December 11, 2019

U.S. Sanctions Iranian Shipping Network, Mahan Air Sales Agents

By Samuel Rubenfeld

(Photo: Alan Wilson)

The U.S. Treasury Department on Wednesday imposed sanctions on an Iranian shipping network involved in smuggling lethal aid to Yemen on behalf of the Islamic Revolutionary Guards Corps-Qods Force (IRGC-QF), and on three general sales agents of Mahan Air.

The Treasury’s move, its third sanctions designation action this week, followed a recent announcement that the U.S. seized weapons and missile parts of Iranian origin smuggled on a small boat reportedly destined for Yemen. 

On Wednesday, the Treasury sanctioned the network that attempted the delivery. The IRGC-QF has over the past decade used Iranian businessman Abdolhossein Khedri, and companies under his control, to support their maritime weapons smuggling operations, according to the Treasury. 

“The Iranian regime uses its aviation and shipping industries to supply its regional terrorist and militant groups with weapons, directly contributing to the devastating humanitarian crises in Syria and Yemen,” said Secretary Steven T. Mnuchin. 

Since 2018, Khedri used Khedri Jahan Darya Co. and Maritime Silk Road LLC, as well as vessels controlled by Khedri Jahan, to support the IRGC-QF smuggling operations, the Treasury said. Both companies operate in the shipping sector, according to the Treasury. 

The merchant vessel Genava 12, which is owned and managed by Khedri Jahan, was suspected of involvement in the transport of IRGC-QF cargo from Iran destined for Yemen, the Treasury said. Khedri Jahan also owns and operates the Genava 11, the Treasury said. Maritime Silk Road used the Genava 12 between 2015 and 2017 to ship cargo for an IRGC-QF affiliated company, according to the Treasury.

Separately, the Treasury designated three Mahan Air general sales agents (GSAs). Mahan Air was sanctioned in October 2011, and the Treasury named it in a July advisory as one of the dozen designated airlines as posing particular sanctions risks. The U.S. State Department on Wednesday added its own designation of Mahan Air for its role in weapons proliferation, Secretary of State Mike Pompeo said at a brief press conference. Mahan Air has routinely flown fighters and materiel to Syria since the onset of that country’s civil war, the Treasury said.

The Treasury has previously sanctioned Mahan Air GSAs, which are third parties that provide services to an airline under the airline’s brand. The airline’s website names at least a dozen of them in Europe and Asia, Kharon reported in August 2018. Gatewick LLC, the freight and cargo GSA in Dubai for Mahan Air, was among the GSAs sanctioned Wednesday. 

Gatewick LLC facilitated the airline’s participation in a scheme involving Mahan Air to export computer motherboards from the U.S. to Iran in 2009, Kharon reported. The company reached a settlement in 2014 with the U.S. Commerce Department over the matter, agreeing to a penalty.

The Treasury also sanctioned Jahan Destination and Tourism LLC, the ticketing GSA in Dubai for Mahan Air; and Gomei Air Services Co., Ltd., the Mahan Air GSA in Hong Kong and in the southern mainland Chinese cities of Shenzhen and Guangzhou.

And the Treasury provided guidance to the aviation sector, saying the industry should conduct due diligence on GSA services beyond ticketing and freight booking for other activity that could be subject to sanctions. Such activities could include procurement of aircraft parts and equipment, ground services, and maintenance and refueling contracts, the Treasury said, citing similar language from its advisory issued in July.

 “Aviation and shipping industries should be vigilant and not allow their industries to be exploited by terrorists,” Mnuchin said.