List of Top Bankers, Government’s Game with Transparency / Abbas Dehghani
Masoud Nili, the economic advisor to President Rouhani, introduced six major challenges facing the country in 1396 (2017-2018) under the title of “hourly economic bombs of Iran”. These challenges included liquidity, unemployment, water and environmental issues, government budget, pension funds, and problems with the banking system. Some economists consider the banking crisis as the most important economic challenge facing the country at the moment, and even attribute the root cause of the chaotic liquidity to the flawed functioning of this evaluation system. Economists recommend surgery on the banking system for economic reforms and improvement of the monetary and financial system of the country. As the experience of countries like Turkey has shown, economic surgery began with the banking system and had brilliant results for the economy of that country. From the large debts of banks to the ownership and official assets of banks, only a small part of the chaotic performance of Iran’s banking system can be described.
The Central Bank of Iran’s Public Relations announced in September of this year: “Referring to section 1 of paragraph “d” of Note 16 of the 1401 Budget Law of the country, regarding the publication of outstanding facilities and major commitments of related parties in the Central Bank of the Islamic Republic of Iran’s website, and in accordance with the decision of the Money and Credit Council, which considers facilities and commitments of more than one trillion rials as major facilities and commitments of related parties, the list of banks whose information on major facilities and commitments of related parties has been finally reviewed at the end of the first quarter of this year, including information on non-current major facilities, is now available for viewing, categorized by each bank.”
Concealment for the benefit of large bank debtors.
The distribution of the list of major bank debtors has faced many challenges, one of which is the presence of large companies under the supervision of the leader of the Islamic Republic among the top debtors of the country’s banking system. The leader of the Islamic Republic of Iran, who is sometimes critical of the banking system, along with his affiliated institutions, are among the main supporters of those who benefit from banking resources. These supports have been so extensive and deep that following the publication of the name of the pharmaceutical company “Barakat” in the list of bank debtors in April of this year, the head of this company, which is a subsidiary of the “Executive Headquarters of Imam’s Order”, requested the removal of Barakat’s name from the list of debtors in a letter to the head of the Central Bank, citing their investment in the coronavirus vaccine and calling it a “misuse by enemies” and a “misinterpretation by society”. The debt of this company to the
According to most economic experts, the peak of systematic corruption in the Islamic Republic of Iran is in the banking system. This widespread corruption takes the form of granting large loans to individuals, accumulating losses in businesses, suspicious investments, and embezzlement. Despite the repeated emphasis by all government officials in the past two decades on fighting banking corruption, these efforts, including the prosecution and conviction of some individuals, have never stopped the train of corruption in the banking system of the Islamic Republic of Iran.
Hatembakhshi, bankrupt banks are taking money from people’s pockets.
Government and private banks own a larger portion of Iran’s economy every day and their shareholder circle expands. However, their financial statements show a significant accumulated loss, which must be covered by special facilities from indebted individuals. Banks have been receiving special support in Iran for years and have a share in all economic sectors. However, their disclosed financial statements reveal the heavy losses of the banking system. The financial losses of twelve private and government banks in Iran have been reported to be more than 320 trillion tomans.
Banking services in Iran are expensive and the interest rates for loans are higher than the ability of a large portion of the population to pay. However, many banks have paid special loans to their customers, exceeding the amount of deposits collected from them. The names of some of these special customers have been revealed during specific time periods and in competition between political factions within the government to gain power, but they are still considered untouchable by even the most influential individuals.
In the beginning of Mehr 1400, the financial statements of several state and private banks were published by the start of the thirteenth government’s cabinet. However, this “transparency” was not effective in revealing the names of major and primary debtors of the banking system who continue to engage in profitable activities on the sidelines. Some major bank debtors have received low-interest loans with repayment periods of forty years or more; low-interest loans with repayment periods of forty years or even more. The noteworthy event is the list of major bank debts.
Banks that have now recorded large losses in their financial statements have provided large facilities with astonishing conditions to large bank debtors, including repayment of loans over a period of two hundred to five hundred months and even more. According to the latest published financial statements by the country’s banks in 2021, twelve private and state banks have suffered heavy accumulated losses. According to statistics, the private bank “Ayande” is still the leader in loss-making. After this bank, the state-owned National Bank ranks second in terms of losses.
The cloud workers whose names remained hidden.
