur, a young man who describes himself as a board member of the Turkish American Chamber of Commerce of the Southeast.  Ugur is also registered as the CEO of the Maress Corporation, a Turkish kitchen appliance business with an Atlanta office.

The Fulton Science Academy belongs to a network of troublesome charter schools under the direction of Fethullah Gulen, an activist who seeks to replace the formally secular government in Turkey with a sharia-dominated Islamic caliphate.  Gulen schools have undertaken an influence peddling and crony contract scheme in Texas, improper financial activities in Georgia, were denied a charter in Virginia, and are currently under an FBI investigation for kickbacks.

Fulton County itself has recommended early revocation of FSA’s charter due to educational and financial shortcomings.  The State Board of Education of Georgia may consider such a suspension when it meets this month.

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UPDATE—April 8, 2013:  A colleague has noted that the Turkish parties in this case appear to have acquired a $19 million property for a fire sale price of $3 million, short-changing Wells Fargo and the Development Authority of Alpharetta by $16 million in the process.

Technically, the full $19 million debt owed by Fulton Science Academy has not been extinguished by the foreclosure sale to TruGlobe.  Wells Fargo could have pursued a confirmation of deficiency proceeding against FSA for the $16 million still owed.  However, Read the rest of this entry ?

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Index reveals corruption rife in Islamic world

August 13, 2012

When we post articles about financial crimes, corruption, graft, bribery, and theft in predominantly Muslim nations, we are sometimes told that we’re being biased, because corruption is a “global” or a “third world” problem.

Of course corruption is universal, but we shouldn’t just through our hands up in the air and say, “everybody does it,” and willfully ignore where it is the biggest problem.  Any suggestion that there may be a correlation between such activity and religion or culture is immediately dismissed as “racist,” “Islamophobic,” etc.

But shouldn’t we at least look at the evidence?  Transparency International’s annual corruption index provides some insight.  Their list is based on “surveys and assessments [that] include questions related to the bribery of public officials, kickbacks in public procurement, embezzlement of public funds, and the effectiveness of public sector anti-corruption efforts.”

Notice that of TI’s top 10 cleanest nations–those perceived to have the smallest levels of public corruption–nine are predominantly Christian while one, Singapore, is plurality Buddhist:

  1. New Zealand
  2. Denmark
  3. Finland
  4. Sweden
  5. Singapore
  6. Norway
  7. Netherlands
  8. Australia
  9. Switzerland
  10. Canada

Further notice that of the worst 10 countries, six are majority Muslim, with North Korea and Somalia coming in last out of 182 countries rated:

173.  Venezuela
174.  Haiti
175.  Iraq
176. Sudan
177. Turkmenistan
178. Uzbekistan
179. Afghanistan
180. Myanmar
181. North Korea
182. Somalia

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Khums is haram, goes into toilet

September 30, 2011

A rather surprising video was uploaded on Sep. 14 to Youtube showing Shia Iraqi scholar Sayyid Ahmed al Qabbanji blasting Iranian leaders on how they use their revenues from the khums tax:

Al Qabbanji is right that the Iranian clerics have become stinking rich taking money from their people (both through religious taxation and government corruption).  He goes as far as to call khums not obligatory, but haram, and that giving khums is like flushing “a million in the toilet.”

Still, given the choice, I’d rather the ayatollahs travel to London and spend khums on hotels and shopping sprees versus diverting the money toward Hezbollah, which is one of the terrorist organization’s key revenue sources.

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Weekly word: PEP

September 14, 2011

Admittedly, it’s been a lot longer than a week since our last effort at defining terms related to the money jihad.

This latest addition to the glossary will be “politically exposed person” (PEP):

PEPs are individuals who are or have been entrusted with prominent public functions in a foreign country, such as heads of state or government; senior politicians and party officials; senior executive, judicial, or military officials; and senior executives of state-owned corporations.*

PEPs normally include family members of government officials, but do not normally include low or mid-level government officials.

Being able to identify and screen PEPs can help prevent the transfer of ill-gotten funds from, for example, corrupt politicians to banks overseas.  But that is easier said than done.

In August, MoneyLaundering.com reported:

Three intergovernmental groups are questioning the effectiveness of anti-money laundering controls meant to curb abuses of corrupt political figures who steal from their countries.

The World Bank and United Nations said in a joint June 21 report that at least 74 of 124 jurisdictions examined have not complied with anti-money laundering (AML) recommendations to quash kleptocracy by political figures. The record indicates that financial institutions and the agencies that regulate them may be “deficient” in enforcing the controls, the report said.

