- International Enforcement Actions
- United Arab Emirates
Iran’s most notorious attempts to smuggle goods from the United States involve complex procurement networks seeking items for nuclear, missile, and military programs. Often, however, Iran employs these networks to serve key industries. On June 26, a U.S. district court in Ohio sentenced the Canadian exporter Angelica O. Preti to 18 months in prison for facilitating shipments of gas turbines to Iran in violation of U.S. sanctions. Preti’s sentencing follows the related case of Ohio resident Behrooz Behroozian, whom a judge sentenced to 20 months in prison last October.
Behroozian, like Preti, exported industrial equipment illegally and for the benefit of Iran's gas and petrochemical industries. Still, Iran’s security forces play a central role in many aspects of the country’s economy, including the petrochemical and petroleum industries. And while most of these exports had no military applications, prosecutors described items sent by Behroozian as "controlled components that have both commercial and military uses."
Behroozian is a naturalized U.S. citizen born in Iran. He acquired an associate’s degree in engineering before launching the Dublin, Ohio-based company Comtech International LLC in 2006. Behroozian billed Comtech as a computer parts supplier, but the firm lacked a storefront, made no domestic sales, and rarely exported computer parts. Comtech served as little more than a front organization for Behroozian's illegal exports to Iran.
Behroozian worked with the Dubai-based intermediary company Sumar Industrial Equipment Co. LLC, a self-described "major supplier of heavy equipment" that helped him transship goods to Iran. Together, Behroozian and Sumar delivered their industrial exports to the Iranian firm Arman Pisaro Sanao, which had first placed the orders.
Canadian news agencies report that Preti, an export operations manager at the company UE Canada Inc., has a connection to the Behroozian case. UE Canada is a freight forwarding and customs brokerage service provider that does "significant business" in Ohio. On its website, the company touts its ability to solve "intricate logistical problems." The company's website also mentions UE Canada’s U.S. subsidiary, United Expeditors (USA) Inc. To date, however, prosecutors have not made public a direct connection between Behroozian and these companies.
Behroozian and his associates followed a well-known playbook used by Iranian smugglers: shipping American-made goods through intermediaries in third countries to obscure the final destination in Iran. Between 2004 and 2016, Behroozian obtained connectors, manifolds, and valves from U.S. manufacturers. He then exported the items to Sumar in Dubai, which acted as a "transactional middle man" by sending the shipment on to Arman in Iran. After establishing Comtech in 2006, Behroozian used his company to arrange purchases and shipments.
Arman paid Behroozian almost $250 thousand through hawala, an informal value transfer system popular in the Middle East and harder to track than wire transfers. Though thousands of workers from Afghanistan to Somalia use hawala as a means of sending money to their families, militants and other criminals have often employed hawala to avoid the scrutiny that accompanies conducting transactions through the global financial system. Arman also paid Behroozian between $35 and $40 thousand a year by routing the money through Sumar.
Behroozian hid these transactions by misrepresenting Sumar to the U.S. Commerce Department as the end user of Comtech’s acquisitions. In fact, the Emirati firm was just forwarding these products to Arman. Behroozian also falsified documents submitted to the Commerce Department about the destination and value of these shipments. Behroozian’s scheme continued even after the Commerce Department designated Sumar as an unreliable recipient of American goods, in light of evidence that the company functioned as an illegal backchannel for supply to Iran.
The U.S. Justice Department has yet to clarify Preti’s relationship, if any, with Behroozian and his network, but her case bears several parallels to his. She too falsified documents and took other steps to obscure the fact that Iran was the final destination of the exports. During her tenure at UE Canada, 23 of the 47 shipments exported from the United States were ultimately destined for Iran. The Justice Department has not said whether any of those exports involved Arman or Sumar, or overlapped with Behroozian’s shipments.
Behroozian and Preti are serving their sentences in U.S. custody. Nonetheless, some circumstances surrounding their cases remain unknown because relevant documents are still under seal. Portions of Behroozian's sentencing memoradum have been redacted, and none of the documents related to Preti's case have been released publicly. The Justice Department has described the cases as "sensitive," suggesting that its investigation is ongoing.
"About us," UE Canada Inc., available at http://www.uecanada.com/about_us.html.
"Canadian Exporter Sentenced in U.S. for Breaching Iran Embargo by Secretly Exporting Oil and Gas Equipment," The National Post, June 30, 2020, available at https://nationalpost.com/news/canadian-exporter-sentenced-in-u-s-for-breaching-iran-embargo-by-secretly-exporting-oil-and-gas-equipment.
"Canadian Woman Sentenced to Prison for Illegally Exporting American Industrial Pipeline and Oil Refinement Equipment from United States to Iran," U.S. Department of Justice, June 26, 2020, available at https://www.iranwatch.org/library/governments/united-states/executive-branch/department-justice/canadian-woman-sentenced-prison-illegally-exporting-american-industrial-pipeline.
"Columbus Man Sentenced to Prison for Illegally Exporting Goods to Iran," U.S. Department of Justice, October 24, 2019, available at https://www.iranwatch.org/library/governments/united-states/executive-branch/department-treasury/columbus-man-sentenced-prison-illegally-exporting-goods-iran.
Government's Sentencing Memorandum, United States of America v. Behrooz Behroozian, U.S. District Court for the Southern District of Ohio, October 18, 2019, available at https://www.iranwatch.org/library/governments/united-states/executive-branch/department-justice/governments-sentencing-memorandum-united-states-america-v-behrooz-behroozian.
"Sumar Industrial Equipment Co. LLC," EC21.com, available at https://sumardubai.en.ec21.com/company_info.html.
Transcript of Sentencing Proceedings, United States of America v. Behrooz Behroozian, U.S. District Court for the Southern District of Ohio, October 24, 2019, available at https://www.iranwatch.org/library/governments/united-states/judicial-branch/transcript-sentencing-proceedings-united-states-america-v-behrooz-behroozian.