Decoding Iran’s Politics: Economic Death Penalties in the Post-Sanction Era

November 20, 2018
H Rastgoo
6 min read
Decoding Iran’s Politics: Economic Death Penalties in the Post-Sanction Era

On November 14, Vahid Mazloumin, alias the [gold] coin sultan, and his associate Mohammad Esmail Ghasemi were executed in Tehran. The pair were accused of setting up a network to disrupt the country’s economic system through illegal dealing of gold coins. According to the judiciary, 16 other individuals have been charged with similar allegations in connection with their activities in the gold coin market.

The police said that Mazloumin’s employees had tried to buy as many as gold coins they could find in an attempt to actually determine the price of coins in the market.

In July 2017, the price of the gold coin was about 1,200,000 tomans [approximately $3.69 at that time]. The price then increased in parallel with the rise in the dollar's exchange rate. In July 2018, when Vahid Mazloumin was arrested, the price of gold had exceeded 3,000,000 tomans. On the eve of the new round of US sanctions, the US dollar rose to more than 19,000 tomans and the coin price exceeded 5,000,000 tomans. Since the re-imposition of US sanctions on November 4, however, the government's intervention in the market has resulted in a relative decrease in the rate of the dollar and the price of gold coins, though many economists believe this situation won’t last for long, and that the dollar rate and the cost of coins will once again rise in Iran.


Special Tribunals

Vahid Mazloumin was arrested about three months before his execution. He was tried in one of the newly-established “anti-corruption special tribunals”. These tribunals were formed a few months after the announcement on May 8, 2018 that the US was withdrawing from the nuclear deal, the Joint Comprehensive Plan of Action. The announcement led to a sharp rise in prices, including that of gold coins and US dollars, on the Iranian market. The Iranian government regarded the situation as a result of organized action by those individuals or networks who, through their activities in foreign exchange and gold markets, sought to profit from the critical situation of the economy or to damage the Islamic Republic of Iran.

As the economic crisis escalated, Sadegh Larijani, the head of the judiciary, wrote to the Supreme Leader and suggested the establishment of new and special tribunals to deal with the "enemy’s economic warfare" and to deal with economic corruption cases. Larijani specifically suggested that special branches of the Revolutionary Court, led by "three judges with at least 20 years of judicial record", could handle such cases. He also called for the ban on "any suspension and mitigation" regarding the verdicts of these special tribunals. Larijani proposed that the convicts would have five days, at maximum, to appeal a special tribunal’s verdict, and that they could only appeal to the same tribunal that had issued the verdict. When it came to execution sentences, according to Larijani’s suggestion, the convicts would have only 10 days to appeal a verdict to the Supreme Court.

Ayatollah Khamenei accepted Larijani’s proposal, and thus the anti-corruption special tribunals were formed on August 11 on the orders of the Supreme Leader.

It is important to remember that, based on Iranian laws, the extreme cases of "disrupting the country’s economic system" are considered to be cases that "undermine national security" and can be subject to heavy punishments, including the death penalty. As a result, the judiciary, even before the establishment of anti-corruption special tribunals, is able to issue death sentences for convicts found guilty of certain economic crimes. Nevertheless, the new special tribunals can significantly facilitate and accelerate the speed with which a capital punishment sentence can be carried out.


The Special Tribunals’ Record

To date, five individuals have been sentenced to death in special anti-corruption tribunals. Apart from the cases of Vahid Mazloumin and Mohammad Esmail Ghasemi, Iran’s supreme court has yet to finalize the sentences of three other convicts.

According to the judiciary, until October 14, in Tehran alone, the special tribunals had issued arrest warrants for more than 200 individuals, as well as indictments for 49 individuals.

The special anti-corruption tribunals were first active in Tehran. However, in less than three months, tribunals were also set up to operate in Shiraz (two out of five recent death sentences have been issued in Shiraz, awaiting approval by the supreme court).

It has also been announced that special anti-corruption tribunals will soon be established in Isfahan and Bandar Abbas.


How Effective are Special Tribunals?

Since their establishment, the special anti-corruption tribunals have been widely criticized. Many experts and journalists, inside and outside Iran, have questioned the tribunals from both a legal and a human rights perspective. Many other critics, especially within the country, have questioned the effectiveness of such tribunals.

The latter suggest that the post-sanctions rise in dollar and coin prices is mainly rooted in economic realities of the market, which may not be affected or changed by the orders of the judiciary.  For instance, when Iran’s oil income falls and its ability to supply dollars becomes limited, the dollar exchange rate will inevitably rise, as the supply of the dollar is less than the demand for it. An increase in the dollar rate will increase the inflation rate, which will also encourage people and investors to buy gold coins in an effort to preserve the value of their money.

Many critics also view the mass economic trials as being a part of the propaganda campaign run by the Leader-affiliated institutions since the post-sanctions era, and that it has no real effect on Iran’s economy. These critics maintain, for instance, that none of the high-ranking state officials who have allegedly been involved in corruption cases have yet been tried in these special tribunals. Some economic experts say that the mass supply of gold coins to the market was the government’s official policy to bring down the public demand for the dollar and to encourage people to buy gold coins rather than foreign currencies. They emphasize that no Iranian law specifies that buying a massive amount of gold coins is illegal. These critics conclude that people like Vahid Mazloumin have committed no crime, and if the mass supply of gold coins has negatively affected the economy, the government officials who decided on such a policy must be the ones to be held accountable.

Nevertheless, many Iranian state institutions, including the judiciary, insist that that the most effective way to control the market is to punish those individuals who seek to disrupt the economy through their organized activities. The heads of the judiciary and other institutions also try to convince the public that, through setting up special tribunals and similar measures, they are doing their best to fight corruption and to resolve the country’s economic problems.

In a broader scene, the special anti-corruption tribunals are viewed as an inseparable part of the Iranian regime’s political measures to keep economic and social conditions under control following the re-imposition of US sanctions on the Islamic Republic.



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