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Khamenei Orders Rouhani To Explain Lack of Transparency In Gold And Forex

An Iranian goldsmith counts his gold coins at a gold market in the main old Bazaar in Tehran. File photo

Iran’s Supreme Leader Ayatollah Ali Khamenei has “ordered” President Hassan Rouhani to present “an accurate report” to shed light on ambiguities about the way the government has allocated foreign currency and sold gold coins to companies and individuals during recent months, Iranian media reported on Friday, July 6.

Khamenei has expressed concern over the lack of transparency on the part of the government in allocating resources, reported Mehr news agency.

Following the recent instability in the Iranian markets, the Rouhani administration allocated foreign currency to a number of companies at a subsidized lower rate of 42,000 rials per US dollar as opposed to the market rate of 90,000 rials. However, the media and some government officials have reported “irregularities” in the allocation of foreign currency.

Presidential adviser Akbar Torkan charged that some of the profiteer companies pocketed extremely unusual profits by selling their imports at the higher market rate.

Meanwhile, Iran’s Ministry of Telecommunications also released a list of companies that had benefitted from lack of transparency in allocations of foreign currency. The ministry said some companies received $220 million from the government but imported only $75 million worth of cell phone handsets.

Although registered as private companies, most of these firms reportedly have links to government organizations and the armed forces.

Further documents released by other government offices showed that some companies run by regime insiders have imported goods that had nothing to do with their usual business. For instance, Petro Yas Pars, a company registered to trade in petroleum products, imported poultry feed.

The irregularity was later proved to be widespread. For instance, Rahrovan Khodro, an automotive parts company, imported tea leaf, and Shayan Khodro Adak, another vehicle parts company, imported paper.

In another development, the Iranian Central Bank started selling gold coins to members of the public in February to be delivered to buyers later. However, chairman of the Iranian State Audit Organization revealed in June that 50 buyers had bought 380,000 coins, that is 5% of all the coins that were minted by the bank. The official added that the very well-connected, privileged buyers made a profit of 10,000,000 rials for every single coin. With the exchange rate at the time, that would make a total profit of between $60-70 million.

Tehran Police Chief Hossein Rahimi said on 27 June that the police have arrested someone nicknamed King of Gold, who bought some two tons of gold coins within ten months, thanks to his connections.

The King of Gold was arrested although there is no legal limit to the number of coins a person can purchase. However, it is not clear how this man could jump the queue to single-handedly buy what could have been bought by thousands of other Iranians on a “first come, first served” basis.