Regulatory intelligence for US exporters

Iranian National Illegally Exported US Electrical Products, DOJ Says

Iranian national Mehdi Khoshghadam violated U.S. export controls by illegally shipping electrical cables and connectors from the U.S. through Hong Kong and to Iran, DOJ said March 9. Khoshghadam was charged with one count of conspiracy, one count of violating of the International Emergency Economic Powers Act and one count of conspiracy to commit money laundering. The indictment also seeks to forfeit all “proceeds” earned by ​​Khoshghadam from the illegal exports.

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Khoshghadam, the managing director of Pardazan Systems Namad Arman, an Iranian electronics importer, allegedly began buying the electrical connectors and cables from a U.S. company in 2016. DOJ said he shipped the goods to a freight forwarding company in Hong Kong before eventually sending them to Iran. Khoshghadam used the alias “David Lei” to buy from the U.S. company, the agency said, and used Merlin International Trading Company, a front company “purported” to be based in Singapore, to buy the goods.

When Khoshghadam first tried to buy the goods under a different name, the U.S. company told him its bank rejected the payment because the payor’s name needed to be identical to the company submitting the order, DOJ said. Khoshghadam then had a “co-conspirator” in China pretend to be Khoshghadam’s agent and handle the payment, DOJ said.

Between January 2016 and May 2018, Khoshghadam used front companies in China and Malaysia to submit three orders to the U.S. company, which helped to “conceal the true identity of the purchaser”and hide that the items were destined for Iran, DOJ said. After the U.S. company shipped the goods to Hong Kong, Khoshghadam had the goods “repacked with falsified shipping records,” which listed a non-U.S. company as the shipper and the ultimate destination as Iran.

Khoshghadam also “falsified” from BIS-711, a document required by the Bureau of Industry and Security in which the purchaser of U.S. goods lists the “identity and location of the true end user of the purchased goods,” DOJ said in a news release discussing the indictment handed down by a grand jury. Khoshghadam listed a China-based company as the end user instead of the true end user in Iran.

The items also required licenses from the Treasury Department’s Office of Foreign Assets Control, DOJ said. The agency also said Khoshghadam made three money transfers from bank accounts in China, Malaysia and elsewhere to U.S. bank accounts or used U.S. correspondent banks “with the intent to promote the unlawful exports to Iran.”

Khoshghadam faces a maximum five-year prison sentence for the conspiracy charge and 20-year prison sentences each for the IEEPA charge and money laundering conspiracy charge. Khoshghadam may also face “financial penalties.”