Consultant Convicted of Violating Embargo

     (CN) – A federal jury convicted management consultant Mahmoud Reza Banki of violating Iran’s trade embargo after he helped Iranians transfer money through an informal value-transfer system known as a “hawala.”




     Under a hawala system, “money does not physically cross international boundaries through the banking system,” federal authorities said in a press release.
     Banki used the network to receive $4.7 million in wire transfers spanning from Sweden to the Philippines, which were held in his Manhattan Bank of America account, according to the indictment.
     Banki’s father, who lived in Iran, would pay a hawala operator in Tehran millions in Iranian currency and the operator would arrange the corresponding amount of U.S. dollars to be transferred to Banki’s American account.
     The hawala operators profited from the currency exchange, and Banki used the U.S. currency for personal and business expenses.
     The jury found Banki guilty of conspiracy to violate Iran’s embargo and to operate an unlicensed money transmitting business. He faces more than 20 years in prison and is scheduled for sentencing on July 16.

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