Courtesy of: Associated Press
Controversial ties between two countries hostile to the United States reemerged on Saturday when a former Iranian official was caught in Germany with a sizable check from a Venezuelan bank. The German newspaper Bild am Sonntag first reported that German officials are investigating Tahmasb Mazaheri, Iran’s former central bank chief and economy minister, for smuggling after he was caught with an undeclared check worth approximately $70 million.
Upon his arrival from Turkey on January 21, Mazaheri was stopped and searched by German customs officials at the Dusseldorf airport. A check for 300 million Venezuelan Bolivars issued by the state-run Bank of Venezuela was found in his luggage.
According to customs authorities, visitors entering any of the European Union countries must declare incoming amounts above $13,580. Failure to disclose the funds is a civil offense punishable by a fine of up to $1 million. German authorities have not yet disclosed to whom the check was directed and are expected to decide later this month whether to press charges. In the meantime, local and international concern has emerged, sparking questions about how a former Iranian official ended up with a check of such a significant amount – in Venezuelan currency.
Iran’s ambassador to Venezuela, Hojattolah Soltani, told the Venezuelan media that the check was going to pay the expenses of the Kayson Company, an Iranian construction business that builds public housing for the Venezuelan government. According to the ambassador, Kayson has a contract to build approximately 10,000 low-income housing units. However, it remains unclear why Mazaheri misled German officials; declaring he was traveling with less than $13,580. When questioned by customs authorities, he failed to provide adequate explanation of the purpose and recipient of the funds, leading to further skepticism. Soltani claimed Mazaheri did not declare it because the check was not for him and was not destined for a German bank.
Reports confirm that Mazaheri has returned to Tehran, as officials launch an inquiry into possible impropriety and determine whether to return the check. But the controversy has given rise to the possibility that Venezuelan banks are helping Iran evade the economic sanctions imposed against it as a result of its nuclear development program. According to sources, the discovery has prompted a further investigation by the international community into the ties between the Venezuelan financial system and Tehran.
Such actions mirror the ongoing U.S. investigations into some of the largest European banks for violating sanctions against Iran. The investigations resulted in billions in fines between 2010 and 2012.
Members of the Venezuelan opposition alleged that the Kayson Company is on Canada and the United Kingdom’s list of undesirable companies, largely due to its links with illegal businesses.
United by their public condemnation of the U.S., Iran and Venezuela have built a strong alliance since Iranian President Mahmoud Ahmadinejad assumed office in 2005. They have reportedly signed over 70 joint venture agreements in housing, agriculture and energy, among other areas. The deals are valued at up to $17 billion, though neither country has much to show in terms of progress.
Mazaheri was personally involved in one of those projects back in 2008, when he became president of the International Development Bank (IDB), opened in Caracas as an independent subsidiary of the Export Development Bank of Iran (EDBI). Nine months after its opening, the U.S. Treasury Department imposed economic sanctions on both entities for financing Iran’s nuclear programs.
Citing the irresponsible handling of funds money by the Venezuelan government, the country’s opposition is demanding an explanation. Venezuelan officials have yet to comment on the matter. And with Hugo Chávez’s condition unknown to any except his Cuban medical team – now two months after his cancer surgery – the world remains wanting for answers.