Three suspects implicated in a criminal case against Sarmayeh Bank, including a former government minister, have been put behind bars with bail set at ten trillion rials (roughly $240,000).
Minister of Cooperatives, Labor, and Social Welfare under former president Mahmoud Ahmadinejad, Parviz Kazemi, who was head of Sarmayeh Bank’s board of directors after leaving government, is among the three defendants facing charges of financial corruption at the bank. Ali Bakhshayesh and Mohammad Reza Tavassoli, the bank's former managing director and legal advisor respectively, face charges along with Kazemi.
At a January 29 court hearing, Kazemi admitted that 30 million euros (roughly $35 million) deposited in his wife’s bank account was indirectly paid by a South Korean firm to Kazemi as a “consultation fee.”
Kazemi, 61, resigned from his post as minister in 2006 and began working in banking.
In addition to the three facing charges, the prosecutor claimed 32 other managers at the bank committed “obvious” regulatory violations.
Iran’s banking sector, largely owned by the government or various state institutions have been a heaven for fraud, costing taxpayers billions of dollars, especially in the last decade.
During previous hearings, the judge disclosed that an individual named Rahmatollah Assadi had deposited the 30 million euros in Kazemi’s wife’s bank account on behalf of an undisclosed South Korean firm.
It was also revealed during trial that Kazemi gained a seat on the board of directors of a company called Steel Azin by granting a six trillion rial (roughly $143 million) loan to an investor named Hossein Hedayati. The investor only returned $2.9 million of the loan, having squandered the rest.
The main shareholder of Sarmayeh Bank is Iran's Teachers Reserve Fund.
The fund has 800,000 members, all employed by the Education Ministry, who receive annual interest based on their monthly deposits.
The prosecutor says 150 trillion rials (roughly $3.6 billion) of the fund's assets went missing as a result of fraud committed by the three defendants.
Had Razavi, the son-in-law of the current Minister of Cooperatives, Labor, and Social Welfare, Mohammad Shariatmadari, is also implicated in the case, as is Mohammad Emami, producer of the popular TV program Shahrzad.
Razavi, is accused of lying about the value of his assets in order to get approval for massive loans. Emami is accused of taking more than $230 million loans from the bank fraudulently.
Iran’s Vice President, Es’haq Jahangiri, recently admitted on state-run media that financial corruption in Iran reaches to the country’s top officials. “ The fight against corruption needs impartiality, free from factional interests”, Jahangiri told IRNA August 18.
Jahangiri mentioned Ahmadinejad’s Vice President Mohammad Reza Rahimi as well as his Deputy for Executive Affairs Hamid Baqaei, both of whom are serving prison terms for corruption, as examples of graft reaching the highest levels of government.
However, some of the closest allies of current President Hassan Rouhani and his vice president have also been questioned about possible corruption, including Rouhani’s brother, Hossein Fereydoun, and Jahangiri’s brother Mehdi.