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Source: Foreign Policy

Mar 3, 2023

Corruption Is the Iranian Regime’s Achilles’ Heel

Washington should do a better job exploiting it.

By Danielle Pletka, a distinguished senior fellow at the American Enterprise Institute.

Protests in Iran spurred by the death of 22-year-old Mahsa Amini at the hands of the country’s so-called morality police have continued, with escalations by the regime—including the executions of a well-known wrestler and a dual national—failing to dampen public anger.

Looking for a silver bullet to silence its restive public, Tehran has failed to find one. But the Iranian people have failed equally, being yet unable to find their own silver bullet to topple the ayatollahs for once and for all.

But it may be that bullet exists: corruption. And it’s lacking only a responsible Western power to pull the trigger.

Before digging into the ordure of Iranian official thievery, take a moment to recall the tales of other deposed regimes.

In too many cases, leaders and cronies of various tyrannies were fully fledged members of the community of nations—with a seat at the United Nations, reception at the White House, and/or a nose at the U.S. taxpayer’s trough, among other seals of approval—only to be ousted and for the world to discover with shock—shock!—that the despot had been skimming billions of dollars from their country’s coffers.

Remember Washington’s dear pal, former Egyptian President Hosni Mubarak—a Camp David attendee who conducted annual visits to Washington and received tens of billions of dollars in U.S. military and economic assistance?

He was ousted in 2011, but his corruption was legend inside Egypt—unofficially, of course—with only the smarmiest of admirers ignoring its manifest evidence. It should have been obvious in Washington as well.

Mubarak owned property in Beverly Hills, a share of resorts in the Egyptian seaside city of Sharm el-Sheikh, and houses in London and New York. Experts estimated his fortune at a cool $70 billion, with his two kids also allegedly billionaires.

Or how about former Iraqi leader Saddam Hussein, who had been Washington’s darling before that embarrassing 1990 invasion of Kuwait. Throughout the 1990s, he used a United Nations-administered oil-for-food program to skim millions of dollars for his and his sons’ personal profit, with some of his dealings also reportedly enriching then-Russian President Boris Yeltsin and a young Vladimir Putin.

The U.S. government was also well aware of Saddam’s evasions of oil sale restrictions, including to U.S. allies in Jordan, Turkey, and the Persian Gulf. (By the way, guess who was also profiting from Saddam’s dirty business? Iran’s Islamic Revolutionary Guard Corps, or IRGC. Also, one-time U.S. ally in the war on terrorism Syrian President Bashar al-Assad.)

And then there was former Libyan leader Muammar al-Qaddafi, the same Qaddafi who sponsored the downing of U.S. carrier Pan Am Flight 103 over Lockerbie, Scotland, in 1988, killing all 259 people aboard as well as 11 people on the ground.

True, he was no one’s darling, even after a brief post-9/11 rapprochement with the West. But after then-U.S. President Barack Obama finally turned on the aging Qaddafi in 2010, implicitly supporting the Libyan mobs that ultimately captured and killed him, the press professed itself shocked: “As Libya takes stock, Moammar Kadafi’s hidden riches astound,” the Los Angeles Times marveled.

The mercurial Qaddafi was discovered to have more than $200 billion stashed around the world. The kicker? Around $37 billion were reportedly in U.S. banks.

And like his neighbor Mubarak, the Libyan dictator shared with his kids, as did everyone seeking to curry favor with the leader. A friend of his son Saif earned $58 million in “advisory fees” from French financial services firm Société Générale, per Transparency International.

The international anti-corruption watchdog also noted a Canadian company with Qaddafi’s daughter-in-law on its payroll. In 2019, the Independent reported on a “deadly web of global corruption” that risked entangling Canadian Prime Minister Justin Trudeau. The stories go on and on and on. And apparently, someone is still stealing the money Qaddafi stole first.

As this litany makes clear, any exposé of kleptomania in the Middle East could stretch for terabytes. Lebanon alone suffers from titanic levels of elite and government corruption that have destroyed what little Iran and Syria have left for the Lebanese people. Also clear is that most (though not all) such corruption is revealed after the fact; serious U.S. government action against corruption in, for example, Russia only came after Putin’s second invasion of Ukraine in 2022.

Which brings us to Iran.

There was a time when both Sunni and Shiite Islamists prided themselves on their resistance to the corruption endemic in the Middle East, but those days are long gone.

Infamous former Iranian President Ali Akbar Hashemi Rafsanjani was said to have millions of dollars to his name. Anti-regime organization United Against Nuclear Iran runs through a timeline of official thievery, detailing billions of dollars stolen inside the Iranian oil ministry, billions more embezzled from state banks, tiny percentiles of government appropriations for health actually spent on medicine and supplies.