In a separate report published July 29, the Paris-based Financial Action Task Force (FATF) warned banks and other companies that government officials, also known as politically exposed persons (PEPs), can exploit the “natural advantages” of their positions to launder ill-gotten funds through institutions, and then stymie investigations into the crimes.

The three organizations recommended requiring financial institutions to review their PEP accounts annually, sharing suspicious activity reports on the accounts of foreign politically-tied figures with their home country and eliminating the distinction between foreign and domestic PEPs.

The questionable effectiveness of PEP screening sheds further doubt on the world’s approach to preventing money laundering and terrorist financing.

The PEP concept is particularly relevant during the Arab Spring, where rulers like Muamar “Daffy” Qaddafi, Bashar “Butcher” al-Assad, Hosni Mubarak, and other leading thugs are being accused of holding secret bank accounts of wealth stolen from their people.

* World Bank, Combating money laundering and the financing of terrorism:
a comprehensive training guide, Volume 3, Part 1 (Washington D.C.:  World Bank Publications, 2009).

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Abbas stole $1.3 billion, says Dahlan

August 31, 2011

Mahmoud Abbas (code name: Abu Mazen) stole $1.3 billion from Yasser Arafat’s old rainy day fund of looted tax money according to a political opponent, Muhammad Dahlan.  The once $2 billion Palestinian Investment Fund (PIF) slush fund has long been under a well-deserved cloud of suspicion for corruption, cronyism, and nepotism.  (See here and here.)  This only reinforces our understanding of the horrible corruption and fathomless accounting of the Palestinian Authority.

(And yes, Hillary Clinton still wants unfettered access to U.S. tax dollars to continue transfers to the entities like the Palestinian Authority.)

From the Jerusalem Post:

Abbas ‘feels he’s above the law,’ charges Dahlan
By KHALED ABU TOAMEH
07/31/2011

Ousted Fatah official Muhammad Dahlan over the weekend launched a scathing attack on Palestinian Authority President Mahmoud Abbas, accusing him of dictatorship and financial corruption.

He said that more than $1 billion have gone missing from a fund that was handed over to Abbas after he was elected president in 2005.

Dahlan’s attack on Abbas came after PA security forces raided the former Fatah commander’s home in Ramallah on Thursday, arresting his bodyguards and confiscating weapons and armored vehicles.

Dahlan was at home during the raid, which was carried out by dozens of security officers, but was not detained thanks to his parliamentary immunity.

Shortly thereafter, Dahlan left for Jordan through the Allenby Bridge, where he gave a series of interviews to Arab media outlets in which he strongly condemned Abbas, 76, and accused him of financial corruption and seeking to destroy Fatah.

“Abbas does not recognize any law, morals or values,” Dahlan said, referring to the raid on his home and last month’s decision to expel him from the Fatah Central Committee.

“Abbas feels that he’s above the law.”

Dahlan said that the dispute between Fatah and Hamas, and Israel’s presence in the West Bank, gave Abbas a “free hand to practice dictatorship against the Palestinian people, silence people and deny them their salaries.”

Dahlan said that the dispute with the PA president erupted after he demanded to know what had happened to $1.3b. that was in the account of the Palestinian Investment Fund.

The PIF was established in 2000 as an independent Palestinian investment company “committed to maximizing the assets’ value for its shareholder: the Palestinian people.”

According to its website, PIF’s chief objective is “to safeguard and consolidate the Palestinian people’s investments and property, both in Palestine and abroad.”

Dahlan said that after the death of Yasser Arafat, the responsibility for the fund was transferred to Abbas in 2005.

“This is money that Yasser Arafat had collected from Palestinian taxpayers for the day that we would need it,” Dahlan explained. “There aren’t more black days than today, where our employees are not receiving salaries. Why doesn’t he pay from this fund, which he controls personally? The PLO does not know about this sum.

This is documented money that was delivered to him [Abbas] from an international accounting company.”

Dahlan said that when he exposed the issue of the PIF last April, Abbas got furious. “He thinks that the sun can be covered with a sieve,” he added.

“Yasser Arafat worked strenuously to save this money for the ‘black day.’ Mahmoud Abbas thinks that the people don’t know where this money is and who received it. Now he’s admitting that there is only $700 million in the fund.

But the real sum should be about $2b.”

Read the rest of this entry ?