Iranian Banker Involved In Massive Embezzlement Case Has $3-Million Toronto Home

One of the officials at the centre of the biggest fraud scandal in Iranian history is reportedly residing “in the Toronto area – where a $3-million home is owned in his name,” reported Canadian daily the Globe and Mail.

According to Iranian media reports, Mahmoud Reza Khavari, the former chairman of the board and managing director of Iran’s largest bank (Bank Melli) flew from London to Frankfurt a day after submitting his resignation on 27 September. He then boarded a Lufthansa flight to Toronto.

His resignation follows an embezzlement scandal involving more than $2.6 billion. Khavari is among 22 people being sought by Iran’s judiciary in the case, and his bank has been accused of facilitating some of the fraudulent payments.

Some media outlets had reported that Khavari would eventually return to Iran on Thursday, something that never happened.

In his resignation letter to Iran’s Minister of Economic Affairs and Finance Shamsoddin Hosseini, Khavari had pointed the finger of blame at an investment company owned by Amir Mansour Aria which according to him had “abused” the country’s banking system. He also blamed the partially state-owned Bank Saderat for responsibility in the case.

Khavari acknowledged the role of his own bank in the scandal stating that the bank’s General Department of Branches Affairs had shown disregard for his “written orders” and warnings issued by other bank officials.

A day after the publication of Khavari’s resignation, the head of Bank Saderat, Mohammad Jahromi who had been forced to resign, denied the allegations against himself and his bank, claiming that Khavari had “fled” to Canada “because of his links with the [embezzlement] case and the elements behind it.”

“Those who chose Mr Khavari in the first place as the managing director of Bank Melli—a person who along with his family had been [permanent] residents of Canada and did not feel any obligation towards the blessed Islamic Republic of Iran as he had acquired a Canadian residence permit—must now be held accountable for the financial fraud perpetrated by this brand of individuals.”

Jahromi, an executive advisor in the powerful Guardians Council who is also said to be close to Iran’s Supreme Leader Ali Khamanei, has vowed to reveal the “scale of and the names of individuals associate with” the fraud.

“It is in Mr Khavari’s interest to come back to Iran to defend himself against the accusations,” Iran’s Chief Prosecutor, Gholam Hossein Mohseni-Eje’i, told the semi-official Fars news agency last week. He maintained that should Khavari not return to Iran, “all” the allegations and blames will be directed at him.

Also, “a high ranking official in the Canadian government official” has told the BBC’s Persian service that Canadian officials were “aware” of the embezzlement charges against Mr Khavari and were examining the issue, but stopped short of making any further statements about the subject. The Canadian government has no extradition treaty with Iran.

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The Globe and Mail reported that property records showed “a Toronto home that’s registered in Mr Khavari’s name not far from newspaper magnate Conrad Black’s mansion in Toronto’s affluent Bridle Path neighbourhood. The Suncrest Drive property was bought for $2,925,000 on July 30, 2007.”

A woman at the property has been declining to answer questions regarding the whole affair.

Despite Ahmadinejad’s refusal to accept any government role in the fraud, opponents in the hard-line camp are linking the case to the illegitimate president who managed to win the office of president for a second term following another monumental fraud in the 2009 presidential election.

Meanwhile, members of Iran’s parliament are also directing their attacks against Hosseini, Minister of Economic Affairs and Finance, and have threatened to impeach him if he does not resign.

Conservative MP Mohammad Torghabeh said that Hosseini must either resign or be dismissed by Ahmadinejad himself. “If he does not resign after the parliament’s holiday period, the parliament will most certainly make use of its supervisory tools in a more serious way and will accelerate his impeachment,” said Torghabeh who is also a member of the parliament’s Presiding Board.

Previously, fellow Member of Parliament Moosalreza Servati had told Fars news that MPs had received documents linking the minister to the banking scandal.