After current Iranian President Ebrahim Raisi was appointed to run the nation’s judiciary in 2019, his predecessor was nailed for depositing bail money into 63 different bank accounts to the tune of almost $100 million.

Some of this corruption has been detailed in domestic newspapers and reports inside Iran. But the closer to the top the miscreant gets, the less likely there is to be any news. Infamously corrupt former senior IRGC officer and Tehran mayor Mohammad Bagher Ghalibaf allegedly bribed state officials to avoid fraud charges. Former IRGC-Quds Force Commander Qassem Soleimani was also implicated, with all revealed in a leaked recording.

The story received extremely limited coverage inside Iran because of Ghalibaf’s ties to Supreme Leader Ali Khamenei and Soleimani’s so-called martyrdom. Indeed, Khamenei slammed newspapers for reporting the story at all, labeling the leaks as enemy efforts to “[slander] the central elements that played a role in the advancement of the revolution; one day it’s the Majles [Iran’s parliament], one day it’s the Guardian Council, and one day it’s the IRGC. Today, it’s the IRGC’s turn. Today, they slander the IRGC and try to tarnish it and the great martyr Soleimani.”

Khamenei similarly swept sexual assault charges away in the case of a favored Quranic orator, censured newspapers and ministers that reported on corruption within the government, and denounced charges of corruption against former Chief Justice Ayatollah Sadeq Amoli Larijani, who was accused of tolerating widespread theft. (His former deputy was actually arrested for financial crimes in 2019.)

Larijani was ultimately replaced by Raisi, who is now considered a likely candidate to replace the ailing supreme leader after his death. And when Rafsanjani began detailing Khamenei’s sons’ vast wealth in 2016, his own son was quickly arrested and sentenced to 10 years in prison.

Opposition cleric Mehdi Karroubi, who has been under house arrest since 2011, wrote an open letter to the supreme leader in 2018, accusing him of tolerating systemic corruption and impoverishing tens of millions of Iranians while enriching a small elite.

“Under such conditions,” he warned, “it is natural that the lower classes, who were the grassroot supporters of the Islamic Revolution, will turn into a gunpowder barrel.”

Given widespread awareness of corruption inside Iran, curious people may wonder why additional sordid details could tip the balance of what is already a widespread revolution inside Iran. But there is a huge hole in reporting on graft at the most senior levels of Iran’s government, with allegations about Khamenei’s own crimes appearing only on exile and hostile foreign websites.

In short, Khamenei does not want his citizens (or lesser government officials) to know about the breadth of his own sins. And small wonder: Iran’s own Ministry of Cooperatives, Labour, and Social Welfare reported in January that around 60 percent of the country’s 84 million people live below the poverty line, with one-third living in “extreme poverty”—double the number of the previous year.

Far from blaming the United States or international sanctions for their strife, Iranians have made clear they blame their own government. Were they to know in real time—rather than after the fact, Qaddafi- and Mubarak-style—just how much money their supreme leader and his cronies had stolen, it could, as Karroubi warned, tip the balance and finally turn the regime’s remaining supporters in the security forces and the public against them.

How could this happen? Trump administration officials accused Khamenei of being worth around $200 billion. (A previous Reuters investigation detailed assets worth at least $95 billion.) But that’s the extent of U.S. government jabs at the supreme leader.

Much as the Trump administration began detailing Khamenei’s personal wealth, the U.S. and European governments could begin unraveling the web of concealed assets owned by the supreme leader and his family—and act on the information.

Subsequent to Iraq’s invasion of Kuwait, the U.S. government froze Saddam’s assets. Ditto the assets of Qaddafi and his cronies once the United States decided he had to go. True, some of these assets were sovereign—nominally the foreign government’s money. But not all. So why wait?

If corrupt enemies of the United States can have their assets frozen in the event of their ouster or war, then why not do it preemptively? As the Biden administration has made crystal clear in the case of Russian oligarchs and Putin’s cronies, it has the legal authority to freeze the proceeds of corruption.

Most of the Middle East’s late dictators had money and real estate in the United States under the jurisdiction of the U.S. federal government. The United States has multiple avenues to communicate details to the Iranian people, whether through whatever U.S. press leaks in, Persian-language Radio Farda (part of U.S.-funded Radio Free Europe/Radio Liberty), or the U.S. president’s own bully pulpit.

If, as senior U.S. officials have suggested to me, corruption is truly the Iranian regime’s Achilles’ heel, isn’t it time someone started exploiting that weakness to the benefit of the long-suffering Iranian people?

Danielle Pletka is a distinguished senior fellow at the American Enterprise Institute and co-host of the podcast What the Hell is Going On? Twitter: @dpletka

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