Ali Saadouni, an economist and expert in banking issues, says: “Through our experience, we have learned that in banking supervision, it is necessary for the general public to be involved; meaning that the market itself will take financial discipline. This is so important that it is included in the third column of the “Basel II and III” regulations, which are international banking laws that require disclosure of information and thus keep the general public informed. When the public is aware of this, it prevents many corruptions.” (3)
The spread of the names of debtors in previous governments was also mentioned and the names of some individuals were heard from here and there; to the extent that Abdolnasser Hemmati, former head of the Central Bank, presented a handwritten list of first-tier bank debtors to Ebrahim Raisi during his presidential election debates.
On the other hand, studies show that in the lists announced by the central bank, the amount of bank debts of most major debtors has not been declared in the list that Hemmati raised. This issue indicates the distorted and discriminatory nature of these lists; while a brief look at the records of major debtors can also indicate the same influence that was mentioned as the main reason for not disclosing the names of major bank debtors and the lack of serious determination to pursue this issue by the judicial system in negotiations. Some of these names, who even during the Ahmadinejad era were imprisoned due to bank debts, include:
Mehdi Falahatian, one of the partners of Babak Zanjani, who considers himself a “servant of the system in circumventing sanctions”. Some of his charges include “illegally acquiring wealth” in the amount of 380 million dirhams from Bank Mellat, and 220 million dirhams from Parsian Bank.
Dear Seyyed Mohammad Reza and his family,
The tea merchants with the commercial name “Golestan” were indebted to five banks, including Eghtesad Novin, Pasargad, Khavarmianeh, Saman, and Gardeshgari, for approximately 3,400 billion tomans until the end of 1397.
Nasrollah Izadpanah is the owner of the commercial brand “Estil Alborz”, which is one of the largest kitchenware production complexes in Iran. He owes only one hundred and ninety-one billion tomans to the Bank of Novin Economy.
Mohammad Rostami Safa, a former member of the Iran-Italy Chamber of Commerce, is the founder of “Savah Profile Company” and “Safa Industrial Group”. He is also among the contractors of the “National Gas Company” who has been involved in violations such as bribery and receiving illegal facilities.
Behrouz Rikhtegaran Esfahani, in addition to owing eight hundred and eighty billion tomans to Sarmayeh Bank, is also among the top debtors of “Bank Tejarat”. By the end of 1397, nearly seventeen thousand and seven hundred billion tomans of Bank Tejarat’s receivables were related to seventeen individuals and companies, among which his name stands out.
Rasoul Danialzadeh Namin, the king of Iran’s steel industry, is the owner of luxurious towers “Roma Residence” and “Floraie Kamraniyeh Tehran”. His children are members of the board of directors of satellite companies such as “Galvanized Roofing Pipe Industries of Qazvin”, factories of “Rolling” and “Pipe” in Semnan, “Mahan Galvanized Pipe” in Semnan, “Gilan Steel Complex” and “Kavian Steel”.
Abbas Iravani, an economic activist in the automotive industry, is the owner of “Azam Group” and is known as one of the major investors in Iran. Iravani is the manager of “Azam Holding”, which includes twelve component manufacturing factories.
Mohammad Sadr Hasheminejad is one of the founders of “Novin Bank” and the CEO of “Stratos Construction Company”, which has a three trillion tomans debt to the bank. He has borrowed 1.4 billion tomans from his own bank, Novin Bank, and has an unpaid debt of 106 million euros.
Mohammad Saeed Al-Aqeeli, a businessman who was sanctioned by the US Department of Treasury in relation to Iran, is the owner of Al-Aqeeli Economic Group, which owes the Revolutionary Guards two hundred million dollars for the sale of oil products. Al-Aqeeli had intended to purchase Parsian Bank with nearly ten trillion tomans in debt.
Mohammad Javad Eqdamiyan, the owner of famous commercial brands such as “Vista” and “Vina Bast”, is the seventh recipient of the most facilities from “Sarmayeh Bank”. He has received eight loans from eight companies until 1391 and in 1397, Eqdamiyan owed approximately 511 billion and 403 million tomans.
There is no accurate information available about a person named Shafiei. The judiciary has claimed that after the publication of the Hemmati list in the debates, the case of this person is under investigation.
Abdullah Abdollahi, a close associate of Ghalibaf, has two national ID cards and two different identities with close to 1.4 trillion tomans of debt to “Export Development Bank”. He is the owner of “Iranian Alborz Steel Company” and “Mazandaran Heavy Structures Company”, known as the main owners of the “Miankaleh Petrochemical Project”.
Gholam Hossein Motahari is one of the most prominent figures in Iran’s petrochemical industry, the owner of satellite companies in the petrochemical sector, and has close relationships with influential figures from both political factions in Iran. There is no information available about the exact amount of his bank debt.
