- International Enforcement Actions
Mentioned Suspect Entities & Suppliers:
On June 20, 2018, a federal indictment was unsealed in the Northern District of Illinois against Saaed Valadbaigi, an Iranian businessman accused of sending U.S.-origin export controlled materials to Iran. According to the 2016 indictment, Valadbaigi (also known as Saeed Valad and Saeed Baigi), attempted to export a high-strength aluminum alloy that can be used to make centrifuge components and successfully exported materials with missile and aerospace applications. He is charged with three counts of wire fraud, two counts of attempting to violate the International Emergency Economic Powers Act (IEEPA), one count of conspiracy to defraud the United States, one count of illegally exporting articles from the United States, and one count of making false statements on a U.S. export form.
Valadbaigi used a network of front companies he controls in the Republic of Georgia, Malaysia, and the United Arab Emirates (UAE) to facilitate these illicit exports. He also conspired with Belgian businessman Nicholas Kaiga, who pleaded guilty in December 2014 to one count of attempting to violate export control regulations and was sentenced to 27 months in federal prison.
This case illustrates Iran's use of procurement agents, front companies, and elaborate transshipment schemes to secure export controlled U.S. material and technology. The exports and attempted exports took place between 2007 and 2012. A warrant issued for Valadbaigi's arrest in 2016 and remains outstanding. The 56-year-old businessman is considered a fugitive by the United States.
In September 2007 Valadbaigi placed an order with a U.S.-based company for 1,800 feet of 7075 T6 aluminum tubing (ECCN 1C202.a), controlled by the United States for nuclear nonproliferation purposes. Based on the form and strength of the aluminum, it may be controlled by Part 2 of the Nuclear Suppliers Group. This material is valuable for Iran's uranium enrichment program, as it is used to make rotors for the IR-1 centrifuge.
Valadbaigi initially requested that the aluminum be shipped to Super Alloys LLC, his Dubai-based company that provides logistics, packing, and machining services. In response to the export license application, a U.S. Department of Commerce Export Control Officer (ECO) contacted Super Alloys and was informed that the company’s General Manager was in Iran. When the ECO visited the Dubai address listed in the application, he found the office of an Iranian company named Sina Mountain General Trading rather than Super Alloys. As a result of these red flags, the Department of Commerce denied the export license for the shipment to the UAE in February 2008.
In the interim, Valadbaigi placed orders for 300 feet of 4130 steel tubing and 17,543 pounds of 9310 steel bars for delivery to Super Alloys. 4130 and 9310 steel are classified by the Commerce Department as EAR99 and generally unregulated for export except to countries under embargo, including Iran. In November 2009, when he learned that the export license to send the aluminum to the UAE was denied, Valadbaigi directed the American company to send his aluminum and steel orders to Belgium-based company Industrial Metals and Commodities (IMC), managed by Nicholas Kaiga.
At this point, an undercover agent posing as an employee of the American company began communicating with Valadbaigi. In June 2010 the 4130 steel was shipped to IMC in Belgium, where it was transshipped in July to NBH Industries, a Valadbaigi-controlled company in Malaysia. In January 2011 the 9310 steel was shipped to IMC in Belgium, where it was transshipped in March to NBH Industries in Malaysia. The 7075 T6 aluminum tubing was replaced by law enforcement with 6061 aluminum, which is not controlled for export to Malaysia, and shipped to IMC in Belgium in November 2011. The aluminum was transshipped to Malaysia in February 2012.
By October 2012, Valadbaigi and Kaiga discovered that the wrong type of aluminum had been shipped and contacted the undercover agent to complain. The following month, Valadbaigi e-mailed photos of the material from an IP address registered in an Internet Service Provider in Iran, in order to prove that it was the wrong material.
This conspiracy was revealed October 2013, when Kaiga was indicted. He had travelled to the United States several months earlier, met with the undercover agent, and was arrested. Kaiga pleaded guilty in December 2014 to one count of attempting to violate export control regulations, was sentenced to 27 months in federal prison and two year supervised release, and deported to Belgium in July 2015.
Valadbaigi is alleged to have placed two additional orders from U.S. companies, unrelated to the scheme with Kaiga. In March 2009 Valadbaigi allegedly placed an order for titanium sheets from a company in Illinois for export to Georgia Petrochemical and Aviatech, a front company in Tblisi Georgia that he controlled. In May 2009 the titanium sheets were transshipped from Georgia to the UAE. Unable to send the sheets from the UAE directly to Iran, Valadbaigi exported the materials first to Malaysia, from where they were purportedly transshipping in June 2009 to Iran.
In June 2012 Valadbaigi allegedly placed an order for acrylic sheets from a company in Connecticut. In August 2012 he directed the order to be shipped to Belgium, then in November 2012 changed the destination to a company in China, and in December 2012 changed the destination to a company in Hong Kong, from where he attempted to transship the acrylic sheets to Iran.
 “Newly Unsealed Federal Indictment Charges Iranian Businessman with Illegally Exporting Nuclear Nonproliferation-Controlled Materials from Illinois,” Press Release, United States Attorney’s Office for the Northern District of Illinois, June 21, 2018.
 Indictment, United States of America v. Saeed Valadbaigi, a/k/a “Saeed Valad,” a/k/a “Saeed Baigi,” Case No. 16-cr-00482, U.S. District Court, Northern District of Illinois, July 27, 2016.
 Criminal Complaint, United States of America v. Nicholas Kaiga, Case No. 13-cr-00531, U.S. District Court, Northern District of Illinois, June 26, 2013.
 Plea Agreement, United States of America v. Nicholas Kaiga, Case No. 13-cr-00531, U.S. District Court, Northern District of Illinois, December 4, 2014.
 Order, United States of America v. Nicholas Kaiga, Case No. 13-cr-00531, U.S. District Court, Northern District of Illinois, December 4, 2014
 Judgment, United States of America v. Nicholas Kaiga, Case No. 13-cr-00531, U.S. District Court, Northern District of Illinois, March 3, 2015.