Petrochemical Case: Petrochemical Trading Company Still Owes 500 Million Euros

On Wednesday, March 13, the National Petrochemical Industries Company of Iran announced in an official statement that the Petrochemical Trading Company has not returned 500 million euros of claims from producers related to exports from the year 2013. Several managers of the Petrochemical Trading Company are among the accused in the ongoing petrochemical corruption trial. Despite Tehran's prosecutor stating that embezzlement did not occur in the petrochemical corruption case and only 'misuse' took place, the National Petrochemical Industries Company claims that the Petrochemical Trading Company owes 500 million euros and that the accused have also profited approximately four billion euros in their accounts. According to the statement, the accused also sold nearly four billion euros worth of petrochemical products in the years 2011 and 2012, but only returned the equivalent in rials based on the official currency rate, which was lower than the 'reference' currency rate. The National Petrochemical Industries Company stated that the accused have not returned 500 million euros of claims from producer companies resulting from exports in 2013, and this amount, including its principal and interest, is part of the claims and complaints from these companies that are currently under legal review. Previously, Abbas Jafari Dolatabadi, the Tehran prosecutor, announced on Tuesday, March 12, that there was 'no embezzlement' in the petrochemical trading case and that the accused 'misused' the funds. The National Petrochemical Industries Company stated that the accused, in addition to not returning this '500 million euros', received part of the petrochemical export money in euros and returned it in rials at a lower rate. According to this statement, the accused did not return 3.2 billion euros of export currency from state-owned petrochemical companies in 2011 and 622 million euros in 2012, instead paying the equivalent in rials based on the reference currency rate (1126 tomans). Meanwhile, the company stated that during those years, 'the exchange rate only differed between 200 to 1200 tomans from the reference currency'. The accused allegedly circulated or held the proceeds from exports in accounts belonging to various individuals abroad under the pretext of sanctions, and 'the mere circulation of these amounts... has brought various benefits and significant credibility to the account holders'. The National Petrochemical Industries Company announced that 'the main subject of the current court is the investigation of the managers' violations regarding the betrayal of trust in this matter', a topic that the Tehran prosecutor also mentioned in his remarks on Tuesday without going into details. In the case known as the 'petrochemical corruption', which has held two court sessions so far, accusations have been raised against 14 individuals, including several managers of the Petrochemical Trading Company. In the hearings of this case, three of the accused, who are abroad, are not present, but according to the Tehran prosecutor, their lawyers are attending the court sessions. It is unclear whether the lawyers of the three absent defendants were appointed by them or are court-appointed. Meanwhile, the Tehran prosecutor stated that part of this case remains 'open', which is a 'heavy' section related to 'fugitive' defendants, including Marjan Sheikh Al-Islami. In the indictment related to Reza Hamzelou, the first accused in this case, Ms. Sheikh Al-Islami is introduced as his 'main partner', who has collaborated with him in establishing several companies in Turkey. The judge also stated at the end of the second session of this court, which focused on the charges against Mr. Hamzelou, that in the third session, the first accused will explain his relationship with Ms. Sheikh Al-Islami. A date for the next court session has not yet been set. On Wednesday, Mohammad Jafar Montazeri, the Attorney General, announced that a 'judicial order has been issued and communicated to Interpol' regarding the 'return of Ms. Sheikh Al-Islami', who is currently in Canada, but added that 'the problem we have with Interpol is with countries that have animosity towards us'. In these remarks, reflected in the official news agency of the judiciary, Mizan, there was no mention of the status of two other defendants who are abroad. The first two sessions of this court focused on presenting the general charges and the indictment against Mr. Hamzelou, and although he made some defenses about himself in the second session, the indictment and other defendants' charges have not yet been addressed. The defendants in the petrochemical corruption case collaborated with the National Petrochemical Industries Company, which was a state-owned company until 2009 and was privatized that year. The National Petrochemical Industries Company described the privatization of this company as 'a strange action' that contained 'a significant rent-seeking'. At the end of this statement, it was noted that this corruption 'is by no means comparable to the ugliness and magnitude of the corruption of the criminal Babak Zanjani, who still holds the first place in fraud and corruption by a significant margin'. Hassan Rouhani, the president, and some other officials of the Islamic Republic have announced Babak Zanjani's debt as two billion and 600 million euros.