Ali Ansari, is a close associate of the Islamic Revolutionary Guard Corps and Iranian security agencies. He is the owner of the dissolved “Tat” bank and the main shareholder of “Bank Ayandeh”, which has been linked to the “Iran Mall” case and large loans received from “Bank Ayandeh” and “Bank Sarmayeh” in the community. (4)
“These are all part of the black hole of banking corruption in Iran. Meanwhile, embezzlement and the non-disclosure of assets, companies, and properties owned by banks, collusion and rent-seeking in the buying and selling of these assets and ownership of these conglomerates are also hidden but real aspects of corruption in the banking system of the Islamic Republic of Iran.”
The political stance of the government with banking transparency.
The distribution of the list of bank debtors with the display of “transparency” by the government’s economic team began a few months ago. In the first phase, twenty-seven banks published a list of their non-performing debtors of over one hundred billion tomans. Ehsan Khandouzi, the Minister of Economy, also promised that in the next step, the names of other non-performing debtors will be revealed. Not only was this list never disclosed, but now the decision of the Money and Credit Council has made it legal not to disclose it. On the other hand, the published list only included a number of real individuals and companies; there was no information about the loan amount, remaining balance, or interest on the loan. It was not clear when the loan was received and for what purpose.
The distribution of an incomplete and incomplete list of bank debtors at the beginning of this year had also faced criticism. The newspaper “Javan”, close to the Revolutionary Guards, at the same time claimed, based on “informed sources and some bank managers”, that the names announced were “currently small debtors” and the reason for its publication was to “pressure” or “intimidate” large debtors to “settle their debts”.
In other words, the incomplete and ambiguous release of the “bank debtors” list, despite being heavily advertised by the government and its supporting media, it is clear that not all individuals whose names appear on these lists are “major debtors” and some of the “debt-ridden sultans” are missing from this list.
This is while the representatives of the Islamic Consultative Assembly had also obligated the Central Bank in Section D, Clause 16 of the 1401 budget law to publish and make available to the public the facilities and major commitments paid to individuals related to banks or stakeholders using their own information system and information received from banks and non-bank credit institutions. According to this clause of the budget law, the Central Bank is required to update this information every season.
Ali Sajjadi-Nejad, a banking expert, believes that the new decision of the Money and Credit Council is leading the country’s banking system towards inefficiency. He stated that when we examine the ratio between banks’ base capital and their lending, we see that for some banks and credit institutions, their base capital is negative and they are not legally allowed to provide loans. However, a large quasi-governmental bank in the stock market has given out loans worth 115 trillion tomans this year. According to this banking expert, even banks with reasonable base capital have not followed the regulations for large loans. A private bank active in the tourism industry has given out loans forty-two times higher than the allowed limit for individuals related to the bank, according to the regulations for large loans. (5)
On the other hand, the decision of the Money and Credit Council once again showed that corruption is not only a structural issue in the Islamic Republic, but also that promises to fight corruption and rent-seeking are nothing but lies. Ehsan Khandouzi, the Minister of Economy of the Rouhani government, who was a serious critic of the structural issues as a member of the Islamic Consultative Assembly before his appointment, which contributes to the distribution of rent and corruption, had promised transparency in the information of recipients of large loans last year.
He had written on Twitter using the hashtag “transparency” that in an official letter to the Central Bank, he requested that banks publish a list of their top debtors on their website every three months so that instead of a few individuals, access to facilities would be provided for a wider range of producers and people. Now it has been proven once again that “transparency”, which was a key slogan of the presidential team last year, has ultimately remained only as a hashtag and slogan, while the corrupt structure of the Islamic Republic mafia continues to lead its destructive path.
Notes:
1- The list of bank debtors has been updated, Khabar Online, 13 Mehr 1401.
2- Barakat Pharmaceutical Group’s reaction to the list of debtors of one of the banks, Fars News Agency, 28 Ordibehesht 1401.
3- Revealing the names of debtors over 100 billion tomans and the possibility of a major rotation of bank debtors in amounts ranging from ten to ninety billion tomans?, Shoaresh Sal website, August 17, 2022.
4- The story of those eleven people! What was the fate of the bank robbers who were mentioned in the discussions? Bushehr News, 25 Khordad 1400.
5- Controversial decision of the Money and Credit Council about bank debtors, Donya-e-Eghtesad newspaper, 26 Mordad 1401 (August 17, 2022).
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