Iran’s hardline religious militia is about to receive a rush of funds from Britain and the West after taking control of hundreds of companies that do not appear on sanctions lists.
The Iranian Revolutionary Guard Corps (IRGC), a branch of Iran’s military accused of funnelling arms and other support to Hezbollah and President Assad of Syria, has placed top commanders at the heart of more than 200 Iranian companies, according to an analysis seen by The Times.
Western sanctions against Iran are expected to be lifted in March. In exchange for nuclear co-operation, the country will regain access to the international banking system and up to $150 billion in frozen assets.
Leaders have argued that the IRGC will not gain significantly because sanctions against it and its commanders will remain. However, at least 229 Iranian companies that have never been on an EU or US blacklist have IRGC board members or shareholders, according to Foundation for Defence of Democracies (FDD), a US think tank, and they will find it easier to trade with the West.
“It’s inevitable that Revolutionary Guard individuals or organisations will benefit from the opening up of business with the international community, and that UK companies may provide some of that financial benefit,” Tom Keatinge, director of the Centre for Financial Crime and Security Studies, said.
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Iranian sources have separately claimed that the IRGC has been placing staff in Iranian companies that worked as the partners of foreign companies before sanctions were imposed.
Western companies may be unaware that their Iranian partner has a connection to the IRGC. Last week a handful of British companies travelled to Iran on a trade mission. BP decided not to go amid concerns that the US might take legal action against foreign companies trading in Iran even after sanctions were lifted. Other European countries have already forged deals with IRGC-controlled entities. A French company is providing parts to the Telecommunications Company of Iran (TCI), which was bought by an IRGC-controlled consortium in 2009.
An FDD analysis of the IRGC’s commercial interests reveals that 14 companies on the country’s stock exchange, with a combined value of more than $17 billion (£10.8 billion), have shareholders connected to or controlled by the group. Twelve have never been subject to sanctions. These include TCI and the Bahman Group, a vehicle maker. A further 217 non-public companies have former or present IRGC commanders in senior positions, the FDD said. These include Masoud Mehrdadi, a former brigadier-general, who is a director of at least seven IRGC-controlled companies, and Asghar Sabouri, said to be the deputy commander of IRGC’s ground force, who is on the board of at least four companies.
Technically, any company “owned or controlled” by an entity subject to sanctions is also caught by the sanction. Lawyers said IRGC ownership would be hard to detect, but British companies would be responsible for checking.
Companies to be wary of
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Telecommunications Company of Iran
In 2009 a consortium connected to the Iranian Revolutionary Guard spent $7.8 billion on a majority stake in TCI, Iran’s largest telecommunications company. A cable leaked by WikiLeaks noted that the huge sale was consistent with other “privatisations” under President Ahmadinejad, which transferred ownership of state assets to cosy associates such as the IRGC.
TCI’s parent company oversaw 33 subsidiaries and had a monopoly on fixed-line business in Iran. Not sanctioned, but western investors may be caught if they engage with it.
The Bahman Group
A manufacturing conglomerate licensed to assemble Mazda vehicles. According to the Defence of Democracy Foundation, four out of five of Bahman’s board members are IRGC entities and The Wall Street Journal reported that the IRGC holds a 45 per cent stake.
Ghadir Investment Company
Unlike Bahman and TCI, Ghadir is not directly owned by any IRGC entity, but it is majority owned by a handful of armed-forces funds which, according to the Foundation for Defence of Democracy, connects it to the IRGC, which is part of the military structure.