Iran used Lloyds and Santander to evade sanctions

Iran used two of Britain’s largest banks to move money covertly around the globe as part of an extensive sanctions-evasion plan backed by Tehran’s intelligence services.

Documents show that Lloyds and Santander UK opened accounts for British front companies owned secretly by a Iranian company located near Buckingham Palace.

The US has accused the state-controlled Petrochemical Commercial Company of being part of a large network which raised hundreds of millions of US dollars for the Iranian Revolutionary Guards Quds Force, and worked with Russian intelligence agencies in order to raise money for Iranian proxy forces.

Since November 2018, PCC UK and its British subsidiary PCC UK are both under US sanctions.

Documents, emails, and accounting records reveal that PCC’s UK Division continued to operate from an office located in Grosvenor Gardens Belgravia using a complex network of front companies in Britain and abroad.

Revelations about the Iranian sanctions-evasion operation in the heart of London come after the Royal Air Force recently joined US air strikes against Iranian-backed Houthi rebels in Yemen. This week the UK and US placed under sanctions what they called a “Transnational Assassinations Network” The Iranian intelligence services has been targeting activists and dissidents including British residents.
Documents analysed reveal that, since the US imposed sanctions on PCC, it has used UK companies to receive money from Iranian front entities located in China.

One of these firms, Pisco UK is registered at a detached home in Surrey, and it used a Santander UK business account.

According to the UK Corporate Registry, Pisco UK’s full owner is a British citizen named Abdollah Siauash Fahimi. Internal documents, which were leaked by WikiIran (an Iranian opposition website), show that PCC controls Pisco and that Fahimi has signed an agreement on behalf of PCC to hold the company as a trust.

Fahimi used an email address from PCC to correspond with officials at the company in Tehran. According to UK corporate filings, he was the director of PCC UK between April 2021 and February 2022.

Pisco received a transfer to its Santander account in 2021 from a Chinese firm called Black Tulip. According to PCC internal records, this company is controlled by an employee of the PCC. Last year, the US Treasury accused Iranian petrochemicals firms of using multiple front companies to avoid sanctions by routing their sales through Asia.

Santander stated that it could not comment on client relationships, but that they were “highly focused” on compliance with sanctions. According to a person with knowledge of the situation, the bank has shut down Pisco’s accounts.

Aria Associates is another front company for PCC in the UK, and it has a Lloyds account. Mohamed Ali Rejal is its official owner. According to internal emails, he is the deputy CEO of PCC UK. He has communicated regularly with officials from PCC in Tehran.

In July 2021, an accounting official at PCC in Tehran sent Rejal an email about a payment that was to be made by China. He asked him to “please send us the safe-deposit account number.” For payment.”

Rejal wrote to the accounting official that the money should be transferred into Aria Associates Lloyds’ account. “Please ensure there is no indication of PCC (UK) or PCC.”

PCC UK Rejal Fahimi have not responded to any requests for comment.

Lloyds Banking Group stated that it was unable to comment on specific customers, but adhered to sanctions laws. “We also cannot comment due to legal restrictions on reports of suspicious activities to the relevant authorities if and when they occur.”
Alicia Kearns is the Tory chairperson of the Commons Foreign Affairs Committee. She said: “For many years, I have raised my concerns regarding the need to shut-down cut-outs operating in the UK. This investigation shows that there is still more to be done.

Liam Byrne of Labour, chair of the Commons Business and Trade Committee, said that it was “astonishing” how we failed to act with our allies in order to stop the funding of a hostile government. It is hard to believe that a US-sanctioned business can trade freely in London.

David Asher, a senior Fellow at the Hudson Institute, and a former US State Department official who worked on sanctions and counterterrorism operations relating Iran, said that the scheme demonstrated how IRGC connected entities “continued to use London as a Financial Centre”.

He said that continuing to do business with the Iranian regime is not only a risk, but also incompatible with UK policy.

Standard Chartered and UniCredit have both paid large fines for violating US sanctions against Iran.

As seen in other documents, PCC also continued to operate within the UK and entered into equipment procurement contracts with a Turkish firm called ASB. ASB was sanctioned by the US last year for its association with senior IRGC officials.

The audit reports of PCC UK for 2021 show that the company maintained large trading accounts with PCC Iran after being under US sanctions. This allowed it to continue operations despite western banks refusing to do business with PCC.

The PCC UK office in Belgravia is also the registered address of NIOC International Affairs Ltd, a subsidiary of Iran’s sanctioned national oil firm, Washington claims that the IRGC, and Iranian military activities, are directly funded by the NIOC.