The 41-year-old self-made billionaire Babak Zanjani (pictured above) could not have imagined in his worst nightmare that he would fall so low: At the beginning of March, a court in Tehran sentenced Zanjani and two accomplices to death for embezzlement. He is allegedly withholding 2.7 billion dollars for oil he had sold on behalf of Iran's oil ministry. Zanjani had apparently helped the former government under President Mahmoud Ahmadinejad to evade oil sanctions by selling several millions of barrels of Iranian oil on the black market through a network of over 60 countries based in the United Arab Emirates, Turkey and Malaysia.
Babak Zanjani's attorney Rasoul Koohpayehzadeh blames the media and the reformist camp for mobilizing a politically motivated campaign against his client. He has insisted that Zanjani is only a "debtor" who would most certainly return the 2.7 billion dollars to Iran. The lawyer argued that the international sanctions have kept his client from doing so. Just before the verdict was passed down, Justice Minister Mostafa Pourmohammadi hinted that Zanjani could avoid execution if he were to hand over the embezzled funds.
Money laundering at the great bazaar
In December 2013, Zandjani was arrested. In the summer of 2013 he admitted in an interview that he had come into contact with the black market at the beginning of his career. During his civilian service, long before the imposition of sanctions, he was employed as a driver for Iraq's Central Bank, and there, he was noticed by the former head of the Central Bank, Mohsen Nurbakhsh. Apparently Nurbakhsh himself hired Zanjani to exchange dollars on the black market at Tehran's bazaar. This is how the Central Bank exchanged revenue from oil exports into Iranian rials, thus financing the Iranian state apparatus.
The manager of the now deceased Nurbakhsh claims he does not know about this story nor does he know the two people involved. Actually, things quieted down after Zanjani was arrested. At the peak of his success, he was surrounded by important people and powerful politicians. According to the little information that transpired from his 40,000 page file, Zanjani apparently had direct ties to at least five ministers in the former Ahmadinejad government. This file seems to be making many politicians and Ahmadinejad supporters nervous. During his trial, Zanjani repeatedly asked to testify before the parliamentary committee formed especially for his case – in vain.
After 21 months of investigative custody, Zanjani's trial commenced. The hearing took over two months. At the end, the Islamic court found that Zanjani and his accomplices had "spread corruption on earth." The court sentenced all three of them to death and also ordered them to repay the withheld billions.
No investigations on backers
"The Zanjani case will keep us busy for a while; the death sentence is not final," said Seifollah Yazdi in his assessment of the case. The publisher of an Iranian business magazine based in Tehran said that Zanjani will probably appeal the decision. The problem is that investigations into Zanjani's activities did not show who backed him, and generally, more questions have arisen than have been answered. For example, the main question remains: Who allowed the young businessman to trade in oil? And who else benefited from the empire built around the sanctions? After all, Zanjani has apparently amassed assets worth 10 billion dollars. If the accused dies, then the case would be closed for good.
That is why Iran's President Hassan Rouhani does not think that the death sentence for Zanjani is helpful. He said, "We have seen how a person was able to pocket billions of dollars despite sanctions. Now he has been sentenced to death. Yet his execution will not solve any problems." Hassan Rouhani wants a full explanation. The Zanjani file may be a storehouse of information on corruption by officials and politicians in the Ahmadinejad era. After he took power in the summer of 2013, Rouhani decided to focus on the battle against corruption and launched intensive investigations into various corrupt organizations, which also led to the arrest of Babak Zanjani.
The justice system is being difficult
However, the president has no influence on the judiciary, which acts independently of the government and reports directly to the religious leaders. It is still firmly in the hands of the hardliners who supported Ahmadinejad for eight years. According to the Corruption Perceptions Index (CPI) from Transparency International, Iran fell from 78 to 144 in its ranking during those years.
Corruption in Iran is systemic, said the Iranian economist Fereydon Khavand in an interview with DW. The lecturer and researcher at the University of Paris Descartes does not believe that Rouhani's government alone can fight corruption. "Iran's position has slightly improved on the corruption index and moved up to 130 in 2015. But the Rouhani government alone cannot fight the systemic corruption. It needs concerted action and strong cooperation between the authorities. But the justice system in Iran has no interest in such cooperation."