Dispute Between Iran's Oil Ministry and Babak Zanjani's Lawyer Over His Debt Settlement

The issue of settling part of Babak Zanjani's debt, an Iranian businessman imprisoned for economic disruption and fraud, became a topic of contention on Tuesday, November 2, between officials and the lawyer of the National Iranian Oil Company (NIOC) and Rasoul Kouhpayehzadeh, Zanjani's lawyer. While the NIOC lawyer denied the settlement of part of Zanjani's debt on Tuesday, news agencies quoted Zanjani's lawyer as saying that 1.427 billion euros of his debt had been settled, but the guarantee for the payment of the proceeds from oil shipments, which constitutes another part of his debt, had not yet been issued. Fars News Agency published an interview with Rasoul Kouhpayehzadeh on Tuesday, in which he provided explanations regarding his client's debts, stating that the debt related to the amount given to him through the Central Bank had been settled. Following this, Ali Akbar Mahrokhzadeh, the legal director of NIOC, told Iranian news agencies, including Tasnim, that the news of the settlement of Zanjani's 1.427 billion euro debt was a "fallacy" and that his lawyer had not explicitly stated this, but some media had mistakenly quoted him, and that neither the court nor the Central Bank, which are official bodies, had confirmed this settlement, and so far no cash or guarantee had been received from Babak Zanjani. Mahrokhzadeh also stated that he was not aware of other financial matters related to Zanjani with the Central Bank and only knew that Zanjani had a debt of 2.06 billion euros for which the Oil Ministry had filed a lawsuit against him. Gholamreza Mahdavi, a lawyer for NIOC, also told Tasnim that "we are not aware of the claim made by Zanjani's lawyer regarding the settlement of the defendant's cash debt to the oil company, and the court or the Central Bank must confirm this claim." On the other hand, Zanjani's lawyer provided explanations to Iranian news agencies, including ISNA, regarding his client's debts and the settlement of part of it. He stated that his client's debt to NIOC has two parts. One part is the cash that the oil company had given to his client through the Central Bank, amounting to 1.427 billion and 500 thousand euros. The other part is the money for oil shipments. Kouhpayehzadeh added that out of the 1.427 billion and 500 thousand euros of his client's cash debt to the oil company, 660 million euros had previously been paid by his client to the oil company's contractors under the direction of the Oil Minister, leaving 767 million and 500 thousand euros remaining. He continued that on Tuesday, the deputy prosecutor of Tehran and the person responsible for transferring his client's assets to the Oil Ministry officially announced in a letter to the court that his client's domestic assets are currently valued at about 2,600 billion tomans. Kouhpayehzadeh then stated that if this amount is converted and deducted from the remaining claim of 767 million and 500 thousand euros, his client's cash debt to the oil company would be settled. Zanjani's lawyer added that this matter is separate from the guarantee that his client has promised to issue for the payment of the debt to the "HK" company from a reputable foreign bank for an amount of 1.967 billion euros, which will be received on Tuesday or Wednesday. Zanjani's lawyer mentioned that this matter is being pursued but "due to confidentiality, he cannot disclose details." The "HK" company is affiliated with NIOC and is said by Iranian media to expedite the transfer of funds related to oil exports on behalf of the Iranian government. However, this company is on the sanctions list related to Iran's nuclear program. Kouhpayehzadeh told Tasnim: "Given that the sanctions are still in place and the matter is confidential and extremely sensitive, and some are trying to disrupt this transfer process, and because the confidential correspondence that previously existed between us and the oil company was published and made public due to the negligence of one of the oil company's lawyers, we will raise the matters related to the issuance of the guarantee in court and it is not advisable to publicize it." He also commented on the statements of NIOC officials who said that no money had been deposited by Babak Zanjani into the oil company's account so far, saying: "From the very beginning, my client never said that he would deposit the money. Because both my client, the HK company, and my client's banks are under sanctions, and there is no power to transfer a dollar until the sanctions are lifted." The Iranian judiciary has accused Babak Zanjani, who helped the Iranian government circumvent sanctions during Mahmoud Ahmadinejad's presidency, of "corruption on earth," "disruption of the country's economic system," "fraud," "money laundering," "forgery of invoices and documents," and "spreading falsehoods."